Why Canadians Are Breaking Their Mortgages (And Saving Thousands)

[@DVinCanada]

A reasonable financial advise should be don’t over spend money you don’t have. Mortgages are enough debts to handle. Keep getting refinance, or line of credit, or credit card debts is a downward spiral to hell.

[@Enjoyablewalks]

Amen to that piece of golden advice

[@ZulfiqarAli-rf6fp]

This is ur one of the best videos which is not time wastage with good information. Thx

[@markmussington4131]

Great show and Jessie seems to be a great resource

[@infosofi]

Great episode Tom, one of the best shows/guests you had, thanks for all the valuable info Jesse!

[@sandhugo]

Good information. I like when a learned man talks with clarity . Here we have 2 of them ! Thanks

[@rustyscrapper]

This is not how it was explained to me at the bank. I was told the penalty to break the mortgage is equal to the spread un your rate and the current rate, and you save nothing to break it early. They bake it into the new mortgage and you get a lower rate with a big penalty added on and basically the same payment. HOWEVER!!! If you SELL your house the penalty is only 3 months interest. So to get out of the high mortgage without a penalty you have to sell the house and end the mortgage. Buy another house with a new mortgage and lower rate. Then you get a lower payment. This incentive to trade up your house will set the market on fire, the incentive will be better house lower price and everyone will be flipping into a different house to get out of their ass mortgages.

[@philippickles693]

I've only let my mortgage go to full term only once. Breaking and blending is one way to go.. Scotia had me on a 50/50 ratio and it was interesting to see how the variable would change when the BOC would increase rates.. overall the variable paid more principle off.. this was in the early to mid 2000s

[@ahmedelalfy3107]

Excellent topic

[@Waterlily477]

Today I subscribed because of this video you made 🙏

[@ThePhandey]

Great info! Keep up the good work!!

[@ZulfiqarAli-rf6fp]

U brought very good point 50/50 split which 90% people don’t know

[@philippefinancespersonnelles]

Amazing interview guys !! 🎉🎉

[@alexhakimi7642]

Fed cut 0.50 today, hopefully Bank of Canada will follow on OCT

[@jay1645]

Has to .. to 0 in 12 months or so

[@rustyscrapper]

Canada already cut 3 times but will likely keep going 25 at a time. The fed seems to want to be dramatic about it and go 50 at once.

[@jay1645]

Can. has to go to 0 or else ..

[@sandhawan]

Great conversation

[@KhaledHussen-t1e]

Excellent explanation.

[@SbnAmd]

Very informative! Thank you for the content!

[@typicalc]

Our bank only does 5 yr variable closed. So now its time to look at other options.

[@PSR1791]

TD will do a 3 year variable if you have enough equity to position a home equity line of credit with the mortgage.

[@ad03dh]

Fix it to sleep then if it does down a lot break and re fix it . Variable is not good bc what goes down will go up.

[@harisdesigns3833]

Lower your music a bit, great video!

[@joed8896]

Thanks Nice insight

[@majucamex08]

There is not golden rule, I was variable for 5 years at 2.11, then went variable again for 2.29 for another 5 years at the renewal I didn’t want to go again for variable as the gap with the fixed was not more than.40 then I went for fixed 5 years more at 2.79 then the interest stated to skyrocket and I was safe…. Don’t know how the interest will be at the renewal but for sure won’t be to high and if they do the damage won’t hurt as the remanente to pay is not a lot. Well this just to illustrate there are risks everywhere which we have to learn to deal with

[@notpastranapastrana2403]

bought mine at 5.09 5 yr fixed this early 2024...first time home buyer..what should I do?

[@as17ns22]

More information on the laddering strategy would be helpful. You had me up until wrapping the $100k into a new mortgage segment. Some elaboration on this part of the process would be helpful. If the 100k is part of a LOC that is unsecured, why would a lender incorporate it into a mortgage segment?

[@TomStorey]

We’ve got Jesse booked on the podcast channel soon. I’ll make sure this is covered more in depth.

[@munishkumar1586]

Can I have contact information for Jesse to discuss my mortgage

[@TomStorey]

His info is in the description. Thanks!

[@10koksc]

If you break your current term would your bank need to re qualify you?

[@dsaryan]

If you're 60% through paying your house, is it better to get a large line of credit to pay the rest of the outstanding amount or continue with a mortgage product?

[@TomStorey]

Answer from Jesse: Depends on your rate, also whether you make continuous lump sum payments, LOCs are open and payable anytime, mortgages are a little more restrictive

[@majucamex08]

No way, your loc will be always more expensive than your mortgage, you cannot beat the bank..

[@allcan4175]

I hear there are some really low interests right now offered, unless i'm wrong - edit - as in lower

[@Waterlily477]

Where?

[@rps1689]

A large segment of our society is now paying the price for an era of too low interest rates not to mention giving an overall lesser tax rate on capital gains than personal income over the years, which has conditioned too many to view their homes primarily as an investment vehicle/financial asset. The days of welfare for mortgagers - mortgagers who benefited greatly financially from insane low interest rates; basically free money, is no longer the norm.

[@chanface]

Its sooo hard to find a good mortgage broker in my experience. They are a dime a dozen and its difficult to weed out the bad ones.

[@Laughingtulfo]

What's the prediction on the rate on end of 2026?

[@ChasingBogeys]

I think it’s going to stabilize around 3.75, maybe 3.5.

[@lucash1980]

​@@ChasingBogeys based on??

[@ChasingBogeys]

@@lucash1980 let me preface by saying that no one has the crystal ball and can predict anything for certain but to answer your question, various things: Being in tech service exclusively financial clients, I have been focused inside and outside of macro&micro economic news. Also economy centric articles and stats clearly show the phase of the economy, how the geopolitical (wars, covid, gas prices etc), inflation, and market conditions drove the rates up and the impact on consumer spending, the reason why it’s being cut now. Canada being a high tax country, and neighbouring U.S., cannot afford to have extremely misaligned rates to the North American and European markets. So they’re going to try to do another couple of cuts to get to mid/high 3s. And then it would depend on how all the factors I mentioned above are doing. Sorry hard to answer such a loaded question on a KZbin comment, but hope I made some sense.

[@MirzaVP]

Why not just make houses affordable so people can just buy them and not have a mortgage to pay ?

[@stephenn88]

Tom did you go fixed or variable

[@TomStorey]

Have one of each.

[@laineym2237]

@@TomStoreywould you recommend fixed or variable for primary residence and which for a rental investment property?

[@stephenn88]

@@laineym2237fix!!!

[@rohanutep81]

@@laineym2237fixed for primary

[@TheNewMediaoftheDawn]

Fixed or variable, the house (bank) always wins,,,😂

[@jay1645]

Carney has appeared lol

[@bestofpkl0853]

My renewal is coming in two months, can I take variable at renewal date and convert it into fixed in next 8-10 months? Can I move from variable to fixed in less than one year?

[@TomStorey]

Yes, you can convert out of a variable closed at any time to a fixed rate without paying a penalty the difference is some lenders will offer different terms versus others. Please confirm specifics with your broker/lender.

[@KarenSolazzo]

Fantastic video, Can I get the mortgage broker contact info please? I can’t seem To find it in the transcript😁

[@TomStorey]

www.vinegroup.ca/jesse-merson

[@argeldelacruz9545]

Do you need to re qualify if you switch lenders for a better deal?

[@TomStorey]

On November 21, 2023, the federal government announced a new Canadian Mortgage Charter. It said that homeowners with insured mortgages (less then 20% down) aren’t stress tested when they renew their mortgage with a different lender. So you’re not stress tested, but you do still have to qualify (without the stress test) The best way to think of the charter is as a list of "rules and expectations" banks are expected to follow. However, with an uninsured mortgage, you would have to requalify and be stress tested when changing lenders. Hope this helps.

[@Waterlily477]

Can we have Jessie’s contact info for our up coming mortgage renewal please and thanks i

[@TomStorey]

www.vinegroup.ca/jesse-merson

[@rustyscrapper]

I will re lock my mortgages if i think interest rates have bottomed and might go back up. Then its worth paying a penalty to lock low. If i think rates are still dropping i will wait and eat the higher payment and run out the clock until renewal 3 months early with no penalty and a super low rate. Unless the CPI starts going back up again. Then lock it.

[@Waterlily477]

I agree on this one. 👍🏻

[@OurPmIsAWacko]

O you're talking about greedy Canadians who want to buy multiple houses so they can be rich

[@adamnarbeaux5898]

Not true.

[@Chris-se3nc]

Wait

[@David-gu1rn]

Just about to close on our first house this October, and my broker told me I could break my 5 year fixed 4.29% rate when the interest rate decreases next year. Their penalty for breaking the fixed rate is 3months interest or IRD whichever is higher (not calculated using IPD). Do you think this is a good deal?

[@Relaxlifeisshort2]

This is why you should never have listened to Steve your sidekick and lock in a t 5 years. Anyway usually i get his thinking but that he was way off

[@TomStorey]

I went 3 year fixed. Happy with that decision for my primary residence.

[@Relaxlifeisshort2]

@@TomStorey correction right 3 years meant to say I was going to do the same but then thought nah. I am in logistics and i will go with my stats better then the feds stats and saw this coming.

[@TomStorey]

@@Relaxlifeisshort2 If I did it again now, I would probably go variable. But not regretting my decision.

[@Relaxlifeisshort2]

@@TomStorey still ok not a bad choice.

[@elvisnketi7271]

I am at 6.7 % at the moment. With two years to complete the term. What are my options

[@niftyoptionslivetradingand7231]

70% of young Canadians don't think they can ever buy a home, a grassroots Analysis is required here, else this entire housing and mortgage market will slowly bleed and ultimately collapse 🩸😔, shattering so many dreams of Real Estate investors..