Owning a 4-plex Can Be a Pain

Owning a 4-plex Can Be a PainOwning a rental property is one of the most popular ways to generate passive income, but it’s not always easy. We purchased a 4-plex through a short sale process in October 2011 and my rental income projection was quite wrong. I finally finished our 2012 tax return and I can share the details from the 4-plex now. I’ll put it next to my original projection so you can see how…

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How we paid off our mortgage in 6 years

How we paid off our mortgage in 6 yearsIf you have ever heard the phrase “A day late and a dollar short,” it applies to me. After spending six years looking forward to the day when I could burn my mortgage, my final lump sum payment was $1 short of paying off the $1,979 balance. So instead of being mortgage-free on Oct 31 which had been our goal, the final $1 came out on November 1, which was…

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Retire Early Plan Has High Risk of Failure

Retire Early Plan Has High Risk of FailureMing and Li are exceptional savers. They have already paid for their $300,000 home in southwestern Ontario and saved nearly $330,000, without any help from parents since they graduated. They have built a solid financial base for themselves and their two young children. Now the 37-year-old software developer and 34-year-old consumer research analyst wonder whether socking away a further $50,000 a year from their $163,000 income would put them in…

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Buying Your First Home is Now More Difficult

Buying Your First Home is Now More DifficultBuying a first home or taking out a loan against an existing residence will be more difficult for Canadians under new rules announced Thursday, but Finance Minister Jim Flaherty says it’s for their own good. For the fourth time in as many years, the finance minister moved to tighten the mortgage and lending landscape — changes that mean up to five per cent of Canadians who might be considering buying…

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Home Sales Rise

Home Sales RiseCanadian home sales climbed in February after a soft January and price gains picked up speed, confirming the country’s housing market remains buoyant and a potential concern for bubble-wary policymakers. February existing home sales in Canada grew by 1.4% from a month earlier, Canadian Real Estate Association data showed on Thursday. Sales had fallen 4.5% in January from December. The industry group said sales were up 8.6% from a year…

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Best Times to Make an Extra Mortgage Payment

Best Times to Make an Extra Mortgage PaymentPeople need to realize that the behaviour in the real estate market in Canada in the past 10-12 years is not normal, nor sustainable. Housing, historically, has risen fairly close to the increases in real incomes (income adjusted for inflation) during 1950-2000. In the past decade real incomes have moved very little (if at all) while home prices have appreciated to staggering levels increasing the amount of debt individuals and…

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Why are Mortgage Rates Hitting Record Lows?

Why are Mortgage Rates Hitting Record Lows?All across the country, mortgage specialists and brokers are busy fielding calls from people who’ve just heard about this week’s record low mortgage rates. Bank of Montreal made the biggest splash by announcing a five-year fixed-rate mortgage of 2.99 per cent – the lowest advertised rate for such a popular mortgage term by any major Canadian bank, ever. Yes, there are more restrictions than usual attached to this mortgage and…

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Family Debt-to-Income Ratio Hits Record

Family Debt-to-Income Ratio Hits RecordThe average family debt-to-income ratio in Canada has now hit a record 150 per cent, the Vanier Institute of the Family said Thursday. That means for every $1,000 in after-tax income, Canadian families owe $1,500, the institute said, while releasing its 12th annual assessment of Canadian family finances. It found the average family borrowing — including mortgage debt — now totals $100,000. The Ottawa-based institute, which describes itself as a…

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Canada New Mortgage Rules

Canada New Mortgage RulesIn mid-January, Finance Minister Jim Flaherty announced new mortgage rules that would be put in place to help stop rising debt levels among Canadians, and to keep another mortgage meltdown from occurring. These rules, three of them in total, are another measure the government has put in place to tighten the rules for people getting mortgages. In 2010, stronger rules were put in place, and this adds to that. The…

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How To Make Your Mortgage Interest Tax Deductible

How To Make Your Mortgage Interest Tax DeductibleFor US homeowners, mortgage interest is automatically tax deductible. But for Canadians, the write-off is not so straightforward. In order to make your mortgage interest tax deductible, homeowners must be able to prove that the money is being reinvested and is not being used for personal expenses. A properly structured mortgage-centric tax strategy has several key elements – the most important of which is a multi-component, readvanceable mortgage or line…

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