Increased Amortization with Leverage

Hidden Money!

Increased Amortization with Leverage

 

Another strategy I employ with clients, involves increasing their mortgage amortization (which decreases payments) then taking out an investment loan and investing, with the plan of using it to pay down the mortgage in future.   It effectively lowers your monthly payment, creates a tax deduction annually, and pays off a mortgage quicker.

This looks really good, & has great potential, however it is important that you are aware of any risks associated with this particular strategy. This is the more risky of the 3 strategies (and although I have attached a sample of what this might look like – using a real client) this is really something we would want to go over before you make any decisions.

SAMPLE – for illustration purposes only

Original Principal: $248,000.00
Mortgage Loan Date: January 1, 2008
Original Proposed
Payment Frequency: Monthly Monthly
Mortgage Type: Fixed Rate Fixed Rate
Interest Rate: 5.000% 5.000%
Term (years): 10.00 10.00
Amortization (yrs/periods): 15.00 / 180 35.00 / 420
Payment Amount: $1,955 $1,244
Total Payments in First Year: $23,455 $14,922
Total Interest Cost For Term: $90,248 $115,032
Total Interest Cost For Amortization Period: $103,818 $274,280
Mortgage Balance at 10 years: $103,702 $213,809
Take out 100,000 Investment loan over 10 years with an 8% rate of growth (see
projections) = $110,226 net.
If used to pay down mortgage, outstanding balance after 10 years = 103,583 left owing on
the mortgage.
Your monthly payments are reduced by $344 per month & because your borrowing to
invest on the $100,000 investment loan. You will get a tax refund of $1764 annually.
Net result
$1764 in new tax savings
$119 less left owing on your mortgage
$344 less in monthly payments
• original cost – proposed + cost of Investment loan (367/month)
These projections are based on certain assumptions that are believed to be reasonable, but there is no assurance that the actual results
will be consistent with this projection. The actual results may vary, perhaps to a material degree, from these projections.

TD Mortgage Rate Lowers! 4.35%!!

Great news TD Mortgage Rate Lowers!!

 

TD Mortgage rates are lowering! Today it was announced that effective November 19^th 2008 that a limited time offer of 4.35% 1 Year Closed Fixed Rate Mortgage will be offered on applications up to December 31^st 2008. All transactions must be funded by no later than April 30^th, 2009. As with all Mortgage products the offer can be changed or withdrawn at any time – time is of the essence! Is your mortgage working for you, or are you working for your mortgage? Today is the perfect time to start saving money. Today!

Canadian banks ranked soundest in the world

Canada has the world’s soundest banking system, closely followed by Sweden, Luxembourg and Australia, a survey by the World Economic Forum has found as a financial crisis and bank failures shake world markets.

Britain, which once ranked in the top five, has slipped to 44th place behind El Salvador and Peru, after its government pledged the equivalent of $97 billion Cdn this week to bolster bank balance sheets.

The United States, where some of Wall Street’s biggest financial names have collapsed in recent weeks, rated only 40th, just behind Germany, at 39th, and smaller states such as Barbados, Estonia and even Namibia, in southern Africa.

On Thursday, the U.S. was considering buying a slice of debt-laden banks to inject trust back into lending between financial institutions now too wary of one another to lend.

The World Economic Forum’s Global Competitiveness Report based its findings on opinions of executives and assigned banks a score between 1.0 (insolvent and possibly requiring a government bailout) and 7.0 (healthy, with sound balance sheets).

Canadian banks received a score of 6.8, just ahead of Sweden (6.7), Luxembourg (6.7), Australia (6.7) and Denmark (6.7).

U.K. banks collectively scored 6.0, narrowly behind the United States, Germany and Botswana, all with 6.1. France, in 19th place, scored 6.5 for soundness while Switzerland’s banking system scored the same in 16th place, as did Singapore (13th).

The ranking index was released as central banks in Europe, the U.S., China, Canada, Sweden and Switzerland slashed interest rates in a bid to end panic selling on markets and restore trust in the shaken banking system.

It is certanly reasuring to be a proud part of a sound economic banking system. Canada’s banking system has been underrated for years, TD Canada Trust is infact the 5th largest Bank in America, yes you read that correctly in America! It has very strong US base with TD BankNorth group, and is infact the namesake of the Celtic’s home in Boston MA !!!

TDdave

How to Improve Word-of-Mouth

Is your phone ringing weekly with new clients? Are clients banging on your door demanding your help? If not, it could be because you’re not taking advantage of simple marketing tactics that improve word-of-mouth.

Studies prove time and time again people are more likely to do business with someone when they have been referred. Today’s article describes how to improve word-of-mouth marketing so you reap the benefits of making more money and creating more relationships in less time.

Word-of-Mouth Produces Referrals

Do you deliver great service? Do clients and your partners often comment how much they appreciate you? Yet, you are not getting the amount of referrals you deserve?

If you only depend on delivering great service as a way to produce referrals, you are missing golden opportunities to increase production. In other words, great service alone isn’t enough to stimulate word-of-mouth consistently, especially if you are in a downtrodden market.

Here are 3 examples that improve word-of-mouth marketing:

• Make your service memorable
• Use diversion tactics
• Give items with long shelf life

 

Read further and learn how each point strategically improves your level of service and influences clients so they promote you.

Make Your Service Memorable

Your service can be remarkable, but is it memorable? Creating memories is what makes it easier for clients to talk about your service. This can be achieved by adding “wow” factors.

Consider a home purchase. Traditionally, when a client purchases a new home, a gift basket is delivered when the deal is closed. But what about collaborating with your lender and throwing a welcome party for the client? Guess who attends? …Their new neighbors, friends, family and co-workers.

If the client is refinancing, you can add a “wow” factor by sending a gift when the loan is approved, and then again when the deal is closed. This double gifting has a positive effect, making your service memorable.

Use Diversion Tactics

Diversion means you are purposely channeling your service so it gets noticed. If you send the client a gift basket, ship it to their place of work. The girth of the package gets noticed by others and prompts questions. Questions lead to conversations.

Give Items with Long Shelf Life

It places a natural barrier against competition and promotes your service to other agents in the office.

But how can you mimic, and do it better? Lots of companies give free stuff, i.e. pens, pads, trinkets, etc. You need to go a step further and give items that have longer shelf life, like building a wall of fame.

Attend your signings, you have a photo opportunity! After the client has finished signing documents, have the college take a group photo of the client, and you. And then you frame the photo with a testimonial from the client and hang the picture on your wall at your office. I guarantee that you’ll hang the picture and never take it down. Imagine decorating your wall with a picture from every signing? …Hence, the wall of fame.

Canada Day in Langley 2008

Canada Day has always been a great celebration, not the loud
brashness that you come to expect from the fourth of July, but a collection of
things that make this country so great. I started the day at the Langley Canada
Day Festival at McLeod Athletic Park. Langley Canada Day Celebrations has

grown to be the biggest two day event in the Langley’s and one of largest

Canada Day celebrations in the province.
http://www.langleycanadaday.ca/

It was hard to believe how much there was to offer, petting zoo’s,
continuous stage show, children’s rides/games, aircraft static displays,
Crafter’s Alley, Vendors, marketplace, special community exhibits by gymnasts,
firefighters, merchants and special community groups as well as live
musical entertainment from local talents.

RE/MAX
was out in full force as well, they sponsored the first aid
tent of course, they had a RE/MAX
balloon out
as well!!

One of
the more interesting things was a V8 Powered Custom
motorcycle from Azzkikr Customs http://azzkikr.ca/azzkikr/
can you imagine, how about towing your boat behind this one!!

But my personal favorite was the Dam’s Lincon Mercury

http://dams.dealerconnection.com/?lang=en

Monster Truck!!

This was a very popular ride! I wish I had waited in the enormous
line to get my chance, but alas it was too hot to stay put that long!

After the Canada day address I went to one of my favorite Pubs The Dubblin

Crossing in Langley/Surrey http://www.dublincrossing.com/home.html if you have never been GO!

It is quite the treat, they have my favorite Harp on tap, very hard to find anywhere

What good would living on the wet coast bring if we did not get to the beach??

I went chill’in http://www.tasteofwhiterock.com/articles/chill042007.html on White Rock Beach to soak up some of

the festivities on the beachfront and pier.

Just like the Langley festivities live music was a huge draw for the
White Rock crowd.

I was able to catch a set of the Sumner Brothers, one of my favorite local acts with special guest Jim Black on the Guitar,

at Chill’in I ran into some friends who work at Mercedes Benz of Vancouver, if you are in the market for a new Mercedes,

I whole-heartily recommend you see Adrian http://www.mbvancouver.com/index.cfm?id=3314

Looking forward to another great year in this beautiful Country, thanks to
everyone for making it a wonderful celebration.