Let's resolve... to clear these holiday bills and start building wealth!

Most Canadians suffer with their highest personal debt load in January, when the “holiday hit” arrives and our credit card statements let us know just how much we spent on the festive season. It’s especially hard if you already had a burgeoning debt load before the holidays.

This year, make the best New Year’s resolution ever: resolve to clear that debt, and start building wealth. With the right plan in place, this year could be the beginning of a strong new financial life. Start now, and every month you could be seeing the difference: a boost to your monthly cash flow, one easy payment, faster debt paydown, and potentially thousands of dollars in interest savings.

We can show you how to use your home equity to consolidate your high-interest debt into a new or existing mortgage. In almost every case, you’re better off rolling large amounts of high-interest debt into a mortgage. Why? Because we are benefiting from mortgage rates that continue to be among the lowest in decades. Just compare mortgage rates with what you’re paying on your credit cards and other debts.

First we’ll do an assessment of your situation. Here’s an example – mortgage, car loan and credit cards total $225,000. Roll that debt into a new $233,000 mortgage, including a fee to break the existing mortgage, and look at the payoff:

Current Situation*

Monthly payments on $175,000 mortgage - $969
Monthly payments on $25,000 car loan - $495
Monthly payments on $25,000 in credit card balances - $655

Current total monthly payments: $2,119

New Situation*

Monthly payments on $233,000 mortgage (debts + early payout penalty on mortgage) - $1,176
Monthly payments on paid off car loan - $0
Monthly payments on paid off credit cards - $0

New total monthly payments: $1,176

That’s $943 less each month! Now decide how to use that $943. If you put $500 into your mortgage payment, you’ll reduce your amortization from 25 years to 15. Or you could invest in RRSPs or RESPs and reap some tax benefits. Or consider putting some funds aside each month into a “December” fund – so you never have the financial pain of that “holiday hit” again!

It’s a new year. Make it the start of a new financial life. We’d love to help you crunch some numbers to see what kind of life you could be living, something to really celebrate about next New Year’s Eve!


~ Powered by Mortgage Intelligence

*4.5% current mortgage, 3.6% new mortgage, 25 year am. Credit cards 19.5% and car loan 7%, both at 5 year am. OAC. Subject to change. For illustration purposes only.

Photo credit: [c] Asif Akbar for stock.xchng