February 2024 - Dominion Lending Centres

Your payment schedule is the frequency that you make mortgage payments and ranges from monthly to bi-monthly, bi-weekly, accelerated bi-weekly or even weekly payments. Below is a quick overview of what each of these payment frequencies mean:Monthly Payments: A monthly payment is simply a single large payment, paid once per month; this is the default that sets your amortization. A 25-year mortgage, paid monthly, will take 25 years to pay off but includes the added burden of one larger payment coming from one employment pay period. With this payment frequency, you make 12 payments per year.Example: $750k mortgage, 3-year fixed rate, 5.34%, 30-year amortization you would have a monthly payment of $4,156.19. No term savings; no amortization savings.

Bi-Weekly Payments: A bi-weekly mortgage payment is a total of 26 payments per year, calculated by multiplying your monthly mortgage payment by 12 months and divided by the 26 pay periods.

Example: $750k mortgage, 3-year fixed rate, 5.34%, 30-year amortization you would have a bi-weekly payment of $1,915.98 with term savings of $177 and total amortization savings of $1,769.

Accelerated Bi-Weekly Payments: An accelerated bi-weekly mortgage payment is also 26 payments per year, but the payment amount is higher than a regular bi-weekly payment frequency. Opting for an accelerated bi-weekly payment will not only pay your mortgage off quicker, but it’s guaranteed to save you a significant amount of money over the term of your mortgage. This frequency also allows the mortgage payment to be split up into smaller payments vs a single, larger payment per month. This is especially ideal for households who get paid every two weeks as the reduction in cash flow is more on track with incoming income.

Example: $750k mortgage, 3-year fixed rate, 5.34%, 30-year amortization you would have accelerated bi-weekly payments of $2,078.10 with term savings of $1,217 and total amortization savings of $145,184. Plus, you would save 4 years, 12 months of payments by reducing scheduled amortization.

Weekly Payments: Similar to monthly payments, your weekly mortgage payment frequency is calculated by multiplying your monthly mortgage payment by 12 months and dividing by 52 weeks in a year. In this case, you would make 52 payments a year on your mortgage.

Example: $750k mortgage, 3-year fixed rate, 5.34%, 30-year amortization you would have weekly payments of $957.50 with term savings of $253 and total amortization savings of $2,526. You can move to accelerated weekly payments to save even more!

Prepayment Privileges: In addition to fine-tuning your payment schedule, most mortgage products include prepayment privileges that enable you to pay up to 20% of the principal (the true value of your mortgage minus the interest payments) per calendar year. This can help reduce your amortization period (the length of your mortgage).

By exercising your prepayment privileges, you can take time off your mortgage. For instance:

Extra $50 bi-weekly is $32,883 total savings and an additional 1 year, 2 months time saved
Extra $100 bi-weekly is $62,100 in total savings and an additional 2 years, 3 months time saved on your mortgage
Extra $200 bi-weekly is $111,850 in total savings and an additional 4 years, 1 month of time saved on your mortgage.

Understanding the different payment frequencies can be key in managing your monthly cash flow. If you’re struggling to meet a large payment, breaking it up can be effective; while the same can be true of the opposite. Individuals struggling to make a weekly or bi-weekly payment, may benefit from one monthly sum where they have time to collect the funds.

Contact a Dominion Lending Centres mortgage expert for more information or download our My Mortgage Toolbox app from Google Play or the Apple Store and check out the different payment calculator !

Written by my DLC Marketing Team

They say the kitchen is the heart of every home, and what better way to treat this important space than by ensuring you have all the right materials?When it comes to your kitchen, there are a variety of options for cupboards, appliances, and countertops. What you may not realize, is how much you actually utilize your countertop space and the importance of choosing the right material for your cooking habits and style.

If you are considering a reno, or looking to purchase a new home, understanding the pros and cons of different countertops can ensure you make the best choices.

Granite: A popular and durable option, granite comes in various colors and patterns. Along with being strong, it is resistant to heat and abrasion. However, it is a premium-price material and requires regular sealing every three to five years due to its porous nature.
Marble: One of the more high-end options, similar to granite, marble provides a much-needed level of uniqueness in its patterns as well as holding up well to heat, cracking, and chipping. On the other hand, marble is more sensitive to scratches and staining and should be resealed at least once per year to improve longevity.
Quartz: One of the most durable and maintenance-free countertop options, quartz comes in various options from vibrant to natural finish and is nearly indestructible under standard home conditions. Not only is quartz scratch-resistant, but it can also resist stains, bacteria, and heat damage.
Laminate: If you’re looking for a more budget-friendly option, laminate can be a great way to go. Not only can laminate be made to resemble stone, granite, or even quartz at a fraction of the cost, but it is also easy to clean and maintain while being resistant to mold, mildew, and stains. However, bear in mind that laminate is quite sensitive to heat and can be prone to peeling or scratches.
Butcher Block (or wood): Butcher-block wooden countertops have a great natural look while being a hardworking surface great for food prep and highly resistant to heat. However, as wood is quite porous it is important to properly seal and oil your countertops to reduce bacteria and moisture susceptibility.
Stainless Steel: Opposite the natural look of butcher-block designs, stainless steel provides a much more industrial kitchen vibe. Stainless steel has become extremely appealing over the years due to the ease of wiping it down and its ability to inhibit bacteria buildup. However, not without its limits, stainless steel has a tendency to result in lots of water spots and fingerprints on its smooth surface. It is also more pricey than other options, but being impervious to heat damage has its charms.
Soapstone: A wonderfully stain-resistant option, soapstone is entirely non-porous in addition to being heat and bacteria-resistant. However, to maintain this natural stone it needs to be treated regularly with oil and care must be taken to avoid surface damage such as scratches and dents.
Ceramic Tile: Tile is an inexpensive option for your kitchen (and bathroom) counters, which is easy to install by an experienced do-it-yourselfer. Not only is tile inexpensive, but it comes in a variety of options and colors as well as being hard, durable, and resistant to heat. Keep in mind, the sizing of your tiles as smaller tiles will be more difficult to clean as opposed to larger settings. Tile is also more vulnerable to cracking, though relatively easy to replace a broken piece. It is also important to note that grout can be prone to staining.

Regardless of what type of kitchen you are designing or moving into, knowing how to care for your countertops can help increase your kitchen longevity and enjoyment!

Written by my DLC Marketing Team

Month: February 2024

Choosing Your Ideal Payment Frequency.

Countertop Materials for your Kitchen.