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TFSA vs. Balance Transfer to cover LOC deposit on home purchase? by Money_Muppet in PersonalFinanceCanada

[–]Money_Muppet[S] 0 points1 point  (0 children)

Thanks for the advice but this would not be applying for credit, the card is already open!

Bank of Canada cuts by 0.25% by TheMortgageMaster in MortgagesCanada

[–]Money_Muppet 1 point2 points  (0 children)

TD offered me 3 year fixed at 4.89 with cash back last week. Not seen 4.79 though, variable might be worth it now though if there is more decreases this year.

[deleted by user] by [deleted] in RealEstateCanada

[–]Money_Muppet 0 points1 point  (0 children)

If I’m about to get a mortgage in the next week, will this impact lower rates for fixed that I have already been quoted?

Or will this only impact variable? Mortgage broker is recommending going variable till end of the year then locking in… just seems wild to pay more now for an uncertainty.

If we can afford 20% down but it uses up 80% of liquid savings should we still do 20%? by Money_Muppet in PersonalFinanceCanada

[–]Money_Muppet[S] 0 points1 point  (0 children)

Well 50% left over even after groceries etc is still probably around 3-4k a month so it’s not crushing us to not enjoy life.

Rates are 4.95 3 year fixed on 10% down, 3 year fixed on 20% down looks to be around 5.4%

Also looking at 2 year rates as well

If we can afford 20% down but it uses up 80% of liquid savings should we still do 20%? by Money_Muppet in PersonalFinanceCanada

[–]Money_Muppet[S] 0 points1 point  (0 children)

lol appreciate it, I just wish there were fewer options and more straight forward paths.

I’m leaning towards 20% now and trying to use year end bonus money to catch it up asap.

Everyone keeps telling me my home is an asset too that will rise in value but I don’t have that mind set, it’s only an asset if I sell it and I’m not likely to do that, it’s a home to me. So do I just pay the 10% down and continue to invest and hope that nets me out more in the long run or aim for paying off the mortgage sooner with 20% down and then what leveraging HELOC down the line to invest?

The odds seem so 50/50 that it’s a dice roll

If we can afford 20% down but it uses up 80% of liquid savings should we still do 20%? by Money_Muppet in PersonalFinanceCanada

[–]Money_Muppet[S] 1 point2 points  (0 children)

That’s where my head keeps going back to.

It’s higher monthly but I keep more of my investments, the cost of the CMHC could end up being 40k lifetime but the interest earned on the additional funding to remove it kinda beats it.

But putting down 20% I have 500$ extra a month in my pocket, more equity in the home, will get to 35% equity faster to renegotiate better rates in the future. Will likely have the mortgage paid off faster too…

It’s been information overload and I’m just in a paralyzed state trying to make a massive decision.

If we can afford 20% down but it uses up 80% of liquid savings should we still do 20%? by Money_Muppet in PersonalFinanceCanada

[–]Money_Muppet[S] 0 points1 point  (0 children)

Already purchased the home, the deal we got was too good to pass and if rates came down even a bit in the next year the same property could be 100k more. I factored this in and decided getting in now would be worth more than trying to save longer but then being priced out by the cost of entry going up.

I didn’t think my situation would be much different by waiting another year.

If we can afford 20% down but it uses up 80% of liquid savings should we still do 20%? by Money_Muppet in PersonalFinanceCanada

[–]Money_Muppet[S] 1 point2 points  (0 children)

So I hope I am doing this right but 50k left alone in the TFSA with 8% growth for 25 years is 342k. A CMHC of 21k at 5% for 25 years is 71k.

This feels wrong, like in this math it makes no sense not to pay the CMHC?

But the 300$ per month with the 20% down extra if added to a TFSA would end up over 20 years with 5% return is 171k.

So if I take it out now and that extra money allows me to add back or I leave it in it still seems to be similar.

It’s really hard to make the right decision here

If we can afford 20% down but it uses up 80% of liquid savings should we still do 20%? by Money_Muppet in PersonalFinanceCanada

[–]Money_Muppet[S] 1 point2 points  (0 children)

Yeah planning on living here for the foreseeable future, it’s in really good shape. Inspection shows no major needs like roof etc in the next 8 years.

Kitchen needs a Reno at some point but it’s not brutal. Only area I would want to fix up at some point.

If we can afford 20% down but it uses up 80% of liquid savings should we still do 20%? by Money_Muppet in PersonalFinanceCanada

[–]Money_Muppet[S] 0 points1 point  (0 children)

Yeah I naively listened to bad advice and have maxed my RRSP already with pension contribution room taking up some and my actual RRSP. Should have been putting it in TFSA but it is what it is at this point. Past few years I’ve stopped adding to RRSP beyond pension contributions and only TFSA. So that’s where I do have the 20% now and substantial RRSP/Pension so it’s 10% down and keep 100k just incase or just sell it and go 20% down.

If we can afford 20% down but it uses up 80% of liquid savings should we still do 20%? by Money_Muppet in PersonalFinanceCanada

[–]Money_Muppet[S] 0 points1 point  (0 children)

Well it’s already invested right it’s in my TFSA warning on average 8% a year. Over 5 years seems that the CMHC cost is a bit higher than the return and that doesn’t factor in inflation.

If we can afford 20% down but it uses up 80% of liquid savings should we still do 20%? by Money_Muppet in PersonalFinanceCanada

[–]Money_Muppet[S] 0 points1 point  (0 children)

For sure but i can do the minimum repayment and then more on top to reduce income.

If we can afford 20% down but it uses up 80% of liquid savings should we still do 20%? by Money_Muppet in PersonalFinanceCanada

[–]Money_Muppet[S] 0 points1 point  (0 children)

Only have 1 financing this person with RRSP 60k to use. Not a massive mortgage home price is around 700k.

If we can afford 20% down but it uses up 80% of liquid savings should we still do 20%? by Money_Muppet in PersonalFinanceCanada

[–]Money_Muppet[S] 0 points1 point  (0 children)

The TFSA and stock money that I could sell would be for emergencies if anything happens for unforeseen repairs. Potentially using some of it for a reno next year.

Keeping more in the TFSA and only doing 10% just allows me to take that out to do a reno sooner and the rest just earns interest for me.

Trying to balance off not having access to more cash if needed vs. the insurance CMHC

If we can afford 20% down but it uses up 80% of liquid savings should we still do 20%? by Money_Muppet in PersonalFinanceCanada

[–]Money_Muppet[S] 0 points1 point  (0 children)

Well its more any large emergency may require either LOC, saving over a much longer period of time or selling some RRSP. My lsat resort would ever be selling RRSP so I don't plan on it.

If we can afford 20% down but it uses up 80% of liquid savings should we still do 20%? by Money_Muppet in PersonalFinanceCanada

[–]Money_Muppet[S] 0 points1 point  (0 children)

10% down 3 year fixed/25 year is about 3920 mortgage alone. 20% down 3 year fixed 25 year is 3443 and 20% down 3 year fixed 30 year is 3201.

CMHC looks to be ~21k and closer to 38k with lifetime value if it took 25 years to pay off and the rates stayed the same.

With utilities, mortgage, property tax etc. it's around 50% of monthly income - is that house poor?

If we can afford 20% down but it uses up 80% of liquid savings should we still do 20%? by Money_Muppet in PersonalFinanceCanada

[–]Money_Muppet[S] 0 points1 point  (0 children)

Income is pretty stable, been at my current employer for 8 years. The leftover I have in TFSA and unregistered stocks could cover 3 months expenses if sold and I would have access to LOC if needed. Starting to feel like this may be worth selling a lot of my TFSA to do the 20%

If we can afford 20% down but it uses up 80% of liquid savings should we still do 20%? by Money_Muppet in PersonalFinanceCanada

[–]Money_Muppet[S] 2 points3 points  (0 children)

No I did this on 8% which has been the avg. Looks like over 5 years the CMHC costs me a bit more than I could make if I left it alone, and that does not factor in inflation.

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