What is amortization? It is the length of time it takes to repay your mortgage loan.

In Canada if you have 20% or less down then the maximum amortization you can do is 30 years. If you are putting 20% percent or more down then you have the option to go as high as a 40 year amortization.

When looking at an amortization schedule you will know that your fixed payment has a portion that goes to interest and a portion that goes to principle. Of course the name of the game is to pay less interest and effectively reduce the long-term amortization on my mortgage.

I am going to leave you with three good tips on how you can do that.

Number one:  change your monthly mortgage payments to accelerated bi-weekly or weekly payments. That in and of its self will really reduce your amortization.

The second one is consider setting your payment higher than what is required based on your qualification. A couple ways you look at that is if you are choosing a variable rate mortgage consider making your payment as if it was a five year fixed mortgage or if you happen to be coming out of a renewal or a refinance where you are already accustomed to making a higher payment with a lower interest rate, keep the higher payment. That really, really knocks down a lot of amortization. And finally, at Canada Mortgage Direct our inflation hedge mortgage strategy is an incredible tool where we make sure that as interest rates are changing and rising in the market place we continually optimize and change your payments accordingly, which of course adds more principle pay down to your mortgage.

Thanks for watching.

If you would like more information on this or other mortgage related topics contact Canada Mortgage Direct in one of the following ways:

Visit our website at CanadaMorgageDirect.com

You can phone our office: 403-250-2100

Or you can email us at Save@CanadaMortgageDirect.com

We would also like to invite you to the Canadian home Buyers Academy and you can visit us there at the CanadianHomeBuyersAcademy.com

Thanks again!

Related Topics: How Much Can I Afford? and What Strategy Are You Recommending?