Tuesday, May 31, 2011

This pile of bricks...is ours alone.

So we just paid off our mortgage. Today. In just under 4 years.

A little background info for my American readers - mortgage interest in Canada is not tax deductible. I mean, you have the option of borrowing against the equity in your home and investing that, then deducting the interest from your income tax, which is a complicated way of making your mortgage interest tax deductible. But while we pay $0 capital gains tax on the sale of our primary residence, we don't get the benefit of making our payments tax deductible in the interim.

In addition, one weird little thing that NO ONE TALKS ABOUT is that our mortgage rates effectively reset every 5 years. We have amortization periods of up to 35 years (where 25 is standard) but we negotiate our mortgages for 5 years at a time. So those teaser rates that so screwed many Americans? Yeah - most Canadians don't know what an awful ride they're in for. I am so scared for my compatriots. No joke. And we have no excuse; we see what's happened south of the border. Do not get me started. We have liar loans. We have sub-prime mortgages that are -- wait for it -- back-stopped by the Canadian taxpayer. It's a GONG SHOW, and it's about to get ugly.

ANYWAY, we bought our house in May of 2007 and took possession in August. We opted for a fixed rate mortgage because rates were inching up at the time. No one predicted the craziness of late '08/early '09, after all. Our mortgage had some cool provisions - we could increase our payments by 25% AND pay up to 25% of the original value of our mortgage ever year as a 'pre-payment'. We immediately upped our payments, and set about putting down extra money each year.

I must be honest - we didn't do it without some help. I was one of the beneficiaries of my late Aunt Floriana's life insurance and pension. The money I received was plunked down on the mortgage. My parents also gave me some money from my Grandma & Grandpa's estate, which we also plunked down. But we've been saving like fiends to pull this off.

We'd managed to reduce our remaining amortization to 1 year 5 months with our renewal due in 1 year 3 months. I knew we'd be hit with a penalty to pay it off, so I thought we'd just wait it out and pay our usual payments. I called in last week to see how much I would have to pay now so that I could reduce the amortization to 1 year and 3 months (i.e so we'd owe nothing at the end). But it was then I found out that the lender would be willing to waive the penalty! We owed less than our permitted annual prepayment (that 25%) so other than the required $250 discharge fee, all we had to pay was the remaining amount. I had more than that amount sitting in their bank, so today we arranged a transfer. We're saving over $1500 in interest over the next year and 3 months. Also - no more mortgage payments!

In 60 days, we'll receive our official documents showing only our names on the title. But as of tomorrow morning, my online account will show that my mortgage is CLOSED. We are pretty excited. We celebrated by busting open a bottle of wine we'd brought back with us from our trip to Australia.

In other news - Veronica is finally interested in table food. And she's on the cusp of crawling. Big day around these parts!

Tuesday, May 24, 2011

Something for Arwen and Bryan

We interrupt this slowly evolving birth story with a request.

Most of you reading this either know or know of my friend Arwen. If you aren't reading her already, you really should be because she is amazing. As is her husband, Bryan. They are even more wonderful in person than online, a fact that Dave and I were lucky enough to discover last summer.

A few months ago, I talked a bit about how they were about to add TWINS to their family. And on May 12th, the identical twin boys arrived. Let me tell you - that night, awaiting their birth and trying to get the #moshertwins hashtag to trend was one of my favourite ever moments on Twitter! Linus Michael and Ambrose John were born a wee bit too early and are still in the NICU. Arwen and Bryan are total stars and are doing amazingly well with all this juggling. And since we can't all be there to help in person, we thought we'd do the next best thing - put together a Spiritual Bouquet for the Mosher Family.

I would love it if you'd head on over to this blog and contribute to the spiritual bouquet. I'd also love it if you could spread the word. The more prayers and wishes, the better.

We love you, Arwen and Bryan. Enjoy!