Mortgage Glossary

Increasing Your Payments

Most lending institutions will allow you to increase the amount of your mortgage payment, some allow an increase once per year others only once per term. The amount of this increase varies from 10% to 20% depending on the lending institution. For example: If your present mortgage payment is $1,000 per month you may be able to increase it to $1,200 per month ($1,000 X 20% = $1,200). The extra payment amount reduces your mortgage principal, therefore paying your mortgage off faster. The disadvantage of this benefit is that the increase is usually permanent (until your next renewal date), so you have to be very sure that you can afford this increase. Please discuss the current policies of the different lending institutions with your mortgage broker.

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