Don't Sell Your House--Ever!
by: Neeraj Varma
Keeping your existing house when you buy a new one could be THE
most profitable financial decision you could make. Consider the following:
1. Second stream of income: When you move to another place and keep
your current house as a rental, this gives you an extra stream of
income.
2. Pay less tax: Your rental property produces business income.
When you have a business, you are entitled to tax write-offs. This
could save you a lot of money that you would normally pay to CCRA
(Revenue Canada).
3. Fast wealth: Tenants will pay off your mortgage in a rental property.
Your net-worth will grow without you having to save out of your own
income. When you have one or more tenants there is a team effort
in building your wealth, fast!
4. Bargain priced: You will never again be able to buy the same
type of property for the amount you paid for it originally. The value
of all the other houses have gone up along with yours. You already
own what an investor would consider a bargain in the current market.
5. High rate of return: The rent you can charge for your house is
based on the current market. Rents have gone up but the cost of your
house is still what you originally paid for it. You are getting a
higher return on investment. In the current market you would have
to spend a lot more to get the same rental income.
6. Guaranteed income: If you are willing to make some small changes
to your house so it meets the standards required for disabled people,
you will have a long list of potential tenants waiting for you. In
many cases, some government agency will be paying their rent. You
will get a good, stable, low-maintenance tenant. You will also be
helping someone in need. If you need money for the renovations, you
can re-finance as much as 90% to 100% of the market value of your
house. Government grants may also be available.
7. Increased tax write-offs: In most cases, you can write off the
interest paid on the mortgage of a rental property. If you keep the
mortgage as high as possible, you maximize the tax write-offs.
8. Pay off your own home faster: Keep the mortgage on the rental
property as high as possible by re-financing to the max as the value
goes up. Use that equity to pay off the home you live in, faster.
9. Tax-free retirement income: After your house is paid off quickly
by using the equity in the rental property, you may be able to use
the refinanced cash as a tax-free retirement income. Borrowed money
may or may not be taxable. Check with your accountant.
10. Gain freedom from the slavery of a J.O.B.: It takes far less
time to maintain rental properties than the amount of time you would
spend in a job. If you build up your portfolio of rental properties
to 5 or 10 and pay them off (or keep refinancing), you will have
as much or more income than your present job. You can be your own
boss, work only a few hours, spend time with your family, and really
enjoy your life.
These strategies will not work for everyone. Before you implement
your plans, check with an accountant, lawyer, mortgage broker or
other professional. You may need to work with someone. Use your children,
parents, brothers, sisters, good friends as a co-signer or co-investor.
Grow wealthy together, with the people you love.
To qualify for the lowest mortgage rate in
Canada, go to http://www.mortgage-rate-canada.com and click on
Canadian "Mortgage Calculators". Check out
the "Pre-Approvals" and "Credit Problems" pages
to get the banker's perspective on your credit profile.
For ideas on how to set up a reliable monthly income from rental
properties when you have very little time or money go to: http://www.netman-ecommerce-guru.com/rental-strategies
Warm Regards,
Neeraj Varma
Mortgage
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