New contest features Calgarian who has taken simple steps to pay off her mortgage sooner
TORONTO, March 7, 2012 /CNW/ - Scotiabank is aiming at helping Canadians own their home sooner with an innovative contest designed to raise awareness about best practices to achieve this goal, and relevant tools to help customers with the money part.
"Owning a home is one of life's biggest and best investments," said David Stafford, Managing Director, Real Estate Secured Lending at Scotiabank. "We've done the math. We know that while rates are important, reducing the length of the mortgage can really pay off. With tips, tools and awareness we want to help people own their homes in the most efficient time possible without it causing significant short-term sacrifice."
Consider a $200,000 mortgage amortized over 30 years at four per cent. Switch monthly payments to bi-weekly payments, and this small change can translate into paying the mortgage off about four years sooner with an overall savings of over $23,000 in interest. Increasing the payment on that mortgage by $10 - or 2 per cent - each year, takes another six years off and increases the interest savings to almost $48,000.
"Then there are periodic lump-sum payments when you have some extra money," noted Mr. Stafford. "Many people think it's only worthwhile when you have a large sum like 10 per cent of the balance, but it really can be any amount that's extra on top of regular mortgage payments, which ultimately means paying off the mortgage a little sooner. Every little bit counts, especially when interest is compounded over many years."
The Scotiabank Mortgage-Free Faster contest on Facebook features a calculator tool that helps Canadians identify the small changes and some best practices for paying off mortgages faster. A grand prize of a $25,000 mortgage pre-payment will be awarded to a new or existing Scotiabank mortgage customer and a secondary prize of $10,000 cash will be awarded to one eligible entrant. The contest runs through May 31, 2012 with grand and cash prize winners to be announced in the Fall.
"We developed the Mortgage-Free Faster Calculator to help Canadians identify small changes they can make towards paying off their mortgages faster and build savings for other things like travel, education or retirement," said Mr. Stafford. "A great real-life example of how small changes go a long way is embodied by Nicola Fox, one of our Calgary customers, who is following our mortgage-free faster tips to reach her goal of an early, mortgage-free, retirement."
Ms. Fox has taken simple steps over time to become mortgage-free faster. Steps include bi-weekly payments and making extra payments whenever possible. To kick off the contest, Scotiabank arranged for a surprise visit to her home by Calgary Flames Captain and Scotiabank Hockey Ambassador Jarome Iginla where she was presented with a $25,000 pre-payment on her mortgage. See her reaction here.
"I hope to retire at 55, and am following a financial plan tailored to help me reach this goal," said Ms. Fox. "A major part of early retirement depends on paying off our mortgage, and I've learned that paying off the mortgage faster doesn't automatically mean having to make drastic lifestyle-altering changes, but rather smaller, more manageable changes."
Scotiabank tips for Canadians who wish to pay off their mortgages faster include:
- Change your payment frequency from monthly to bi-weekly or weekly.
- Round up your mortgage payments to the nearest $50 or $100.
- Make one small lump sum payment each year, even $500 could have an impact.
- Increase your payments by small amounts, just two per cent per year can save you thousands in interest.
For more information and tips about Scotiabank's mortgage offers, suite of strategies and solutions please visit www.scotiabank.com.
Scotiabank is one of North America's premier financial institutions and Canada's most international bank. With more than 77,000 employees, Scotiabank and its affiliates serve some 19 million customers in more than 55 countries around the world. Scotiabank offers a broad range of products and services including personal, commercial, corporate and investment banking. With assets above $637 billion (as at January 31, 2012), Scotiabank trades on the Toronto (BNS) and New York Exchanges (BNS). For more information please visit www.scotiabank.com.
Video with caption: "Video: Enter Scotiabank's Mortgage-Free Faster Contest". Video available at: http://www.youtube.com/watch?v=85Yhc-D9O1I&list=UUhZVOf7W0UuXb-Ie7uuJxyg&index=8&feature=plcp
For further information:
Phone: (416) 866-3625
Email: [email protected]