Mortgage Flashcards
1
Q
Mortgage
Reasons to keep and rearrange
Keep
Return
Investments would have to be in Equity or property long term to be able to beat interest cost on mortgage
ATR-these investments may suit or not suit ATR
Liquidity -to encash assets may lose liquidity
Tax -to encash assets may have tax implications
A
Rearrange
Efficiency -Is it most efficient way to repay loan
Interest rate -could lower rate be obtained
Flexibility -use more flexible contract regular/adhoc payments reduce speed up
Cash HRT payer use cash funds to repay loan
Balance of deposit account doesn’t eat. Interest so no tax payable
offset mortgage against balance of loan to reduce debt
