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Globe and Mail
3 days ago
- Business
- Globe and Mail
The best time to make a lump-sum mortgage payment, according to the experts
Being mortgage free can seem like a distant goal when the outstanding balance is in the hundreds of thousands of dollars and most of your regular payments are going toward paying interest. But if you can afford it, financial experts say making additional lump-sum payments can help speed your path to being debt free. 'Making lump sum payments on your mortgage is a pretty powerful strategy to save on your interest and become mortgage free a lot sooner,' says Patty Hopper, a mobile mortgage specialist at Vancity in North Vancouver, B.C. By making a lump-sum payment on your mortgage in addition to your regular payments, you reduce the outstanding balance. This saves you cash in the long run because you'll no longer be paying interest on that amount. Hopper said a lot people don't have the extra cash flow to make an extra payment, but if you're lucky enough to receive a bonus at work or a tax refund, that can be used to make a lump-sum payment once a year. 'Any little bit is going to save you interest,' Hopper said. When mortgage rates were less than two per cent, the case for using extra cash to make additional payments instead of investing that money in hopes of making more than you were paying in interest was hard to make. But with higher interest rates combined with volatile stock markets, the case for trying to do better by investing the money versus the sure thing of paying down additional debt and saving on interest is harder to make. Mengdie Hong, a senior financial planner at RBC in Ottawa, said you want to compare your mortgage rate and expected return on the investments. 'In simple words, if your mortgage rate is higher than what you expect from your investment ... it may be best to allocate this excess cash to the mortgage, but if your expected return is noticeably higher than the mortgage, you may want to invest,' Hong said. Making lump-sum payments on your mortgage can also help keep any rise in your payments in check if you face a higher interest rate upon renewal, because your outstanding balance will be lower. And if you find yourself selling your home before you've fully repaid your loan, you'll end up with more cash in hand because of the lower amount you owed. 'You've got more cash on hand to make your next purchase or to move forward in the next leg of your journey,' Hopper said. The size of any lump-sum payment aren't without restrictions, which will vary between lenders. How much you can repay early and how often will be laid out in the documents you signed when you took out the loan. Both Hong and Hopper say extra payments on your mortgage shouldn't be made in isolation and must be considered as part of your overall financial plan. The status of your emergency fund, RRSP, RESP and TFSA contributions, and other debts all need to be considered. Hong said if you have other, higher-interest debt, such as outstanding credit card balances, that may be where you want to be making extra payments. 'So before you apply this lump sum, you may want to review all the debts that you have,' she said. Hong says paying down your mortgage and becoming debt-free sooner feels great, but you don't necessarily want to do it at the expense of flexibility. 'We always want to have flexibility and options in our financial plan,' she said.
Winnipeg Free Press
3 days ago
- Business
- Winnipeg Free Press
Got extra cash? Here's when experts say it's best to make a lump-sum mortgage payment
Being mortgage free can seem like a distant goal when the outstanding balance is in the hundreds of thousands of dollars and most of your regular payments are going toward paying interest. But if you can afford it, financial experts say making additional lump-sum payments can help speed your path to being debt free. 'Making lump sum payments on your mortgage is a pretty powerful strategy to save on your interest and become mortgage free a lot sooner,' says Patty Hopper, a mobile mortgage specialist at Vancity in North Vancouver, B.C. By making a lump-sum payment on your mortgage in addition to your regular payments, you reduce the outstanding balance. This saves you cash in the long run because you'll no longer be paying interest on that amount. Hopper said a lot people don't have the extra cash flow to make an extra payment, but if you're lucky enough to receive a bonus at work or a tax refund, that can be used to make a lump-sum payment once a year. 'Any little bit is going to save you interest,' Hopper said. When mortgage rates were less than two per cent, the case for using extra cash to make additional payments instead of investing that money in hopes of making more than you were paying in interest was hard to make. But with higher interest rates combined with volatile stock markets, the case for trying to do better by investing the money versus the sure thing of paying down additional debt and saving on interest is harder to make. Mengdie Hong, a senior financial planner at RBC in Ottawa, said you want to compare your mortgage rate and expected return on the investments. 'In simple words, if your mortgage rate is higher than what you expect from your investment … it may be best to allocate this excess cash to the mortgage, but if your expected return is noticeably higher than the mortgage, you may want to invest,' Hong said. Making lump-sum payments on your mortgage can also help keep any rise in your payments in check if you face a higher interest rate upon renewal, because your outstanding balance will be lower. And if you find yourself selling your home before you've fully repaid your loan, you'll end up with more cash in hand because of the lower amount you owed. 'You've got more cash on hand to make your next purchase or to move forward in the next leg of your journey,' Hopper said. The size of any lump-sum payment aren't without restrictions, which will vary between lenders. How much you can repay early and how often will be laid out in the documents you signed when you took out the loan. Both Hong and Hopper say extra payments on your mortgage shouldn't be made in isolation and must be considered as part of your overall financial plan. The status of your emergency fund, RRSP, RESP and TFSA contributions, and other debts all need to be considered. Monday Mornings The latest local business news and a lookahead to the coming week. Hong said if you have other, higher-interest debt, such as outstanding credit card balances, that may be where you want to be making extra payments. 'So before you apply this lump sum, you may want to review all the debts that you have,' she said. Hong says paying down your mortgage and becoming debt-free sooner feels great, but you don't necessarily want to do it at the expense of flexibility. 'We always want to have flexibility and options in our financial plan,' she said. This report by The Canadian Press was first published June 5, 2025.
Yahoo
3 days ago
- Business
- Yahoo
Got extra cash? Here's when experts say it's best to make a lump-sum mortgage payment
Being mortgage free can seem like a distant goal when the outstanding balance is in the hundreds of thousands of dollars and most of your regular payments are going toward paying interest. But if you can afford it, financial experts say making additional lump-sum payments can help speed your path to being debt free. "Making lump sum payments on your mortgage is a pretty powerful strategy to save on your interest and become mortgage free a lot sooner," says Patty Hopper, a mobile mortgage specialist at Vancity in North Vancouver, B.C. By making a lump-sum payment on your mortgage in addition to your regular payments, you reduce the outstanding balance. This saves you cash in the long run because you'll no longer be paying interest on that amount. Hopper said a lot people don't have the extra cash flow to make an extra payment, but if you're lucky enough to receive a bonus at work or a tax refund, that can be used to make a lump-sum payment once a year. "Any little bit is going to save you interest," Hopper said. When mortgage rates were less than two per cent, the case for using extra cash to make additional payments instead of investing that money in hopes of making more than you were paying in interest was hard to make. But with higher interest rates combined with volatile stock markets, the case for trying to do better by investing the money versus the sure thing of paying down additional debt and saving on interest is harder to make. Mengdie Hong, a senior financial planner at RBC in Ottawa, said you want to compare your mortgage rate and expected return on the investments. "In simple words, if your mortgage rate is higher than what you expect from your investment ... it may be best to allocate this excess cash to the mortgage, but if your expected return is noticeably higher than the mortgage, you may want to invest," Hong said. Making lump-sum payments on your mortgage can also help keep any rise in your payments in check if you face a higher interest rate upon renewal, because your outstanding balance will be lower. And if you find yourself selling your home before you've fully repaid your loan, you'll end up with more cash in hand because of the lower amount you owed. "You've got more cash on hand to make your next purchase or to move forward in the next leg of your journey," Hopper said. The size of any lump-sum payment aren't without restrictions, which will vary between lenders. How much you can repay early and how often will be laid out in the documents you signed when you took out the loan. Both Hong and Hopper say extra payments on your mortgage shouldn't be made in isolation and must be considered as part of your overall financial plan. The status of your emergency fund, RRSP, RESP and TFSA contributions, and other debts all need to be considered. Hong said if you have other, higher-interest debt, such as outstanding credit card balances, that may be where you want to be making extra payments. "So before you apply this lump sum, you may want to review all the debts that you have," she said. Hong says paying down your mortgage and becoming debt-free sooner feels great, but you don't necessarily want to do it at the expense of flexibility. "We always want to have flexibility and options in our financial plan," she said. This report by The Canadian Press was first published June 5, 2025. Craig Wong, The Canadian Press Sign in to access your portfolio
Yahoo
26-05-2025
- Business
- Yahoo
Servus Credit Union Now Canada's Largest Credit Union
EDMONTON, Alberta, May 26, 2025 (GLOBE NEWSWIRE) -- Servus Credit Union Ltd. (Servus) has officially become Canada's largest credit union by total assets, a historic milestone for the Alberta-based credit union and its members. This designation, as recognized by the Canadian Credit Union Association (CCUA), reflects years of disciplined operational decisions, a growing number of Albertans who bank with Servus, and the completion of a successful merger with connectFirst Credit Union on May 1, 2024. The milestone marks a major shift in Canadian credit union history — after more than four decades, the title of Canada's largest credit union has shifted from B.C.-based Vancity to Servus. This achievement is based on year-end 2024 results, as just reported by the CCUA. 'This is a proud moment for the entire Servus community – members and employees,' says Ian Burns, President and CEO of Servus Credit Union. 'It reflects years of hard work, smart decisions, and the trust that an ever-growing number of Albertans place in us. This milestone isn't just symbolic. It's national recognition that underscores the strength of the products, services and member-centric approach that we provide.' With a consolidated asset base nearing $30 billion, Servus is well-positioned to challenge traditional banking models and offer Albertans a compelling, cooperative, and values-driven alternative to the big banks. As the largest credit union in Canada, Servus has the size and strength to deliver value to its members through innovative offerings and personalized, locally made decisions. 'Every year, we see more Albertans and Alberta businesses turning to us for their banking needs. This is a testament to the power of the cooperative banking model and the value we offer – such as a 100 per cent deposit guarantee, profit sharing with members and recent enhancements to our digital banking platforms. If you're not already benefitting from these things, perhaps it's time to check us out,' says Burns. Burns notes the credit union's disciplined approach as a fundamental driver of this success, where a focus on stability and capital strength have set the stage for long-term success. Burns adds, 'Becoming Canada's largest credit union is a remarkable milestone, but our real strength lies in the long game — we will continue to make deliberate decisions to build lasting success for the good of our credit union and members, to progress the future of cooperative banking in Alberta.' Servus has a long-standing presence in Alberta, with 147 branches serving more than half a million members. From financial advisors helping members reach personal goals, to business banking experts supporting Alberta's entrepreneurs, to a Wealth Strategies team offering tailored investment advice – Servus is dedicated to helping its members feel good about their money. About Servus Credit Union Ltd. Servus Credit Union has recently merged with connectFirst Credit Union. The resulting entity has served Albertans for over 80 years with a full line of secure financial services. The financial institution has 147 branches in 80 communities throughout the province as well as options for online and mobile banking. For more information about Servus, call 1.877.378.8728 or visit Media contact:media@ in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Associated Press
14-05-2025
- Business
- Associated Press
Vancity Restores Profitability and Stays True to Its Co-Operative Values
In 2024, Vancity initiated a values-led transformation focused on improving member service and restoring profitability, while staying true to its co-operative values. The year marked a strategic reset under new CEO Wellington Holbrook, reaffirming Vancity's commitment to delivering modern, people-centered banking rooted in equity, inclusion, and climate action. Key initiatives included rolling out long-requested service upgrades and streamlining operations for greater efficiency. Despite economic headwinds, Vancity returned to profitability with $5.8 million in net income, and continued its community impact work—such as financing affordable housing and supporting climate-ready home retrofits and Indigenous entrepreneurs. Vancity's 2024 Annual Report, along with its Consolidated Financial Statements, Climate Report, Accountability Statements, and Sustainability Issuance Report, can be viewed here: The Climate Report outlines its strategic alignment with the Paris Agreement and UN Sustainable Development Goals, integrating climate action into its core strategy, risk management, and governance. The report highlights progress on emissions Accountability Statements outline Vancity's approach to managing key material topics and provide detailed data, disclosures, and impact Sustainability Issuance Report outlines the purpose, use, and impact of funds raised through its Sustainable Bearer Deposit Notes program. The report details how proceeds were allocated to eligible green and social investments under Vancity's Sustainability Issuance Framework. Report highlights include: Vancity's annual reporting is designed to promote transparency and accountability by openly reporting on how its actions impact people, communities, and the environment. 2024 reporting follows the International Integrated Reporting Framework and GRI Standards, and incorporates elements from IFRS S1 and S2, and the Sustainability Accounting Standards Board (SASB) standards. It is intended to meet the disclosure requirements of Vancity's membership in the UN Principles for Responsible Banking and was also guided by the disclosure requirements of the Net-Zero Banking Alliance (NZBA) and the Partnership for Carbon Accounting Financials (PCAF).2024 reporting reflects Vancity's dual focus on material financial risks and broader social and environmental impacts. It was shaped by ongoing member engagement and supported by external assurance of several key VancityVancity is a values-based financial co-operative serving the needs of its 570,000 member-owners and their communities, with offices and more than 50 branches located in Metro Vancouver, the Fraser Valley, Victoria, Squamish and Alert Bay, within the territories of the Coast Salish and Kwakwaka'wakw people. With $36 billion in assets plus assets under administration, Vancity is one of Canada's largest credit unions. Vancity uses its assets to help improve the financial well-being of its members while at the same time helping to develop healthy communities that are socially, economically and environmentally Contact: Media Relations Phone: 778-837-0394 Read More Visit 3BL Media to see more multimedia and stories from Alerts
