Mortgage payments earn Aeroplan points, but at a cost.
mortgage-rewards-program
Introduction to Mortgage Rewards Programs
The Canadian mortgage market has seen a new development with the introduction of a mortgage rewards program that offers Aeroplan points for mortgage payments. This program, launched by Chexy, provides one Aeroplan point per dollar paid, which may seem like a great incentive for borrowers. However, it’s essential to consider the program’s 1.75% fee and whether the benefits outweigh the costs. As a mortgage broker in Ontario, I’ll analyze the implications of this program for various types of borrowers.
How Does the Mortgage Rewards Program Work?
The program allows borrowers to earn Aeroplan points on their mortgage payments, which can be redeemed for travel and other rewards. However, to come out ahead, borrowers must consistently redeem their points above the program’s 1.75% fee. This means that borrowers need to carefully consider their mortgage strategy and whether this program aligns with their financial goals. For instance, borrowers in Toronto, Richmond Hill, or Vaughan may have different priorities when it comes to their mortgage payments.
Implications for Homebuyers
For first-time homebuyers in Ontario, this program may seem appealing, but it’s crucial to weigh the benefits against the costs. With the current mortgage rates in Canada, homebuyers may want to focus on securing the best mortgage rates rather than earning rewards points. Additionally, homebuyers should consider the mortgage stress test in Canada and how it may impact their ability to qualify for a mortgage. As a mortgage broker, I always advise homebuyers to prioritize their mortgage strategy and consider factors like fixed vs variable mortgage rates and the overall cost of borrowing.
Implications for Refinancers and Investors
For refinancers and real estate investors in Ontario, this program may offer more benefits. Refinancers can earn rewards points on their mortgage payments while also taking advantage of current mortgage rates in Canada. Investors, on the other hand, may be able to earn points on multiple properties, which could add up to significant rewards. However, it’s essential to consider the program’s fee and whether it aligns with their investment strategy. Investors in cities like Mississauga, Brampton, or Ottawa should carefully evaluate the program’s potential benefits and drawbacks.
Mortgage Renewal Considerations
For borrowers nearing mortgage renewal in Ontario, this program may be worth considering. By switching to a mortgage with a rewards program, borrowers may be able to earn points on their renewed mortgage. However, it’s crucial to evaluate the overall cost of the mortgage, including the program’s fee, and compare it to other options available in the market. As a mortgage broker, I always advise borrowers to review their mortgage strategy and consider factors like fixed vs variable mortgage rates and the impact of Bank of Canada interest rates on their mortgage.
Key Takeaways
* The mortgage rewards program offers one Aeroplan point per dollar paid, but with a 1.75% fee
* Borrowers must consistently redeem points above the program’s fee to come out ahead
* The program may be more beneficial for refinancers and investors than first-time homebuyers
* Borrowers should prioritize their mortgage strategy and consider factors like fixed vs variable mortgage rates and the overall cost of borrowing
FAQ
Q: How do I earn Aeroplan points with the mortgage rewards program?
A: You earn one Aeroplan point per dollar paid on your mortgage payments.
Q: What is the program’s fee?
A: The program’s fee is 1.75%.
Q: Is the program available for all types of mortgages?
A: The program’s availability may vary depending on the type of mortgage and the lender.
Practical Advice for Borrowers
To make the most of the mortgage rewards program, borrowers should:
* Carefully evaluate the program’s fee and whether it aligns with their financial goals
* Consider their mortgage strategy and whether the program offers benefits that outweigh the costs
* Compare the program to other options available in the market, including fixed vs variable mortgage rates and other rewards programs
* Consult with a mortgage broker to determine the best course of action for their individual situation
Conclusion
The mortgage rewards program may seem like a great incentive for borrowers, but it’s essential to consider the program’s fee and whether the benefits outweigh the costs. As a mortgage broker in Ontario, I advise borrowers to prioritize their mortgage strategy and consider factors like fixed vs variable mortgage rates, the overall cost of borrowing, and the impact of Bank of Canada interest rates on their mortgage. By carefully evaluating the program and considering their individual situation, borrowers can make informed decisions about their mortgage and achieve their financial goals.
Looking for personalized mortgage advice in Ontario? Explore our mortgage services or book a free consultation with Kia.Mortgage today.