Frequently Asked Questions
We've compiled some of the more common questions we receive from clients and listed them out below in an effort to help you quickly find the answer you're looking for. If you still need help, please contact us and a mortgage consultant would be more than happy to assist you.
Questions
Answers
How do I know if I qualify for TDMP?
A mortgage specialist will let you know if you qualify for the plan, but there are a few basic guidelines.
First off, you should currently own a home and have built up at least 20% equity. It is possible for new buyers to qualify, but this will require a consultation with a mortgage specialist.
Your outstanding mortgage balance should be at least $100K.
You should be employed (or self-employed) with good credit.
These are guidelines only. Visit the Do I Qualify section and complete a secure online application for a complete review.
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How is TDMP viewed by CRA (Canada Revenue Agency)?
TDMP has been successfully reviewed by CRA (Canada Revenue Agency) and endorsed by economists, financial planners and financial institutions. It is a legal and common practice to deduct interest when you borrow to invest to produce income.
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Are the Tax Refunds really Free?
Yes. By converting your mortgage into a tax-deductible loan, you are turning the interest into a tax deduction. When you subtract that deduction from your income, you get a tax refund. That refund is free money. You do not have to invest any of your own income or increase your debt to get the tax refund.
The refund you receive from investing in RRSPs is not free money. You pay for your RRSP by using your own after-tax income to buy the tax refund.
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Should I wait for my mortgage to mature?
If your mortgage is going to mature within 1 year, it may make sense to wait for maturity. If maturity date is beyond 1 year, engaging TDMP now rather than waiting makes the most sense because you will benefit from Tax Refunds right away.
A TDMP Certified mortgage agent can help with this decision by providing detailed financial projections based on your current situation.
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How can you pay off your mortgage sooner?
The best way to pay your mortgage sooner is to take advantage of your prepayment privileges and maximize your early payments.
This is exactly what happens when you engage TDMP! The pre-payments do not come out of your pocket, they are a component of the self-funding Tax Deductible Mortgage Plan. As a result, your mortgage will be paid off significantly sooner which means you save thousands of dollars!
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