Portions: Flexibility for you
Manulife Bank Select offers you the flexibility to customize your mortgage -- and maximize your savings – with portions.
When you applied for your account, you could choose whether or not you wanted to divide your mortgage into portions. You will have the same opportunity when it’s time to renew your mortgage with us.
By dividing your mortgage into portions, you could:
- Reduce stress around rising interest rates – You can lock-in a portion of your mortgage at an attractive long-term fixed rate, while keeping a portion in a low variable rate to help you pay down your principal more quickly.
- Enjoy a lower effective interest rate – Interest rates are typically lower for shorter terms. You can make this work to your advantage. For example, if you split your mortgage between a one-year fixed term at 3 per cent and a five-year fixed term at 3.40 per cent, your effective interest rate would be 3.20 per cent for the next year, which is lower than if you chose just a five-year fixed term.
- Track a portion of your mortgage for tax purposes – Do you work out of your home? With Manulife Bank Select you could put part of your mortgage – an amount equal to the percentage of your home that you use as your office – in a separate portion. This allows you to track interest associated with that portion of your debt separately for tax reporting1.
- Reduce mortgage renewal risk –By splitting your mortgage into portions, you can renew your mortgage in steps over time, reducing the risk of higher rates at renewal time. Then, at renewal time, you can divide your mortgage into portions again to reduce future risk of rising rates.
For more information:
1Tax deductibility of loan interest depends on a number of factors. The Income Tax Act provides the framework for determining tax deductibility. Please consult your own tax and legal advisors regarding your personal circumstances.