Is Opportunity Knocking?

Is Opportunity Knocking?

Every once in a while opportunity seems to come knocking on our doors. Most of the time it goes unnoticed and other times it may seem that the opportunity is actually a threat. Every few years that opportunity is actually a big one.

Take the recent crash in the stock market. There’s a lot of people running to the safety of the bond market, or cashing out. What a shame! If you don’t need this money for more than 10 years you really should be buying these undervalued stocks. And if you needed the money in less than 10 years, you need to ask yourself why you were in the stock market in the first place. But I digress….

Back to the matter at hand: The current decline in stock prices may continue for a little while longer. If you would like to take advantage of the “sale” prices that many of these stocks are trading at you should be paying careful attention to the market, and get in when you think they’re near bottom.

So what do you do if you aren’t sitting on a stack of cash? Many people are sitting on thousands of dollars worth of equity in their homes that can be put to use towards buying investments. You can use that money to buy rental properties or stocks and bonds, and the interest is tax deductible. If you think you have 25% or more equity in your home and would like to use some of that money to buy investments, please give us a call. Secured lines of credit run at an interest rate of Prime + 0.5% (on average), and cost about $350 to set up. If the markets come back just 10% you will be “in the money.”

One thing is certain, the current decline has most economists predicting Variable Rates will remain low well into 2012, and it is likely we will see low fixed rates well into 2012 too. This is a great time to be borrowing money, especially if the money is invested.

Warm regards,
Chris
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Christopher Bisson
President and Mortgage Broker
The Mortgage Centre
519-763-3900 x1003

www.guelphmortgagecentre.com