High interest account

[Manhattan]

Trying to save up a down payment so can't afford to lose the principle and want to minimize risk. Best rate banks are offering is 1.2% for no term deposits. Any recommendations on a better rate?

[Sugarphreak]

...

[roopi]

Canadian Tire offers 1.5%

[dj_rice]

PC Financial is offering 2.6% for Apr 15-Aug 15 period.

[Xtrema]

If you think the purchase is more than 15months away, term GIC is 1.7% to 1.8%.

But since I assume this is outside of a tax free portfolio, interest is subjected to taxes, 1/2 a percent point isn't that big of a deal when you lose the flexibility going with term.

[jwslam]

ING is 2.5% between now and June 30 before it drops down back to 1.35.

On another note, you and I can both make $25 for you opening an account there =)

[skandalouz_08]

Originally posted by Xtrema
If you think the purchase is more than 15months away, term GIC is 1.7% to 1.8%.

But since I assume this is outside of a tax free portfolio, interest is subjected to taxes, 1/2 a percent point isn't that big of a deal when you lose the flexibility going with term.

Most GIC's require a lump sum amount to get started and don't allow monthly contributions to it. Assuming OP is saving a set amount monthly a savings account is a better option than a GIC account unless of course he has a lump sum now to invest and has the time horizon.

[BrknFngrs]

Originally posted by skandalouz_08


Most GIC's require a lump sum amount to get started and don't allow monthly contributions to it. Assuming OP is saving a set amount monthly a savings account is a better option than a GIC account unless of course he has a lump sum now to invest and has the time horizon.

Depending on your bank, "special offer" type GICs can be a great way to go. When I was banking a downpayment I would purchase a $500 (this was the minimum required) 100-Day GIC each pay period, worked great.

[skandalouz_08]

Originally posted by BrknFngrs


Depending on your bank, "special offer" type GICs can be a great way to go. When I was banking a downpayment I would purchase a $500 (this was the minimum required) 100-Day GIC each pay period, worked great.

Just going from the ING website, any GIC's less than 1 year have a rate that is less than the savings account they offer. That's why I said a savings account is probably a better option. Better rate and not locked in.

[thetransporter]

be warned with ING and paypal - ING will CLOSE your account sometimes using paypal. and Aly Bank does not allow paypal.

[Frankie88]

Take 30-39% off all the above return. GICs investment return are fully taxed on your marginal tax rates, my 1.5% return is cut to 61%, so roughly around 1% after CRA take their CUT. :banghead:

[Strider]

After Ally was bought out by RBC, I think the next best one is Canadian Direct Financial, 1.90%
https://www.canadiandirectfinancial.com/Personal/

[Xtrema]

Originally posted by Frankie88
Take 30-39% off all the above return. GICs investment return are fully taxed on your marginal tax rates, my 1.5% return is cut to 61%, so roughly around 1% after CRA take their CUT. :banghead:

That's what I'm trying to say, 1.2 vs 1.9 is effectively a 0.5% difference after CRA is done with with you.

or $50/year on $10K.

[BoostinAround]

Do you guys really invest money at these rates?

Geez....PM me if you have more than 10K, and I will give you 4%-8%, secured by Alberta real estate at <85% loan to value or less.

Same with RRSP's

[ZenOps]

http://blogs.reuters.com/felix-salmon/2012/06/11/cnbc-graphic-of-the-day-greek-bond-yield-edition/

Pssshhh.. Greek 2 year bond at 350% was the bomb, that is until of course - they defaulted and you got zero back.

Currently I think a reasonable percentage is the German 2-year bond at -0.03%. Germany has a very strong economy of the Eurozone, and will absolutely crush the rest of Europe in this economic war.

BMO seems to be doing higher risk deposits, much like South Korean banks. For about 3.5% you can risk it all on the chance that the bank will not go insolvent before you can get your rate of return.

http://www.bloomberg.com/news/2012-06-18/suicides-arrests-show-trouble-at-korean-savings-banks.html

Her savings would be protected by state-run Korea Deposit Insurance Corp., which guarantees as much as 50 million won at both savings banks and larger lenders. Still, the additional 40 million won bond investment she made on behalf of her mother would be wiped out.

“I wish it were a bad dream,” said Je, pulling her trimmed black hair behind her ear while attending a KDIC meeting on claiming restitution for the savings later that week. “I always wondered what kind of stupid people put precious money into messy banks. Now, I am one of them.”

Je recalls getting a text message in September 2010 from Korea Savings pitching five-year notes yielding 8 percent annually. It was easy, the bank promised. She invested her mother’s savings, four times as much as her own, in bonds that aren’t protected by deposit insurance.

“How can I tell my 80-year-old mother I’ve lost the funds she lives on?” she said. “I was deluded by a couple of percentage points of interest rate. Now I can see it was only a trap.”

Oh, the pain of not doing homework on what the world situation is.

[Sugarphreak]

...

[BigMass]

Originally posted by BoostinAround
Do you guys really invest money at these shitty rates?

Geez....PM me if you have more than 10K, and I will give you 4%-8%, secured by Alberta real estate at &lt;85% loan to value or less.

Same with RRSP's

how is that effected if the real-estate market crashes?

[skandalouz_08]

Originally posted by BoostinAround
Do you guys really invest money at these shitty rates?

Geez....PM me if you have more than 10K, and I will give you 4%-8%, secured by Alberta real estate at &lt;85% loan to value or less.

Same with RRSP's

And how liquid is this investment? I believe the point of saving to buy a home is to have access to your money when you're ready to buy and not have it tied up in real estate.

[Sugarphreak]

...

[Xtrema]

Originally posted by Sugarphreak


Is this a promotional rate or something that will drop in a few months?


*All rates quoted are annual interest rates and are subject to change without notice.

But that's not bad for TFSA rates.

[Strider]

Originally posted by Sugarphreak


Is this a promotional rate or something that will drop in a few months?

It's not a promo or teaser rate, but like any other high interest savings account it's subject to change without notice.
Like how Ally dropped from 2% to 1.8% the day after I funded my account :banghead: and has now been eliminated after the RBC acquisition.

There's a few credit unions in BC and Manitoba that still have 2% HISA, but they're not CDIC insured like the Canadian Direct Financial one.

[Sugarphreak]

...

[BoostinAround]

Responses:


Sugarphreak - You mean investing with a company that operates similar to Concrete Equities?
-------------------
I have no experience with Concrete Equities. I am talking about borrowing money ON real estate, like a Bank would do. Myself or my real estate investment company would be the borrower. I buy cashflowing real estate and can use the funds to purchase more. The money is secured on the property by a mortgage, and you make monthly income from the payments.

You are in the "bank" position, you are the one giving a mortgage to someone on a property.

BigMass - how is that effected if the real-estate market crashes?
--------------------
With cashflowing real estate, the market can be whatever price it wants, it doesn't substantially affect your monthly income (although there is a chance with a market "crash" that rents would go down, but the property would still be producing monthly income) I would be more concerned about a market crash and having my money elsewhere.


skandalouz_08 -
And how liquid is this investment? I believe the point of saving to buy a home is to have access to your money when you're ready to buy and not have it tied up in real estate.
-------------------
It is as liquid as a GIC. YOU as the lender decide the term you want to lend the money out for. Typical is 6-12 months for "short term" and can be as long as 5 years depending on what you as the lender have to lend in terms of $$, and the terms you want.


There are a lot of good real estate deals that require short term money, just to sometimes close the deal, fix up the property then refinance. So once the property is brought up to a higher level, your higher rate interest mortgage gets refinanced with typical bank financing.

[Xtrema]

Originally posted by BoostinAround
Responses:


Sugarphreak - You mean investing with a company that operates similar to Concrete Equities?
-------------------
I have no experience with Concrete Equities. I am talking about borrowing money ON real estate, like a Bank would do. Myself or my real estate investment company would be the borrower. I buy cashflowing real estate and can use the funds to purchase more. The money is secured on the property by a mortgage, and you make monthly income from the payments.

You are in the &quot;bank&quot; position, you are the one giving a mortgage to someone on a property.

BigMass - how is that effected if the real-estate market crashes?
--------------------
With cashflowing real estate, the market can be whatever price it wants, it doesn't substantially affect your monthly income (although there is a chance with a market &quot;crash&quot; that rents would go down, but the property would still be producing monthly income) I would be more concerned about a market crash and having my money elsewhere.


skandalouz_08 -
And how liquid is this investment? I believe the point of saving to buy a home is to have access to your money when you're ready to buy and not have it tied up in real estate.
-------------------
It is as liquid as a GIC. YOU as the lender decide the term you want to lend the money out for. Typical is 6-12 months for &quot;short term&quot; and can be as long as 5 years depending on what you as the lender have to lend in terms of $$, and the terms you want.


There are a lot of good real estate deals that require short term money, just to sometimes close the deal, fix up the property then refinance. So once the property is brought up to a higher level, your higher rate interest mortgage gets refinanced with typical bank financing.

Ok, so you are funding a mortgage company.

Your income is amortized interest or short term interest.

Unless you are charging more interest than the bank which means you are funding bank rejects, how do get more than 3-4% return?

I know there are companies out there funding projects at 7-10%, using the lot as collateral when the developer can't get other funding options.

[Sugarphreak]

...

[max_boost]

Oh man I sure have heard that $10K line and guaranteed XX% of interest a few times. I've asked on Beyond if anyone has invested in any company or know of anyone who has invested and gotten their money back and no one has said a thing.

I made a $10K investment about 6 years ago and still waiting to see the money. I will be sure to post up here when I do lol

[psycoticclown]

I've actually invested in a company like that 5 years ago, 11% interest paid every month and it actually worked out. Got my principle back a few days ago and always got interest every month. Basically you're lending money to somebody to buy real estate and collecting interest.

[CanmoreOrLess]

How can anyone in Alberta be in the real estate investment (cough) ponzi game and not know Concrete Equities? Red flags are a waving. Now it occurs to me he is probably uninformed of Ponzi:

http://en.wikipedia.org/wiki/Ponzi_scheme

OP just buy nickels, I thought we were all on board here on Beyond.

[HiTempguy1]

Originally posted by psycoticclown
I've actually invested in a company like that 5 years ago, 11% interest paid every month and it actually worked out. Got my principle back a few days ago and always got interest every month. Basically you're lending money to somebody to buy real estate and collecting interest.

I'm sure it sometimes works, hell, if you are on the correct side of a ponzi scheme you are also in the clear.

If you were going to invest in someone elses rental properties, why not just do it yourself? Take out a mortgage on a inexpensive, new condo and rent it out. :dunno:

[max_boost]

Originally posted by psycoticclown
I've actually invested in a company like that 5 years ago, 11% interest paid every month and it actually worked out. Got my principle back a few days ago and always got interest every month. Basically you're lending money to somebody to buy real estate and collecting interest.

Nice man.

The $10K investment after 5 years I be looking at around a $23K payout! I'm sure as hell down with that haha Just hit the 5 year mark but got a letter about 6 months ago saying they weren't forecasting a payout for another 18-24 months so I guess just gotta be patient.

As for the investment itself it's the http://www.wildflowerranch.ca/ Beyond OG/budding star ZorroAMG hooked me up with it. It made sense to me so that's why I jumped in and for $10K, what the heck. Will post when I collect. haha

[BoostinAround]

Xtrema

Ok, so you are funding a mortgage company. ---I am looking for funds to buy deals. I also privately lend my money out on real estate

Your income is amortized interest or short term interest. --- Simple interest payments typically. Keeps it simple

Unless you are charging more interest than the bank which means you are funding bank rejects, how do get more than 3-4% return? Just because you charge higher interest, does not mean you are funding rejects. Big 5 banks will typically only give you a mortgage up to about 6 properties, when you own more than that, you need to look at other options

I know there are companies out there funding projects at 7-10%, using the lot as collateral when the developer can't get other funding options. yup, and that range is typical for real estate projects.

------------------------

Sugarphreak

Concrete equities is (was) an investment company that invested in cashflowing real estate and you recieved returns based on market value of the properties when they were sold and rental payments for space leased out.

Of course it turned out to be a giant ponzi scheme that came tumbling down due to the purple tie wearing douchebags running it... like virtually all real estate investment firms.

I looked them up after, and it's too bad that a few make a bad name for all. Saying that all real estate investment firms are ponzi schemes is a big generalization.

It's not that they are a ponzi scheme, Concrete Equities just screwed people out of their money plain and simple.

I read that like 3 times and I can't figure out if you are buying real estate and collect rent, or lending money to somebody to buy real estate (like a bank would) and collecting interest. Or maybe you are saying you are taking other peoples money to invest in real estate and then collecting funds on that?

This makes me believe you are either being intentionally misleading or not able to explain it more clearly; which probably means you own a couple of purple ties

I will break it down for you:

What I said before: (I am talking about borrowing money ON real estate, like a Bank would do. Myself or my real estate investment company would be the borrower. I buy cashflowing real estate and can use the funds to purchase more.)

So I am the borrower, looking to borrow funds at 4-8% for real estate projects. This would make the person lending me the money via a mortgage on the property essentially like the bank. They are registered on title, and money is secured by an asset.

I also lend out my private cash as mortgages to people who are looking to borrow.

I was not trying to be misleading and thought I was being clear so just to clarify:

I am looking to borrow money at 4-8% for my real estate projects.
When I have extra cash I also lend out my own money.
I am not taking other peoples money to lend out on their behalf.

It is a simple transaction where the Lender give the money to the lawyers, the lawyer registers the documents, and the Borrower gets the money.


Does that make sense?

------------------

psycoticclown

I've actually invested in a company like that 5 years ago, 11% interest paid every month and it actually worked out. Got my principle back a few days ago and always got interest every month. Basically you're lending money to somebody to buy real estate and collecting interest.

Yup, that is exactly it. Very simple transaction

--------------------

CanmoreOrLess

How can anyone in Alberta be in the real estate investment (cough) ponzi game and not know Concrete Equities? Red flags are a waving. Now it occurs to me he is probably uninformed of Ponzi:

http://en.wikipedia.org/wiki/Ponzi_scheme

OP just buy nickels, I thought we were all on board here on Beyond.

I am not in the "real estate ponzi game". I am in the buying properties for investment and mortgage game. I am also in Edmonton and just never heard of them.
Yes, there are bad investment companies out there, so be careful. It sounds like from what I read they were offering you to buy into their company or holdings for a return, which is much different than just lending someone money via a mortgage.

[TrevorK]

Originally posted by max_boost
Oh man I sure have heard that $10K line and guaranteed XX% of interest a few times. I've asked on Beyond if anyone has invested in any company or know of anyone who has invested and gotten their money back and no one has said a thing.

I made a $10K investment about 6 years ago and still waiting to see the money. I will be sure to post up here when I do lol

I myself have invested in Carevest and never had an issue when I withdrew my money. While not a 100% sign they are legit you will see signs advertising their projects onsite ("financed by Carevest"). They don't return near 10% now (I assume closer to 6-7%) but might be an option if you want to take a little more risk.

If you're looking to learn more about it I would contact them, their model makes sense as some of their primary clients are companies looking to start development because they have a much harder time securing a loan from a bank (as he only equity they have is the land). You buy into a pool of mortgages to reduce your risk. At the time I had invested I believe they had a record of no defaults on their mortgages.

[94boosted]

Is this too good to be true? 3.0% TFSA

http://www.peoplestrust.com/high-interest-accounts/todays-rates-3/

Peoples Trust seems to be insured by CDIC

http://www.cdic.ca/Pages/Members.aspx

Their rate seems to be leaps and bounds better than anyone else's (next best is ING w/ 2.5%)

In December I pulled all of my TFSA money out of my shitty RBC TFSA which wasn't earning me much and am looking for a better TFSA.

[G]

Did you know you can hold stocks and etfs in your TFSA as well right?

[94boosted]

^ yup

I do have other investments but I like my TFSA to be a quick & easy savings account.