[OhGreatGuru]

Have a thought and would love some opinions

what if I borrowed enough from some flush parents to payoff our mortgage (it is quite large) and came to an agreement to pay them off over say 30 years with a fixed rate of say in between 4.5 and 5%, is the interest they receive on their loan to us taxable by CRA?

They complain about small yields in safe investments - we are as stable as you get interms of jobs - and I know what my rate is for decades not half decades...

Thoughts??

Very risky for the parents. 30 years may be beyond their life expectancy. Lending big money to relatives is fraught with risk. How are they going to collect if you default for any reason?

The fact that you are even thinking about a 30 year mortgage suggests you are living beyond your means.

OTOH: Having said all that, there are societies and families where this is done. The mortgage should be a debt against any share you expect from your parents' estate (if that share is large enough), or alternatively the outstanding amount needs to be payable to the estate on your parents' death. They need to discuss this with a lawyer and/or estate planner. But economically, it still does not make sense for them to lock into a fixed 30-yr. term at those rates, unless they were planning to make it renewable periodically.

 

[OhGreatGuru]

No. You asked for opinions. I gave mine. But I suggest you look at the total repayment costs for 15, 20, 25, and 30 year mortgages, and tell us why you think a 30 year mortgage is a good idea.