The Cash Flow Dam (Cash Damming) Explained
For the Smith Manoeuvre and tax minimization enthusiasts out there, you may have heard about The Cash Flow Dam (or cash damming). Cash Damming is a fancy phrase for a fairly simple concept that can help optimize your taxes if you have a mortgage and a personal small business.
What is The Cash Flow Dam?
The Cash Flow Dam is tax arrangement that allows a personal small business owner (sole proprietor/partnership) to pay down their non-deductible mortgage faster. In other words, it is a variation of the much discussed Smith Manoeuvre, without the investing, that helps convert bad debt into good debt.
How Does it Work?
Cash Damming uses a line of credit to pay for business expenses while taking the increased business cash flow to pay down a non-deductible mortgage/loan. This results in a growing tax deductible business loan, and an accelerated pay down of a non-deductible mortgage. This only works with a non-incorporated/personal/partnership small business.
For example, say you had a small business with $1,000/month in expenses and a readvanceable mortgage. The $1,000/month expense would be paid by the home equity line of credit (HELOC), and the extra $1,000 sitting in your business account now would be used to pay down your non tax deductible mortgage. The key to this strategy is that interest paid on borrowed amounts used for personal business expenses are tax deductible. In the end, you’ll have a large tax deductible business loan and no mortgage.
Some of you may be thinking that this new loan just created a new monthly interest expense in addition to the existing mortgage payments. The new interest expense can be avoided by capitalizing the interest. That is, use the business line of credit to pay for itself which keeps the account tax deductible while using $0 of your own cash flow. You can read more about capitalizing the interest here (with diagram).
How is Cash Damming different than the Smith Manoeuvre?
Cash damming uses business expenses to enable the loan to be tax deductible whereas the Smith Manoeuvre uses investments. The Smith Manoeuvre is on the riskier side as it involves leveraged investing into public equities.
Applications
- Rentals - If you are a rental investor, instead of using your own cash flow to pay for expenses, cash damming would involve using a line of credit instead. This strategy will essentially allow your rentals to pay for your personal mortgage while keeping the tax man happy.
- Self Employed/Side Business – If your personal company isn’t incorporated, and your monthly expenses are fairly high, then the cash flow damn can convert your non-deductible mortgage into business loan fairly quickly. The net after tax result is a much lower overall interest cost.
I’m not a tax professional. Any information in this article should be taken for its entertainment value only. A professional accountant should be consulted before implementing the strategy above.
41 Comments, Comment or Ping
1. Four Pillars
Good explanation – I didn’t know what that was called. I was debating on doing something similar for my blog next year since I have relatively high expenses (for a blog) – Mr. Cheap doesn’t come cheap and my wife also helps out and is on the payroll.
Nov 24th, 2008 @ 10:16 am
2. FrugalTrader
Great idea FP. Have you looked into incorporating your online business?
Nov 24th, 2008 @ 10:31 am
3. Four Pillars
I’ll consider it but for now the revenues are too low to make it worthwhile. Hopefully that will change in the future. :)
Nov 24th, 2008 @ 11:08 am
4. nobleea
So how does it work for rentals. Is the entire mortgage payment (P+I) considered a valid business expense? Or just the interest? Or is is the full amount and then you pay taxes on the capital gain when you sell (if you do)
I suppose it’s much easier if you have a seperate LOC for tracking. I wonder how hard the paperwork would be if you used a LOC that you also used for other purposes.
Nov 24th, 2008 @ 12:04 pm
5. FrugalTrader
Nobleea, AFAIK, any interest paid to service a business loan is also tax deductible. So I can’t see why you wouldn’t be able to use a line of credit to pay the rental mortgage. However, with that said, I’m not sure that you could capitalize the interest on that LOC because that would be 3 layers.
IMO, any LOC used for business/investing should be kept separate.
Nov 24th, 2008 @ 12:08 pm
6. Four Pillars
You absolutely HAVE to keep any LOC used for business separate from any personal use. I got caught on this one last year because my former bank (TD) screwed things up. I had to sell some stock, wait 30 days and rebuy. I didn’t get audited or anything like that but it was still something I had to deal with.
The problem with mingling funds is that if you make any payments to the principal, it is not clear whether you are paying down the deductible debt or the non-deductible debt. This is not something you can “designate” or assume it is in proportion to the amounts of deductible and non-deductible debt.
Nov 24th, 2008 @ 12:37 pm
7. nobleea
yeah, that makes sense.
is it possible to split an existing LOC in to two accounts? it’s a HLOC so it’s registered against the property.
also, does it matter if the LOC used is against the rental property? or is that just using your equity how you see fit?
Nov 24th, 2008 @ 12:43 pm
8. Four Pillars
Good question about splitting the LOC – I think this is dependent on the product you use. I have Firstline Matrix which does not allow sub-accounts but I know there are other LOCs out there which do. I suppose one could pay the fees and get another secured LOC set up.
I don’t think it matters how you use the money from the LOC – as long as it is used for investment in businesses of some sort. Stocks, rental properties, blogs, any other business – they are all eligible.
On an unrelated topic – if you have capital losses from stocks – is there a limit to how many years you can carry it forward?
Nov 24th, 2008 @ 1:10 pm
9. nobleea
FP;
Don’t quote me, but I think capital losses can be carried back 3 years and carried forward indefinitely?
Nov 24th, 2008 @ 1:13 pm
10. mjw2005
Is this not just robbing Peter to pay Paul…I am trying to wrap my head around this. Forgive my ignorance here. I am self employed but have very little overhead so this may not apply to my situation….
What do you mean by capitalizing the loan…..I get your diagram in relation to someone using borrowed money for Stock Investments….but how as you say does one capitalize the loan for a small business so that the small business pays the loan itself with you paying nothing…..I don’t get it…confused…..
Nov 24th, 2008 @ 1:57 pm
11. FrugalTrader
mjw,
This is basically what happens:
Make sense?
Nov 24th, 2008 @ 2:00 pm
12. FrugalTrader
FP, nobleea is right on the money.
http://www.taxtips.ca/filing/capitallosses.htm
Nov 24th, 2008 @ 2:12 pm
13. Four Pillars
MJW – yes, you are robbing Peter to pay Paul, however if Peter can’t write off the interest and Paul can, then there can be some benefit.
Nov 24th, 2008 @ 4:39 pm
14. The Financial Blogger
Quite interesting strategy. I actually have a few client that has it in place (mostly with rental properties) and it works perfectly.
In fact, I wonder when do government get taxes from rental properties income? There are so many ways to avoid/defer taxes with rental properties :-)
There are a few banks offering HELOC with split accounts.
Nov 24th, 2008 @ 11:21 pm
15. Kevin
Hi Everyone,
I’ve been looking into this quite a bit the past couple of days. Here are 2 links with valuable info. One is just another explanation of how to do it, the other is a link to the CCRA’s website with their explanation and the rules on it.
http://howtobesetforlife.com/Reports/CashFlowDam.pdf
http://www.cra-arc.gc.ca/E/pub/tp/it533/it533-e.pdf
Hope this helps a bit
Nov 25th, 2008 @ 5:17 am
16. Kevin
oh and MJW,
you are Robbing Peter to pay Paul but you are paying down the principle on your own mortgage which eliminates your personal debt quicker. At first it’s not the easiest thing to understand but if you consider that the income doesn’t dissapear and your overall debtload is decreasing at the same pace as it previously was but you are transferring your bad debt to good debt.
Nov 25th, 2008 @ 5:24 am
17. cannon_fodder
Just a note… I created a Smith Manoeuvre calculator some time ago and the link has been located on this website. http://home.cogeco.ca/~pgannon/investment/Readvanceable_Mortgage.xls
It supports the use of Cash Damming if you want to see how it may work in your particular situation.
Cash Damming can be, obviously depending on how large your business expenses are, the fastest way to convert your non-deductible mortgage into deductible debt. This could easily save you thousands of dollars per year for many years.
Nov 25th, 2008 @ 10:09 am
18. Elbyron
1. Can I use the HELOC to pay for the principal portion of the rental property’s mortgage, or am I limited to using the HELOC only for expenses that are already considered tax-deductible, such as the interest portion of the mortgage?
2. Is the interest on funds borrowed to pay a down-payment on a rental property considered to be tax-deductible? (I would draw from a HELOC on my principal residence)
3. Which spouse can claim the tax deduction for a jointly-borrowed HELOC? If this is based on who is on the title for the rental property, then what are our options if we’re both on the title?
Feb 6th, 2009 @ 2:53 pm
19. lint
hoping for an update the Elbyron’s comments as well. I’m a little confused on what can be deemed an expense for the purposes of cash damming with a rental property.
May 14th, 2010 @ 7:59 pm
20. FrugalTrader
Elbyron, lint, these questions should be confirmed by an accountant, however, this is my understanding:
1. I’m not sure about this one, but it would make sense to use the HELOC to pay for interest deductible portion only. For example, when I capitalize the interest on my investment loan, I use a loan to pay the interest only.
2. Yes, you can use a heloc to pay the down payment on an income property and still make the tax deduction. Same as if you buy a stock with a HELOC, the interest is deductible.
3. I believe you can “choose” which spouse you want to claim the deduction. It depends on who is “servicing” the loan, whoever is paying for it should be the one claiming the deduction/income. If both are paying, then you can choose whichever spouse makes the most tax sense.
Again, i’m not a tax pro, so it would be in your best interest to run these questions by an accountant.
May 15th, 2010 @ 8:58 am
21. Ed Rempel
Hi Elbyron & lint,
1. You can use the HELOC to pay all the deductible expenses of the rental property, plus the principal portion of the mortgage payment. Borrowing to pay the principal portion of your mortgage payment is essentially the same as transferring the loan from your mortgage to the HELOC, so if the mortgage is deductible, then transferring the debt or paying the mortgage from a HELOC would still be deductible.
2. Yes. FT is right.
3. For accounting and tax purposes, the expenses must be matched up to the income. Whichever spouse claims the investment on their tax return most also claim the interest on money borrowed to invest in it.
May 15th, 2010 @ 5:57 pm
22. FrugalTrader
Thanks for the clarification Ed, I was going to send you these questions via email. :)
May 15th, 2010 @ 6:17 pm
23. lint
for expenses I see mortgage (p+i), utilities, property tax, insurance, maintenance. which ones are deductible?
May 15th, 2010 @ 7:45 pm
24. Ed Rempel
Hi lint,
Expenses for the Cash Dam are the same as expenses for income tax purposes. That would include generally any reasonable expense specifically related to the rental unit, including all the ones you mentioned.
The only exception for deductibility is the principal portion of the mortgage payment, which is not deductible, but you can borrow to pay it as part of the Cash Dam.
Ed
May 16th, 2010 @ 1:40 am
25. lint
thanks Ed. Having some discussion with my accountant on what can be considered a deductible expense, and this supports my case.
May 17th, 2010 @ 1:43 am
26. Sebastien
As part of trying to understand how cash damming works, I came across this article, see the section “The Donald (Trump, that is)” at http://www.mortgagebrokernews.ca/industry-talk/the-tax-tips-and-traps-you-should-know-now/43645, it says:
“Legitimate expenses for use of proceeds on the business loan clearly extend to mortgage interest, property taxes, insurance and management fees. However, principal payments on the investment property mortgages are not a valid expense and the Donald needs to ensure that any principal mortgage payments are funded separately and specifically not funded through the rental cash dam.”
I was wondering if this was corroborating or not what you Ed and lint were discussing, I was under the impression that we can apply the cash dam to the entire rental property mortgage i.e. when borrowing from the HELOC to pay the mortgage (principal + interests) of the rental property, that the interests were tax deductible (if borrowing for the down payment is tax deductible, why borrowing for principal portion of the mortgage wouldn’t?), but I’m a bit confused now after reading this article, any thoughts on this?
Thanks,
Seb
Jun 15th, 2010 @ 12:54 am
27. Ed Rempel
Hi Sebastien,
The article from the mortgage broker you quoted is not correct.
Reborrowing to pay the entire rental mortgage is tax deductible, but for 2 different reasons.
The Cash Dam allows reborrowing to pay for expenses, which would only include the mortgage interest.
Reborrowing to pay the mortgage principal is essentially refinancing a tax deductible loan. If a loan is tax deductible and you take a new loan to pay it off, the new loan is generally deductible as well.
For example, if you borrow on a credit line to reduce your rental property mortgage, the credit line interest on that borrowed amount would also be tax deductible. That is essentially what you are doing when you pay the mortgage principal in the Cash Dam.
Ed
Jun 18th, 2010 @ 12:57 am
28. Sebastien
Thank you very much Ed, that’s very helpful as there is all sorts of conflicting information out there as you saw in that article. A few other questions:
1. Can the HELOC used to do the down payment on the rental property be the same as for the cash dam (as both are tax deductible) or if for accounting purpose the CRA would like to see 2 separates HELOC in this case (even if they are both related to the rental property)? You mentioned I think in another post that we need 2 separates HELOC when doing the Smith Manoeuvre and a cash dam, was wondering if this was the same reasoning for down payment vs. cash dam?
2. What happens when we sell the rental property? If we just keep the HELOC (or not reimburse it completely), at that point is the HELOC still tax deductible until it is completely reimbursed?
3. Are the actual rental property expenses still tax deductible in addition to the interests on the HELOC or if that would be considered double-dipping?
Thanks,
Sebastien.
Jun 18th, 2010 @ 6:26 pm
29. Ed Rempel
Hi Sebastien,
1. The HELOC used for the down payment can also be used for Cash Dam. This is because in both cases, the amount borrowed is used for the rental property and claimed on the rental property statement on the tax return.
2. Under the “Disappearing Source Rules”, if you sell the property and pay 100% of the proceeds onto the credit line, the interest on any remaining balance would continue to be deductible as long as you maintain that balance separately.
This is a further advantage of the Cash Dam, since the part of the amount borrowed with the Cash Dam may remain deductible even after selling the property.
3. Yes, of course the actual rental property expenses are also deductible.
Think of it this way. Let’s say you are unable to find a tenant for a year, but continue to pay all the expenses of the building. If you borrow on your credit line to pay those expenses, then that credit line interest would be tax deductible.
That’s all the Cash Dam is really – borrowing to pay the expenses. Most people use the rent to pay the expenses, but CRA says specifically that you can use the rent for other purposes and borrow all the money to pay the expenses.
Ed
Jun 18th, 2010 @ 11:18 pm
30. Sebastien
Thanks Ed,
So technically it shouldn’t matter what we do with the money after the sell of the rental property, like reimbursing the rental mortgage and/or investing in something else, as long as we don’t borrow again from that HELOC used for the cash dam, I would assume that everything is fine?
I’m now trying to evaluate the pros and cons of starting a cash dam with my rental property, for my principal house I’m currently on a STEP with Scotiabank for another 2 years, my current mortgage is at prime – 0.5, the HELOC is at prime + 1, so currently with prime at 2.5% with a marginal tax rate of 40% it pretty much break even now in terms of after tax loan cost, but as the interest rate will go up the tax deductible loan will probably slowly become efficient… especially if in 2 years I can transfer my STEP to another bank with better rates ;-)
Sebastien.
Jun 19th, 2010 @ 12:49 pm
31. Ed Rempel
Hi Sebastien,
After you sell the rental, you should immediately pay the cost onto your credit line. If you reinvest it in something else, you should separate this into a new credit line.
This is because you existing credit line is deductible against rental income. If you sell and pay the cost down, any remaining amount would still be claimable against rental income. However, if you reinvest in something else, such as stocks or mutual funds, then that interest would be deductible on a different line on your tax return, so you should split that credit line.
How long are you planning to keep your rental property, Sebastien? That would be the main consideration for evaluating the Cash Dam. With today weird rates, the immediate tax savings may be minor, but here is the key point – the amount you reborrow this year is tax deductible every year, as long as you own the rental property.
So, once rates normalize, this should be a benefit for you for years. The amount deductible grows every year.
Just to be clear, the projected benefit of the Cash Dam far smaller than the Smith Manoeuvre, since it is purely a tax strategy. The SM is a leveraged investment strategy, plus a tax strategy. However, since the Cash Dam is purely a tax strategy, there is no downside other than doing the transactions and tracking them.
It’s like claiming a tax deduction. There is no downside to claiming it.
Your mortgage discount from prime is .5%, which should be a bigger discount soon. Also, your credit line is at prime +1%. Some banks are already at prime +.5%, and secured credit lines at prime are likely to return as interest rates normalize.
Ed
Jun 21st, 2010 @ 12:48 am
32. Sebastien
Hi Ed,
The plan would definitely be to have one HELOC just for the down payment/cash dam and never use it for any other purpose, a separate HELOC would be used for investments. I’m actually not sure how long I will keep the rental property, the PITA factor might play a big role here, the rental property mortgage now is 1 year fixed to keep my all my options open, I’m going to reevaluate every year. So maybe I should wait a little then to see what kind of discount rate I can get in a year or 2 (when I have the chance to renegotiate my principal mortgage, I heard it’s not easy though to transfer a STEP to another financial institution) before starting a cash dam? Would there still be an advantage of doing it now with my current mortgage at prime – .5, HELOC at prime + 1 even if there is a small chance I might sell earlier (1-5 years)?
Thanks,
Sebastien
Jun 23rd, 2010 @ 7:22 pm
33. Ed Rempel
Hi Sebastien,
If you are thinking of selling the rental, then starting the Cash Dam is probably not worth it. The benefit starts small and builds, but only becomes a big number over time.
If it is just a “small chance” that you would sell, then the sooner you start the better. There is no real problem moving it or moving from a STEP to another bank. Just have the Cash Dam credit line start with the same balance you transfer out.
Ed
Jun 24th, 2010 @ 12:46 am
34. Sebastien
Hi Ed,
The problem I see now with the STEP is that although we can open up to 3 lines of credit (e.g. 1 for down payment and cash dam on rental property, 1 for investment, 1 for personal expenses), only 1 can be automatically readvanceable (at least that is what the bank told me), so in this case it might be hard to combine a cash dam with e.g. a smith manoeuvre, how would that work assuming I wanted to do both?
Regarding the actual implementation of a cash dam, assuming a new bank account was opened just for the rental property operations, can that same account used to deposit the rent be also used to deposit the borrowed money from the line of credit to pay rental expenses or if they have to be 2 separates bank accounts?
And how those 2 strategies (cash dam and smith manoeuvre) does affect the credit score since HELOC from a STEP is reported to credit agencies?
Thanks,
Sebastien
Jun 27th, 2010 @ 11:58 pm
35. Ed Rempel
Hi Sebastien,
While Cash Dam is a cool tax strategy and a simple concept, implementation can be tricky.
You need to either increase your mortgage payment by the amount of the rent, or accumulate it in an account somewhere and make an annual mortgage prepayment.
If you are doing both the SM and Cash Dam, you will probably need a slush fund or extra credit line for the amount you want to readvance each year.
You should decide which one is more critical (or which one converts more to tax deductible) and automatically readvance that one. For the other one, you can either ask your bank to transfer the available credit each month, or you can borrow it on an unsecured credit line for a year and then have the available credit transfered.
For example, if you decide that the Smith Manoeuvre is priority (since it is both an investment and tax strategy), then you can automatically readvance the SM. Then you can borrow the Cash Dam rental expenses on an unsecured credit line for a year. You should then have a lot of available credit in the SM credit line (because it is automatically readvancing both amounts each month), so you can then ask your bank to transfer the available credit from the SM credit line to the Cash Dam credit line.
You cannot mix the rent with the rent expenses. The Cash Dam allows you to keep them separate and use them for separate purposes, but once you mix them, you cannot do Cash Dam.
These strategies should have only a minor effect on your credit score, unless you have quite a few separate credit lines. Having 1 or 2 additional credit lines should not have a major effect. They also result in your mortgage being paid down faster, which could help your credit rating.
Ed
Jun 29th, 2010 @ 10:37 am
36. lint
Ed, can you clarify this point? “You cannot mix the rent with the rent expenses. The Cash Dam allows you to keep them separate and use them for separate purposes, but once you mix them, you cannot do Cash Dam.” I’m not clear what this means from an accounting perspective.
Thanks
Jun 29th, 2010 @ 12:08 pm
37. Ed Rempel
Hi lint,
The entire concept of the Cash Dam is you can use your rent or business income for a purpose other than paying the rental or business expenses. For example, you can use the income to pay down your mortgage and borrow money to pay the expenses.
Most people use their rental/business income to pay their rental/business expenses. However, CRA specifically allows you to borrow money to pay all the expenses. For example, if you had no income for a few months and borrowed money to pay the expenses, the interest would be deductible.
Then you can use your rental/business income to pay down your mortgage. If you have a readvanceable mortgage, then paying down the mortgage will automatically create credit available that you can use to borrow to pay your expenses.
If you use your rental/business income to pay the expenses, then you have already not done the Cash Dam, since it is a method of keeping them separate.
Does that answer your question, lint? I’m not sure exactly what you mean by “from an accounting perspective”. Do you mean the transactions or the tax issues?
Ed
Jul 1st, 2010 @ 9:21 pm
38. lint
Hi Ed,
I was looking for a clarification on your post that I quoted, specifically this part “but once you mix them, you cannot do Cash Dam.”
Does this mean that if you use part of the rental income to pay some of the rental expenses, you cannot do Cash Dam? If so, why not? I can see that this would complicate the accounting, but your comment sounds like Cash Damming is all or none.
Jul 2nd, 2010 @ 1:49 pm
39. Tommy
Hi Ed,
I am a bit confused by “but once you mix them, you cannot do cash dam” comment from you.
I currently have 3 revenue properties since last year. I wasn’t aware of the Cash Dam strategy as I have 3 separate accounts for rents to go in and expense to come out. With Cash Dam strategy, I can use the rent income to pay my personal mortgage and personal LOC (non-deductible). If I had known last year, I would have saved myself quite a bit of taxes as I reported a net income of $10K (due to extremely low interest rate).
After hearing the benefit of Cash Dam, I want to start implementing the strategy.
My plans are:
1) Refinance my current mortgage to access more HELOC, and also set up an readvanceable LOC for Smith Manuver (for investments)
2) Use my personal line of credit to pay the rental expenses
*the personal LOC has had many transactions, but if I can use rental income to repay all of debt.. can I still use this LOC for Cash Damming? (of course moving forward, there will only transactions going OUT to pay rental related expenses)
*also, can you clarify that if I use personal LOC to pay mortgage payments, will I be able to write off 100% interest? (since mortgage payments contain a portion of principal)
3) pay down my all personal LOC and accelerate mortgage paydown on personal residence
Thank you!!
Tommy
Jul 4th, 2010 @ 12:51 pm
40. Ed Rempel
Hi Tommy,
I don’t completely understand your situation. Do you have only one personal credit line? If so, then there is a problem with your method.
To make your line of credit tax deductible with the Cash Dam, you should transfer the entire balance somewhere else, so that you start with zero. Then use it only to pay expenses for your rental properties.
The rent cannot go into this same credit line, since then you have used it to pay the rental expenses. Deposit the rent somewhere else and then use it to pay off some non-deductible debt.
The key point is that the rent income needs to always stay separate from the account where you borrow to pay the rent expenses.
Yes, your credit line will be deductible if you pay your entire mortgage payment with it. Paying the interest is deductible with the Cash Dam. Paying the principal portion is really just transferring the deductible debt from your mortgage to your credit line.
Ed
Jul 4th, 2010 @ 10:39 pm
41. Tommy
Hi Ed,
I now have two personal line of credits. I have a bit of balance on both. My plan is to use one of them for Cash Damming purpose. My question is do I really need to set up another LOC (and cancel my original one) to make this work? I am selling some stocks to repay one of my personal LOC and make that my cash damming LOC. If I pay down the LOC to “zero balance”, can I just start using this account for cash daming? Of course, moving forward there will only be one transaction a month where I transfer some funds to cover my operating expenses. There will be previous transactions.. but they are not related to my cash damming. It’s just like TD may want to pull credit and go through loan process again… it’s annoying.
After reading your suggestion, my plan is:
1) open up a new chequing account for operating expenses (set up automatic withdrawals of mortgage payments, property taxes, condo fee etc)
2) on monthly basis, I will transfer funds from cash damming LOC to this new operating account (there will be 3 mortgage payments, property taxes etc)
3) the principal repayment on my personal mortgage will also increase my HELOC limit (I am in the process of getting a readvanceable HELOC), and I will use this funds for investments (Smith Manuovre)
One more question:
Say, I transfer $4000 to the new operating account (I have 3 revenue properties) each month from my cash damming LOC, does it matter how I repay the cash damming LOC, and where the funds come from? (since I will be using the rents to pay down the mortgage on my principle residence)
Can I offset the LOC by transferring the minimum payment required (3% balance), and then transfer out the balance back to my personal account? I know most LOC allows you to take out the funds right after you deposit in. It’s almost like resetting the LOC repayment. So realistically, I will keep building up the LOC and accelerate principal repayment on my personal mortgage. I have about 30K limit.. so that will be good for a couple years.
And after my mortgage is paid out, I will start depositing rent cheques into the cash damming LOC (but you said that I shouldn’t deposit rent cheques into the cash damming LOC). And why is that?
And how should I repay the cash damming LOC? After all my personal debts are all paid out?
Your input is greatly appreciated!! Thanks!
My email is: vendbc@hotmail.com
Would love to continue our correspondence via email.. if that’s ok with you.
Jul 5th, 2010 @ 10:03 pm
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