How to Get Out of Debt Fast

Do you find yourself struggling to make those monthly bill payments because you have a lot of debt? Are you conscious of the fact that many of those monthly payments go only to interest while paying off very little of your actual outstanding balance? There are ways to get out of debt fast out there, but sometimes it is difficult to know which ones are best for you. 

Do you constantly hear those offers on the radio that talk about debt consolidation and find yourself thinking about them as an option for solving your debt problems?  These options are being provided by bankruptcy trustees or debt counsellors – but they are often not the best option, especially for homeowners. Firstly, these solutions come in the form of a consumer proposal or bankruptcy. Although they can help you get out of debt fast, these options can have devastating long term impacts on your credit, negatively impacting your ability to secure financial funding in the future. Your ability to purchase a new home, refinance your mortgage, or even buy a car can be severely reduced when you have a consumer proposal on your credit report.

So how do you get out of debt fast? If you are a homeowner, refinancing your mortgage is a much safer financial option for getting out of debt fast. By consolidating your debt through refinancing your mortgage, you eliminate the various minimum monthly payments – much of which are primarily interest - into one manageable payment.

Additionally, not only is this single monthly payment much smaller than what your various others combined were, having it combined into a refinanced mortgage ultimately saves you thousands of dollars in interest long term. It is also far likelier that you will be able to pay off the mortgage sooner than if you had kept all of the credit card balances going and paying only the minimum payments.

Banks vs. mortgage brokers – how do they fare when you are trying to get out of debt fast? Have you been to the bank and discussed your options regarding how to get out of debt fast, but failed to receive approval? This is often because banks stand to gain from your continuing to pay only the interest on your credit cards – think about who controls many of those cards in your wallet! The longer you pay only the interest instead of paying the cards off outright, the longer the bank makes money off of you. Also, banks tend to work with fewer lenders and follow stricter guidelines when it comes to who qualifies.

Mortgage brokers on the other hand work with a much more diversified portfolio of lenders and are able to cast a much wider net. This means that the options available to you for getting out of debt are much more numerous when working with a mortgage broker. Rather than focusing solely on your credit score, a mortgage broker can often secure you financing at a good rate when the bank has continually refused.

There are many options out there to help you get out of debt fast, but if you are a homeowner, refinancing your mortgage is usually the best choice! For more information on how to get out of debt fast, please contact Paul Mangion at The Mortgage Centre by calling 416 204 0156 or visit www.themortgagecentretoronto.com

Refinancing Your Mortgage in Ontario – Top 3 Mortgage Refinancing Tips from the Mortgage Centre Mississauga

Refinancing your mortgage in Ontario can be the perfect solution to various financial issues you may have, including getting rid of debt or paying for things such as home renovations or your child’s tuition. Mortgage refinancing can get you the capital you need to finance these things. 

Are you thinking about refinancing your mortgage but unsure about the path to take? Use these three important mortgage refinancing tips from The Mortgage Centre to help you decide which route best suits your current and future financial goals. 

Mortgage Refinancing Tip #1: Develop a strong relationship with your local mortgage broker. In the past, banks were the major financial institutions that most people went to for financial advice and assistance. However, today there are so many different options out there that it is crucial to explore. One of the greatest sources for financial security and freedom is a mortgage broker, and once you have found one it is a great idea to establish a good relationship with them. Their expertise can help in so many different areas, be it the acquisition of your first mortgage, paying off debt, or refinancing your mortgage. 

In the case of mortgage refinancing, it is often your mortgage broker – not the bank – that can and will secure you the best interest and mortgage rates, as well as finding alternative sources of funding if the bank chooses not to approve you.  It is beneficial to depend on a professional mortgage broker when your financial best interests are at stake.

Mortgage Refinancing Tip #2: Get a credit report check. Before applying for mortgage refinancing, it is a good idea to know where you stand as far as your credit. If your credit score is great, your mortgage broker will have no problem securing you great rates when refinancing your mortgage. When refinancing your mortgage in Ontario, a credit score of 680 is considered good.

If however, you have less than perfect credit, your mortgage broker will go through your various options and not only find you funding, but help you rebuild your credit. Being prepared by knowing your credit score will help you to understand that you may be paying a higher interest rate, and to know that you should ask for help with budgeting and debt payment strategies.

Mortgage Refinancing Tip #3: Using an online mortgage calculator, evaluate different amortization periods and assess how they impact mortgage payments.  Rather than going into the bank and taking the first offer you are given – which is usually based on an amortization period of 25 to 30 years - being prepared and knowing what different terms offer can save you thousands of dollars in interest. A shorter amortization period may carry slightly higher monthly payments, but in the end you are paying it off much quicker and saving your money.

Being prepared before refinancing your mortgage in Ontario can mean the difference between money in your pocket and money in the bank’s. You work hard for your money, so take the time and do your homework. Use these tips to guide your search for the best mortgage refinancing you can get.

For more information on mortgage refinancing in Ontario or to get more mortgage financing tips, please contact Paul Mangion at The Mortgage Centre by calling 416 204 0156 or visit www.themortgagecentretoronto.com

How to Stop Foreclosure Beginning with Dealing with Mortgage Arrears

Are you finding yourself struggling with your monthly bills? Are you worried that there is a chance that you may fall behind or default on your mortgage payments? Do not ignore these concerns. Dealing with mortgage arrears and learning how to stop foreclosure before it happens is very important. 

There are ways to stop foreclosure and deal with mortgage arrears before they happen. To avoid losing your home through foreclosure due to defaulted mortgage payments, it is crucial to devise a plan to get your finances back on track. There are several options available to you, but some are definitely better than others!

When you are threatened with the fact that you may be unable to pay your monthly bills and mortgage arrears and foreclosure are looming overhead, it is first essential to examine why? The high cost of living coupled with high credit card or personal debt can be detrimental. A great way to fix this is to decrease your debt. But how can this be achieved?

Currently there are countless companies out there offering ways for you to reduce the amount of debt you owe or reduce your monthly debt payments. However, these usually come in the form of debt consolidation loans and consumer proposal plans that, although disguised to help you, actually carry with them devastating impacts for your credit. Avoiding them at all costs is a really good idea.

Instead, working with your mortgage broker to stop foreclosure and avoid mortgage arrears is much more effective. By using the equity in your home and taking on a second mortgage, you can pay off your debt and avoid foreclosure by making your monthly payments more manageable. This option will help you keep your credit in check and ultimately saves you thousands in interest versus trying to continue the monthly payments that were bogging you down in the first place!

What if you have already gone into arrears on your mortgage? Your options may be greatly reduced. Often creditors are less willing to approve applications for funds if mortgage payments are in arrears. Since most lenders will only offer financing if your mortgage payments have been made in full, your only choices may rest with equity only financing. This means that lenders use the equity in your home – and this means that you will need to have a bit more equity established in order to qualify.

Working with your mortgage broker once your mortgage payments are in arrears is a must in order to stop foreclosure.  They will be able to help you develop strategies to firstly, pay off the existing payments owed, and secondly to build a financial budget to allow you to maintain your current bills. This will help you stop foreclosure and avoid going into arrears on your mortgage in the future.

If you find yourself facing mortgage arrears and the potential foreclosure of your home and want more information about how to stop it and bring your mortgage payments back in check, please contact Paul  Mangion at The Mortgage Centre by calling 416 204 0156 or visit www.themortgagecentretoronto.com

Property Tax in Canada and What to Do If You Have a Property Tax Lien on Your Home

Have you found yourself in the uncomfortable position of having a property tax lien placed on your home because you have been unable to pay your property tax? Are you asking yourself what to do if you have a property tax lien on your home? This can be an inconvenient occurrence, but it is not the end of the world.

Property tax in Canada is a mandatory requirement, and there are consequences to be faced if you default on your taxes. One of these consequences is a property lien on your home.

So what is a lien? A lien is a claim on an item of your property (in this case, your house) that assures the settlement of a debt. What is a property tax lien? A property tax lien is a claim on your home that ensures payment of the debts owed to the Canada Revenue Agency (CRA) for unpaid property taxes.

What does this mean? It usually means that the balance owed becomes a forced payment that comes before any other – even your mortgage. This can be detrimental as it can impact your ability to pay other bills, thus damaging your credit score. Additionally, a property usually cannot be sold, and banks typically refuse to refinance a property, if there is a lien on it, therefore impacting your ability to sell your home or refinance your mortgage.

So what do you do if you have a property tax lien on your home? The best way to solve the problem of having a property tax lien on your home is to pay off the outstanding debt. This may seem difficult, but there are options.

The best option is to refinance your first mortgage or take out a second mortgage through your local mortgage broker. This will allow you to use the equity in your home to pay off the property tax lien, in turn saving you the interest you would have been forced to pay had you just continued to pay the monthly lien payments. A longer amortization period often means that your monthly payment increase is minimal and therefore your ability to pay is increased.

Sometimes your mortgage broker will voluntarily pay the off the lien, meaning you are then required to pay them back. This may seem like a great option, however, this could result in your house being put up for power of sale if you default on your payments to the mortgage broker. This option is probably best avoided.

Another seemingly viable option is to apply for a credit line or loan to eliminate the debt and get rid of the property lien. Again, this may just cause more problems as it is just another monthly payment for you to struggle with.

Want to avoid going into arrears on your property taxes in the future? A good way to do this is to get your mortgage broker to roll your property taxes in with your mortgage. Having one monthly payment may be much more manageable, and your property taxes will not default – thereby avoiding a property tax lien.

For more information about property tax liens and what to do if you have a property tax lien on your home, please contact Paul Mangion at The Mortgage Centre by calling 416 204 1256 or visit www.themortgagecentretoronto.com

Should I Refinance? Blog Series Part 4 – How to Get a Mortgage with Bad Credit

Are you a homeowner that is asking yourself “should I refinance” but know that your credit is in bad shape? Know that there are funds that you need but afraid your credit will prohibit you from accessing them? Don’t worry. There are many lenders out there that are willing to work with you even though your credit may not be perfect, and show you how to get a mortgage with bad credit.  

Credit can be bad for any number of reasons. Things like job loss or divorce can leave you in a financial position that has you struggling to pay your monthly bills. Some things are unavoidable, but this doesn’t mean you don’t deserve to have a roof over your head and the financial ability to survive. Thankfully, many lenders recognize and appreciate this and can help you get a mortgage with bad credit! 

Has poor credit forced you to claim bankruptcy or obtain a consumer proposal in the past? Chances are, you are trying your best to rebuild that less than perfect credit. This is all taken into account when you approach a mortgage broker. Your changing payment history will reflect these efforts, so know that lenders can see it.

Don’t know if you have bad credit? One major thing to think about that impacts your credit is your payment history. Have you habitually made late payments, or failed to make payments on a regular basis? Are you continually at the max on numerous credit cards, or are you going over your credit card limit? If you answered yes to these, chances are your credit is in less than perfect shape.

If you think you might have bad credit, or know that you do, again, don’t worry. Banks are no longer the only institutions– or even the institutions with a strong monopoly- in the area of mortgage refinancing. There are many different lenders that are willing to help you and approve your application for refinancing, and your mortgage broker can help you find them and access these funds.

Although the interest rate on refinanced mortgages obtained with bad credit is higher, it can be a good motivator to get the mortgage paid off faster. Knowing that you will end up paying more interest the longer it takes to pay off the mortgage, getting a mortgage with bad credit might be incentive enough to make you pay off the mortgage faster!

Also important when considering applying for a mortgage with bad credit is that your mortgage broker can work with you by going through your finances and can help you work on a plan to rebuild your credit. Setting up a budget and looking at different strategies and approaches to paying off debt and helping you in achieving and maintaining a high credit score is  something that a professional mortgage broker is trained to do.

Refinancing your home to cover various different costs in an important decision, but as a homeowner you should be able to access the value in your home.

For more information about what your answer to the question “should I refinance” might be, and how to get a mortgage with bad credit, please contact Paul Mangion at 416-204-0156 or visit www.themortgagecentretoronto.com

Should I Refinance? Blog Series Part 3 – Refinancing Your Mortgage to Consolidate Debt

Are you a homeowner with substantial debts? Have you asked yourself “should I refinance” and use that money to pay off my debt? Refinancing your mortgage to consolidate debt might be a good solution and could save you a lot of money.  

Paying credit card debt by refinancing your mortgage means that you are accessing the equity in your home – using the value of your home – to borrow against. This can mean that a substantial amount of money is available for you to use to pay off your debt. So what are the benefits of doing this? 

Firstly, say for example you owe 40 000 in credit card debt. All cards have minimum monthly payments that you are required to make – but these do not in their entirety go onto your outstanding balance. Monthly payments are usually made up of interest and payment on the balance, however, the majority of this goes to interest, meaning that you are actually only putting a tiny amount onto the outstanding debt. That 40 000 dollars can take way too long to pay off!! Since credit card interest is often very high, refinancing your mortgage to consolidate debt allows you to save a lot of that interest.

Secondly, refinancing your mortgage to consolidate debt allows you to lower you monthly payments considerably in order to avoid the accumulation of more debt. If you are struggling to make the minimum payments, chances are your debt isn’t actually decreasing at all, and you may just be increasing it through continued use. By consolidating your debt you are able to reduce your monthly debt payment and take control of your financial situation. Furthermore, since your required monthly payment is lower, you will have extra monthly cash flow and when able, can just pay more directly to the balance owed.

Another good reason to refinance your mortgage to consolidate your debt is to improve your credit. Even if you make the minimum required payment on each of your credit cards, having several cards with high balances can negatively impact your credit rating. High balances make it seem as though you are unable to manage your finances in relation to your monthly income, and therefore you may seem like a high risk investment. By refinancing your mortgage and using the value of your home to pay off debt, you can fix this problem.

Banks versus a mortgage broker – which option is best? Since this is a financial issue, your first thought might be to go to the bank and try to get a consolidation loan. However, as a homeowner, there are far better options available to you. Since banks are often the financial institutions that control your credit cards, it is in their best interest to keep you paying the minimum monthly payment (much of which is just interest). It means way more money for them if you just continue to pay interest. Banks are also often much stricter when determining who qualifies for a loan, and so going to a mortgage broker means a better chance of getting the money you need to get those debts under control.

There are many things to consider when asking yourself “should I refinance.” Refinancing your mortgage to consolidate debt can be an important solution to getting control of your debt and saving money.

 For more information about what your answer to the question “should I refinance” might be, and how refinancing to consolidate debt can work for you, please contact Paul Mangion at 416-204-0156 or visit www.themortgagecentretoronto.com

Should I Refinance? Blog Series Part 2 - What is a Second Mortgage or a Second Mortgage Loan?

Are you thinking of paying off some of your debt, or need some money for major renovations or other financial needs? Are you asking yourself “should I refinance?” Well a second mortgage might be the best option for you.

Firstly, what is a second mortgage? A second mortgage, also known as a second mortgage loan, is a home equity loan that lets you borrow from your home’s equity while avoiding refinancing your first mortgage. This is important because a second mortgage lets you continue payments on your existing mortgage uninterrupted, allowing you to pay off your debt quicker, ultimately saving you interest.

Because a second mortgage is based on your home equity, the amount is based on the difference between the appraised value of your home and the amount still owing on your first mortgage. This can be a significant amount of money, and refinancing by taking out a second mortgage can be a good option for getting some much needed capital.

So what are the benefits of a second mortgage? Often, second mortgages can be important sources of income, and a lot of income. Because it is based on the value of your home, it is easy to access thousands of dollars.  An easy way to estimate the amount you might qualify for is to have an appraisal done on your home – which will be necessary once you apply.

What can they be used for? Really anything. Paying off debt is one of the most common usages of a second mortgage loan. Because the interest rate on a second mortgage loan is often far lower than a credit card, paying one off with the other can ultimately save you thousands of dollars in interest. 

Using a second mortgage to pay for a child’s tuition is also common. Chances are you have built up substantial equity in your home by the time your child goes off to college or university, and so a second mortgage can prove to be a sure-fire way to secure funding for this. For the same reason, obtaining a second mortgage loan to pay for home improvements or to open a small business is an important consideration when asking “should I refinance.”

Why not just refinance by adjusting your first mortgage? This can be an option, but often the interruption can mean a longer amortization period resulting in more interest being paid by you in the long run.  This is where a mortgage broker comes in. Let them go through all of the options available to secure the best mortgage product to suit your current financial needs and goals.

As a homeowner, you have worked hard to make a dent in your existing mortgage and have thus created equity. This home equity can be an important source of income when it comes to a second mortgage loan. 

For more information about what your answer to the question “should I refinance” might be, and what a second mortgage is, please contact Paul Mangion at 416-204-0156 or visit www.themortgagecentretoronto.com