by admin | Consumer Proposal, Credit Counseling, Credit Repair, Debt Management
Are you thinking about buying a home? If yes then be prepared to get advice from individuals who last bought a home in the 1980s. Considering what’s just been said, it’s important for you to know that the mortgage landscape has transformed greatly in the past several years. Also, when mortgaging a home, do not believe everything you hear. Instead, do your own research or talk to a credit counselor.
If the mortgage process scares you to death then you need to know that you’re not alone! All aspiring homebuyers go through the same feelings. However, only those who are well informed about the mortgage-buying process prevent their fears from being realized. Want to be one of them? If yes then do your research or talk to a credit counselor to be aware of the mortgage myths making the rounds today. To get you started, following are three most common mortgage myths credit counselors want you to ignore.
A 20 percent down payment is necessary
This is probably the biggest mortgage myth making the rounds today. Therefore, you need to know this—you don’t necessarily need to make a 20 percent down payment. Instead, there are ways for you to secure mortgage financing with minimal down payment provided you qualify as a borrower.
Also, some people will tell you that paying less than twenty percent down payment can be damaging in the long-term. While there are some disadvantages of making less than twenty percent down payment, it is by no means a damaging act.
Pre-qualification guarantees the loan amount
If you’re looking to buy a home and want to get a general idea of your budget then getting pre-qualified is necessary. However, it’s important for you to keep in mind that pre-qualification doesn’t mean that you’re guaranteed the loan amount. In order to find out how much you can logically expect to be approved for, your lender considers your credit report and assets during pre-qualification.
However, the lender doesn’t explore your finances during this stage and therefore isn’t making any commitments to you. Instead, you’re guaranteed the loan amount once you’re pre-approved simply because pre-approval is a much more comprehensive process. Before approving you for a loan amount, the lender will find out everything they want to know about you.
Renting is a more cost effective option
Another common myth is that renting a home is cheaper than buying one. However, the truth of the matter is that, compared to renting a home, mortgaging a home is always cheaper. How? When you rent a house, maintaining the house is the responsibility of the landlord. However, what most people do not know is that the ‘cost’ of maintenance is included in the rent you pay. When you volunteer to maintain the house, the landlord charges you a lower rent. Either way, you’re paying to maintain a house which eventually, at some point of time, you’ll have to vacate. With a mortgaged home, that is not the case. Also, when you rent a home, you’re doing nothing but throwing away your hard-earned money every month. On the other hand, when you mortgage a house, you give yourself the opportunity to build equity.
In addition to the aforementioned myths, there are many others myths related to mortgage. However, the myths mentioned above are the most common myths about mortgage and ones credit counselors want you to ignore.
by admin | Bankruptcy, Consumer Proposal, Credit Counseling, Credit Repair, Debt Management
Do you own a car? If not then you need to get one right away. Start taking control of your future: public transport can be unreliable at the best of times, and there is never a good time to start saving so just do it. Get those lessons booked, pass your test, and buy a car using our car finance service to take control of your future. Whether you’re looking for car financing with bad credit or car financing with good credit, you need to act now. By acting now, you will have little to regret in the future.
In car financing, credit score plays an important. Generally, if you have a bad credit rating, you’ll have to pay a higher interest rate. On the other hand, people with god credit rating need to pay a low interest rate to secure car financing. Nonetheless, as car financing for bad credit is available, a person with a bad credit can secure the car of his or her dreams. What is bad credit? Generally, bad credit refers to a poor credit rating. There are many reasons for a poor credit rating including not enough credit history years, identity theft, and a history of late payments to lenders. The type of interest you’ll up paying for your financed car is determined by your credit rating.
When it comes to car financing, the most significant thing is credit score. Your credit score determines whether you quality for a regular loan or need car financing for bad credit. Several things are a part of the credit score including mortgages, auto loans, student loans, and credit card payments. However, credit score is largely determined by your payment history and the amount owned. You credit score may affect your car financing. Generally, a credit score of more than 700 will ensure that you pay a low interest rate for the car you wish to buy. On the other hand, a credit score of less than 550 may make you eligible for car financing for bad credit.
Generally, a higher interest rate is what a poor credit rating leads to. However, that isn’t always the case: reasonable car finance for bad credit is also available. This means that to secure car financing, a person with a poor credit rating or bad credit doesn’t necessarily need to pay a higher interest rate. There are a few car financiers that allow people with bad credit to finance a car at a low interest rate. You can find out more about this by getting in touch with a certified credit counselor. The advice you get from the counselor will help you to secure car financing easily and at a low interest rate.
by admin | Credit Counseling, Credit Repair, Debt Management
When should you refinance your home? The rule of the thumb is that you should get refinancing only if your new interest rate is two percent less than your current one. However, deciding whether to go for refinance or not isn’t as simple as that. You need to look at several other things. This includes your financial situation and what you want to get out of refinance. Here, we’re going to discuss the things that make refinance mortgage a sensible decision but before we do that, let’s take a look at the how refinance mortgage works.
How refinance mortgage works
To make a viable decision, knowing how refinance mortgage works is important. Paying off the mortgage you originally got and replacing it with a new one is what refinance loan refers to. The refinance loan may have new interest rate and terms. However, the property remains the same. Obtaining refinance loan is easier than obtaining a regular mortgage because you already own the property. Additionally, refinancing will become easier if you owned the property for a considerable period of time and have significant equity in it. Now that you know how refinancing works, let’s take a look at when you should get a refinance loan.
When should you refinance your home?
Many people find it difficult to determine when they should get refinancing. If you’re such person then you don’t need to sweat because we have all the answers for you. First and foremost, before getting refinancing, you need to consider whether such a move helps you to lower your interest rate and monthly mortgage payments. In case it doesn’t, getting home refinance may not be the best option. On the other hand, if home refinance involves reduced interest rates, you could potentially build up equity in the home faster by getting a shorter-term mortgage loan.
Lowering the interest rate is one of the most common reasons to get home refinance. You should consider such home financing if you’re able to get 2% to 3% lower interest rate than what you’re currently paying. However, you need to keep in mind that this sort of home financing involves paying closing costs and possible extension of loan terms.
Compared to what you’re currently paying each month, you could potentially be paying more with refinancing so doing the math beforehand is important. However, by extending your loan terms, you can use this form of home financing to lower your monthly mortgage. This makes home refinance an affordable option. On the other hand, you can build equity faster by shortening your loan terms. By choosing this option, you can pay off your mortgage sooner and with less interest. Finally, you can use this form of home financing to change your loan type. This means that you can change your loan type from adjustable-rate mortgages (ARMs) to fixed rate mortgages (FRMs) and vice versa.
There you have it—how and when to refinance. Using the aforementioned information, you can determine whether home refinancing is a viable option for you.
by admin | Bankruptcy, Consumer Proposal, Credit Counseling, Credit Repair, Debt Management
Want to meet your financial needs while keeping your debt to a minimum? If yes then short-term loans are a good way to achieve your objective. Short-term loans are something even credit counselors recommend. Why? Let’s take a look.
People utilize the aforementioned loans for a variety of reasons. The most obvious reason for anyone to obtain a short-term loan is minimizing the time they live under debt. Apart from forcing you to live under debt for most of your life, conventional or long-term loans make you pay back an amount which is significantly higher than the original loan amount. This is due to the interest involved in the loan: the longer you owe money to the lender, the more interest is added to your balance which of course means paying back a higher amount.
The best way to counter the aforementioned problem is a short-term loan. By allowing you to pay back everything quicker, a short-term loan minimizes the total time and amount of your debt including less accrued interest. You can save money in the long term even if the interest rate of the short-term loan is considerably higher than what you’d get with a conventional or long-term loan. There are a number of reasons to opt for a short-term loan. Following are some of those reasons.
Get money fast
Quick access to the money you need is what a short-term loan provides you. This is probably the biggest benefit of this type of loan. If you are in dire need of money and want to avoid a lengthy loan approval process then opting for a short-term loan is the best thing for you to do. By providing the money you need within a shorter time span than conventional or long-term loans, short-term loans allow you to get money fast. In fact, with some short-term loans, you can get access to cash within a few hours or the same day.
No collateral
Collateral is required to secure a long-term loan. Usually, borrowers use their home as collateral to secure the loan. Unlike long-term loans, short-term loans do not require borrowers to provide collateral against the loan. Though they are legally binding and must be repaid, the aforementioned loans do not cause a loss of a home or other asset used as collateral when there is a default in their repayment. In short, short-term loans allow you to get the money you need without risking any of your belongings.
Ability to borrow with a poor credit score
The majority of the conventional or long-term loans won’t be available to you if you have a poor credit score. Even if you qualify for conventional or long-term loan with a poor credit score, the terms of the loan are likely to dissuade you. Fortunately, this doesn’t happen with a short-term loan. Even if you have a poor credit score, you can secure a short-term loan easily without any dissuading terms.
Avoid long-term stress
When choosing a long-term loan, many people tend to ignore the long-term effects of the loan. Long-term loans force to you to commit to something for a long period of time. Usually, longer duration loans intimidate borrowers and cause stress in them. Your financial standing in the distant future is something no one can accurately estimate. Also, saying for certain what the economy will look like ten or twenty years from now is not possible. Regardless of what your financial situation is and what the economy looks like, you’ll still be responsible for payments ten or twenty years from now if you obtain a long-term loan. A short-term loan is the best way to obtain the money you need if you want to avoid long-term problems and stress.
Depending on where you obtain it from, a short-term loan may or may not result in all of the aforementioned benefits. If you want to know more about short-term loans, contact a credit counselor today at gtacredit.com
by admin | Bankruptcy, Consumer Proposal, Credit Counseling, Credit Repair, Debt Management
Many people find repairing credit difficult. If you’re one of them then you need to know this: By using the appropriate strategy, you can improve your credit over time but before you start repairing your credit, you must find out how credit repair can benefit you. First and foremost, repairing your credit is absolutely essential if you want to improve your credit situation and avoid drowning in a sea of debt. Secondly, if you go bankrupt, credit repair can shorten the time your credit suffers for, allowing you to quickly rebuild financial stability.
Now, you can either repair/counselling your credit yourself or hire a credit repair/counselling service for that purpose. Regardless of how you perform it, credit repair can benefit you in the long term. Although it costs money upfront, credit repair would save you a lot of money in the long run with less interest rates and so on. So why should you pursue credit repair? Following are three reasons to go for credit repair/counselling.
Eliminate inaccuracies
Eliminating the inaccuracies in credit scores is the main purpose of credit repair/counselling. Credit repair seeks to ensure that your credit score is based on accurate and fair information. Recently revealed stats show that the credit reports of over 70% Americans have some sort of miscalculations or inaccuracy. The miscalculations or inaccuracies are a major reason for poor credit scores. For the reasons just mentioned, credit repair is a good way to get your finances back on track. To eliminate the inaccuracies or miscalculations in the credit report, credit repair identifies mistakes and corrects the ‘inaccurate’ information. This results in an improved credit score.
Lower the costs of insurance
Not many people know this but credit score can have a huge impact on the costs of insurance. Ignoring the impact of your credit on the cost of insurance is something you mustn’t do because if you do that, you’ll end up incurring massive insurance costs. Today, insurance companies determine the premium to charge for coverage by looking at the applicant’s credit reports. In case the applicant has a poor credit rating, he or she may be charged significant premium or worse: denied insurance. By improving your credit rating, credit repair helps you to lower your insurance costs.
Eliminate non-existing debts
Many times, credit reports show non-existing debts i.e. debts that no longer exist. This causes the credit score to suffer unnecessarily. Your overall credit score depends a lot on your income-to-debt ratio. As credit repair eliminates the non-existing debts, you can use it to improve your overall credit score.
As seen above, there are many reasons to go for credit repair. The most obvious reason to perform credit repair is improving credit score. Whether you do it yourself or get help from a credit repair/counselling service, credit repair/counselling is a good way to improve your credit and rebuild financial stability.
by admin | Bankruptcy, Consumer Proposal, Credit Counseling, Credit Repair, Debt Management
Student debt financial concept as a graduation mortar board on the word for school tuition loan repayment or lending and education financing symbol for university and college students on a white background.
Regardless of the level of credential they earned or type of institution they attended, an overpowering impact is what student loan debt is having on the spending habits and the everyday lives of young people in the United States and Canada. Provided you finance it with your own money, college education is the gateway to a bright career and a handsome salary for the rest of your life. However, if you borrow money for your college education, you may not get to experience the latter.
According to LIMRA, an association of financial services and insurance companies, by the time you retire, student loan can cut more than $300,000 from your retirement savings. In the past two decades, student loan debt has increased significantly. Twenty years ago, the average student loan debt was a little under $13,000. Today, it stands at over $30,000. To find out how student loan debt affects the lives of students, a survey was carried out recently. The purpose of the survey was finding out the personal, emotional, and financial stress caused to graduates by the debt. The survey included over thousand graduates. The results of the survey showed that student loan causes stress and prevents graduates from pursuing their dreams.
The majority of the surveyed graduates said that the debt affected their ability to save for retirement. Other things affected by student loan debt included:
- Taking a vacation
- Mortgaging a home
- Dining out even on a fortnightly basis
- Buying a car
- Getting married
- Starting a family
- Paying daily expenses
- Starting a business
In addition to the aforementioned things, student loan debt was a source of embarrassment for more than 50% of the surveyed graduates. Moreover, the debt impacted the job choices of more than 40% of the graduates. Finally, over 30% of the surveyed individuals said that student loan debt had affected their ability to be social.
For many college graduates, debt is a source of pain. Today, an increasing number of graduates are finding it difficult to pay their loan on time. Over the past decade, negligence on student loans has increased dramatically. In 2005, of all the people in the U.S who had taken student loan, only 7% showed negligence on the loan. In 2015, almost 15% of the graduates with student loan were a minimum of 90 days late on payments.
While student debt can affect you in the aforementioned ways, it is far from being bad. Paying your debt on time will help you to build your credit. Your credit scores will get better as you pay down the debt. To find out how student loan is affecting your credit, request the relevant bureau for a copy of your annual credit reports. Also, you can search your credit scores online to find out how you’re doing in categories such as payment history. In case you’re behind payments, there are many ways for you to get back on track. In short, student loan debt can affect your life but only if you allow that to happen.
