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Four Smart Tips to Get Approved for Personal Loans

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When applying for a personal loan, facing rejection is the last thing you would want. But, because these loans are unsecured and have higher risk factors involved, the lenders are not very open to offer them as a part of their mortgage programs. So, getting approval for such loans is kind of difficult.

Personal loans are usually availed for reasons such as remodeling the house, planning an international trip, managing the debt consolidation, funding the medical expenses, making arrangements for the wedding and similar others.

These loans are not backed by any collateral asset. And, thus, the lender cannot auction anything you own in case of any default. However, he is going to charge you the rate of interest that is higher in comparison to other loans for the safety sake.

Now, because personal loans are extremely useful in almost every aspect, they are worth considering when making a purchase or investment. If you wish to boost the chances of getting approved for this loan, keep in mind the following tips –

  1. Calculate your Credit Score

A good FICO score is an indication of your ability to repay the loan. It is a method of quantifying and evaluating your creditworthiness based on your payment history, amounts owed, length of credit history, new credit and credit mix. The higher this score, the more are your chances of getting approved for a personal loan. So, if you have a lower score, it is recommended to wait and improve it by paying off your pending bills and debts.

  • Avoid Filling Multiple Loan Applications

This is one of the major mistakes loan buyers make when looking for a personal loan. They send loan application forms to multiple lenders or financial institutions thinking to receive a response from at least one of them. However, such a move makes you seem desperate and gives a bad impression of your financial status. Moreover, you end up affecting your credit scores if you don’t get approval from them.

  • Search for a Reliable Lender or Broker

You have to do ample homework to search for a good lender or mortgage broker. In case you are struggling with poor credit scores, you have to look for someone who specializes in high-risk borrowing. Stay away from payday and title loans because they can keep you in permanent debt, with their unrealistic fees. In fact, avoid every offer that seems too good to be true and instead derive an in-depth comparison to get the best deal and low-interest rates.

  • Keep an Eye on your Debt-to-Income Ratio

At any given point of your life, spending more than forty percent of your income towards monthly loan repayments can be highly detrimental for your overall finances. Hence, if you earn $2500 a month, you shouldn’t be paying out more than $625 for your EMIs. By no means, your monthly debt should take a toll on your monthly gross income. Try to keep the debt-to-income ratio as low as possible and don’t borrow unless very necessary.

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Things You Need to Ask Your Mortgage Broker

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Are you planning to buy a mortgage, but don’t have enough knowledge about it? Are you first-time mortgage buyer? Do you want to renew your mortgage? Do you want to hire a mortgage advisor but don’t know how to spot the best professional? If your answer to any of these questions is yes, then this article is for you.

Hiring a mortgage advisor can be an overwhelming task, especially if it is your first time. When you are in the market, there is much more to consider than the interest rate. But, if you successfully hire the right mortgage broker, you can rely on him for all the mortgage-related tasks. He will leave you stress-free by doing all the formalities and paper-work on your behalf.

However, all the brokers are not the same. Some take their profession seriously and help their clients in cracking the best deal. While others work for the sake of commission. To make sure that you work with a reliable mortgage pro only, don’t forget to ask him the following questions.

Question #1. Can you provide references?

Firstly, ideal is to take recommendations from friends, relatives or neighbors. But, if you have selected mortgage specialist through a listing available on the internet, then ask for references. A true broker who is true to his profession will happily provide you with the reference list, whereas, an unethical and unprofessional person will only make excuses. Don’t work with the later ones.

Talking to the previous clients, you can learn about their experience with the broker during the entire process. Ask if they were treated fairly or not. Also, ask will they work with the broker in the future if required.

 Question #2. From how many years you are working as a mortgage broker? 

Now, this is among the most important questions as it will help you in learning about the experience of the loan advisor. More the number of years into the brokerage more will be the experience. Hence, the best advice you will get.

If you think that going for the amateur broker will cost you less, then it is your biggest myth that you should debunk right now. Only an experienced broker has good links in the market and can help you in getting the loan at the lowest rate possible.

Question #3. What type of loan will work best for me?

Several types of mortgage options are available in the mortgage industry. But you need to find the one that works best for you. A trustworthy and reputed mortgage broker will patiently explain all the loan types to you and will also suggest the best loan option. He will analyze your needs and financial situation thoroughly before reaching any final decision.

Moreover, this question will help you in knowing how much knowledge do mortgage broker has about the loan and its types. So, don’t miss asking this crucial question if you want to know your mortgage broker in a better way.

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Different Ways To Shop For A Home Loan

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It is always wise to have a plan set in place before making a huge lifetime investment. This principle also applies when planning to buy a home through a mortgage. You need to make an extensive research and check out different lenders to get low mortgage rates in Quebec. If you are thinking of buying a home for the first time, here are some of the strategies you can use to qualify for the lowest mortgage rates available in the market.

Form a baseline

Talk to friends or colleagues who have undergone the process of acquiring a home loan to recommend a good lender with a flawless reputation. Make a point to meet with the lender to discuss your credit score and get to know your home loan options. Get all the details you need on repayment plans to ensure you make an informed choice before settling on a particular lender.

Work on your credit score before applying for a home loan

How is your current credit score? Do you have a good or bad credit score? If you are not sure where you stand, check your financial statements to see how your credit score is rated. If you have a good credit score, you stand a better chance of getting low-interest rates on your home loan. If your credit score is far from good, you don’t need to worry if you qualify for a home loan. Most lenders are willing to work with you to come up with ways you can repay your home loan without struggling much. You can increase your credit score by ensuring you pay off your monthly credit card bills and other loans on time.

Decide on your loan term

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Don’t shy away from discussing your loan term with your lender. Be honest about your current financial situation so that they can work out the best loan term for you. You need to keep in mind that a longer loan term will attract high-interest rates compared to a shorter loan term. How long you plan to keep your house can also influence the type of home loan you apply for. For example, you can apply for 5/1 hybrid mortgage if you plan to own a house for less than five years. This allows you to pay low-interest rates on your mortgage for the first five years. You can then look for a buyer for your house after the five years and sell off your home.

Check for any hidden charges

Before signing any papers on a home loan contract, check for any hidden charges. This helps you to calculate how much you need to pay on a monthly basis. If you find some terms in the contract are too hard for you to understand, ask the lender to explain them or better yet get a lawyer to simplify them for you. See if you agree with the terms and conditions on a contract before you sign. You should take your time to make a decision and never allow a lender to push you to make the decision if you don’t feel ready to make a commitment.

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Why It Is Important To Shop Around Even When Looking For Help In Clearing Debts?

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There are times that we are unable to meet our financial targets and this can cause more problems by not being able to pay debts on time. During this time, one is desperate to seek solutions to debt crisis by seeking debt consolidation. One is usually very vulnerable at this stage and they can easily fall prey to scammers who seek to take advantage of your situation. Consumer credit counseling can help you clear your debts by offering possible solution tactics you can follow. However, you need to ensure that you sign up with the right agency so that you don’t get to become a victim to scammers. These are signs you need to be on the lookout for before signing up with an agency.

The range of financial services offered

Check to see what kind of financial services are offered by the agency. Usually, an agency will offer more than one financial service. They can offer budget counseling for those heading towards debt problems and housing counseling for people facing foreclosure on their homes. These are just a few. These counseling sessions can be one on one or over the phone or even over the internet depending on what works for you. A small maintenance fee is required and you should have your payment records well kept on your side. This applies even to the nonprofit agencies.

Don’t be pressured into signing debt management plans

Be wary of agencies that pressure you to sign up for any sort of debt management plan. It usually takes a credit counselor one hour to evaluate your income, expenses and debt before they can come up with a solution. If a credit counselor is rushing through this process, then they may not be legit. You should never be asked to pay any fee upfront before getting some counseling evaluation on your issue. Note that no agency has the power to erase information on a credit report and the only way to do so is by planning to make payments over time. A good agency will help you plan how to achieve that.

Ability to help resolve debt problems

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A genuine debt consolidation agency will have a good reputation of helping its clients get out of debt successfully. You can research first on an agency before signing up by asking for references from family and friends. You can also check the reviews on their website from people who have been there before. To check if the agency has a good standing, check with the Better Business Bureau to check out of any complaints made against them. In this case, it is best to be realistic that there will be always someone who has something to complain about. What is important is to check how the case was handled and how the customer service was.

Is it a non-profit?

Just because a debt consolidation agency advertises that they are a non-profit does not mean that they are legit. You can check an agency out from a third party accredited organization to inquire about the legitimacy of this agency.

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Helpful Ideas In Acquiring Low Mortgage Rates

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Buying a home and securing a mortgage is a major financial commitment. This is why you need to make an informed choice before settling on a mortgage rate from a certain company. For a first time home owner, this process may seem overwhelming but with the right research, you will be well equipped with the information you need to help you make a decision. We are going to look at some ideas that will help you get low mortgage rates.

Mortgage type

Mortgage type

There are two types of mortgages available in the market. Fixed rate mortgages and adjustable rate mortgages are given depending on the requirements of the client; however, many home-owners go for the fixed one. As a soon-to-be homeowner though, you need to understand what each type offers.

A fixed rate mortgage is one that offers a fixed rate of interest that you will be paying throughout your repayment period. The benefit of this type of mortgage is that you can easily plan on how you will pay at the end each month. The rates are not affected by the economic status. However on the downside, if there are favourable economic conditions, you will not get any financial relief. Knowing this you will decide which type of will work the best for you.

Deposit amount

Every approved loan needs an initial down payment. Mortgage brokers advise their clients to save first before buying a new home. You need to understand that when you make a huge deposit on your down payment you get low interest rates but if you pay less you get high interest rates.

Additional costs

Usually, at the final process of paying off a mortgage, there are costs that one needs to pay off. They roughly add up to around 3% of the actual property value. The lenders charge this amount to constitute costs to cover things such as the processing fee, underwriting title insurance costs and appraisal costs. As you look around check on mortgage lenders that offer the best deal on closing costs.

Loan estimates

Compare mortgage deals from various lenders before making a decision. However one is advised to seek the services of a mortgage broker since they will save you the time that you will use going round checking on mortgage terms. They are well experienced and since they liaise between you and the lending institutions .They already have the information that you need. They advise you on where best to invest in.

Credit score

There are implications that come with getting into signing off on a mortgage if one is not fully ready to make the investments. Checking your credit score ensures that you get your financial position and if you have a low credit score, it advisable to first work on improving the score before applying for a mortgage. However even with a bad credit score you can still apply for a mortgage and your mortgage broker can help you with this. If you decide to take on the mortgage you can later decide to refinance your home and increase your credit limit which allows you to pay in smaller instalments.

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How To Save For A Mortgage Down Payment

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Gone are the days when you have to allocate a very huge amount of cash in order to purchase the property you have always wanted. Now, in the Canadian mortgage scene, you can potentially buy the property within a certain percentage of down payment, which is often five percent. When this is the case, however, you will be required to have mortgage default insurance which then brings you back to just settling for more than the 20% down payment for the property.

This is called the conventional mortgage or one where you are expected to pay at least 20% of the property’s value as down payment with the remaining 80% or less financed through a lender. This will then be the Loan to Value ratio of your property. Always remember that the higher the contribution you make, the lesser the mortgage loan amount you will pay over time. Whichever the case, whether you choose a 5% or more than 20% down payment, you might as well consider learning how to save for that amount.

Save your funds in an account

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Saving for the down payment is perhaps the most practical way with which you can get that dream home of yours. It will take time to save this amount if you do not learn how to choose the right account with which you should save those funds. It is recommended that you have an account that guarantees you will gain interest on your savings. Mutual funds, term investments or a Canadian Tax-Free Savings account can be a good start. You may also want to invest with a Registered Retirement Savings Plan (RRSP).

If you are lucky enough, you can also use the cash gifts given by your friends and loved ones. You can save the same in any of the funds mentioned above so that when the time comes and you are ready to make an investment, there is something you can use to finance your down payment.

Secure mortgage default insurance

If in case you have not saved the 20% down payment but you have at least 5% savings to finance the down payment for your dream home then you are good to go provided you have secured mortgage default insurance. You can look for the best suppliers of such insurance in Canada. This insurance is a licence for you to obtain the nod of the lender since there is something he can ran after in case you default on your payment. Do not mistake this with the regular homeowner insurance that protect homeowners from property damages.

Pay the insurance accordingly

You have choices when it comes to paying the mortgage default insurance. First, you can pay it on a lump sum basis right at that instant when you have closed the mortgage deal with the lender. If you do not have enough money to pay it lump sum, however, you can go for option number 2, that is, to pay the insurance over time in addition to your monthly mortgage amortisation.

It will be wise to compare mortgage rates to save you more in terms of your total investment later on. Feel free to compare rates via this website!

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How To Make A Bad Credit Mortgage Work In Tough Financial Times

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One of the most common challenges people with bad credits face is getting a good mortgage. Luckily, there are bad credit mortgages that cater specifically to such individuals. People make financial mistakes sometimes. However, it does not mark the end of your dream to own a house. There are useful ideas that make things work even with bad credit. Hard financial times and mistakes put you on the right footing when you learn from them. To make a bad credit mortgage work for you, you need to consider the following ideas.

Type of lenders

Lenders

Many lenders will probably turn you down when you approach them for a loan with a bad credit score. By searching around carefully, you can still find lenders who can assist you in your current financial situation. It is possible to get a mortgage with a bad credit. Bad credit mortgage lenders make it possible. However, you need to be careful when selecting a lender. There are lenders who may take advantage of your situation. Ensure you find reputable bad credit mortgage lenders before taking further action.

Work on short-term basis

For a fact, it is costly to get a mortgage with a bad credit. If you decide to get the mortgage loan, you need to consider making it a short-term commitment. It pays in the long run when you choose to make short-term commitment. Managing the mortgage payments over a short-term period makes it possible for you to be eligible for conventional loan programs that have low interest rates. Note that this does not imply getting a short-term loan as an alternative. It simply means ensuring you pay the mortgage on time. This is inclusive of all your debts and bills. Over time, your credit score will improve and earn you a chance for better conventional loans.

Adjustable-rate mortgage

The interest rate for a fixed-rate mortgage may be too high for you during tough financial times. Therefore, you can consider an adjustable-rate mortgage as it guarantees you the possibilities of getting low rates. It helps keep the mortgage payment low and realistically manageable in your current financial situation. Consult mortgage experts for more clarity on how to make good use of an adjustable-rate mortgage.

Payment penalties

Different types of lenders have varying terms and conditions. For instance, there are mortgage lenders who have a prepayment penalty option. These lenders often convince borrowers to take the option. In a mortgage contract, this clause essentially gives the lender the liberty to collect additional money when you make early payment or additional payments beyond a given limit with a view of reducing the debt. Over time, it can be very costly. You can make extra payments if you are in a good financial position as it will help reduce your debt. For the clause, do not consent to the idea.

Working with a reputable mortgage broker is highly recommendable especially when you are in a tight financial spot and you need to make critical choices. A broker will help you to make use of all these ideas in the most effective way.

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Understanding Average Rental Prices in Montreal, Vancouver and Toronto

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One of the first steps of becoming a savvy investor in Canada’s real estate scene is to be familiar with the average rental prices in Vancouver, Montreal and Toronto. This invaluable knowledge will also prevent you from making any regrettable decisions.

Rental prices in Montreal

Montreal is popularly known as a city of renters because it has a great reputation for being a town with good bang for your rental buck. In fact, it has the largest rental market in Canada with rental housing options such as duplexes, triplexes and apartments. Montreal offers a broad range of old and new dwellings that offer a variety of architecture and styles to suit many tastes.

When it comes to rental apartments in and around Montreal, the average rental price is over $1,100. In addition, one-bedroom apartments can be rented for approximately $970 and two-bedroom apartments can be rented for approximately $1,180 per month on average. Over the years, studies have shown that the average rental rates for one-bedroom apartments have decreased by 0.5% and two-bedroom apartments have decreased by 3.1%.

Rental prices in Vancouver

Vancouver has the highest rental rate throughout Canada and it is approximately $1,280 per month on average, and that’s why Vancouver’s tenants are starting to feel the squeeze as rentals prices keep increasing. In addition, nearly half of Vancouver’s population rents. These tenants prefer to live older apartment buildings that are located along Main Street and other arterial roads.

Still, there are other tenants who rent bigger houses that are “carved” up into luxurious suites. One of the reasons why Vancouver’s rental apartments can fetch up such a high price is because investors tear these units down then builds them anew. Once these units receive a facelift, their owners can then easily double the price of the rental fees.

Rental prices in Toronto

Just like Vancouver, Toronto also tops the list when it comes to high rental prices. The price of a rental two-bedroom unit is more than $1,260 per month on average. Just west of Toronto, there are units in Burlington that go up to $1,550. What’s more, Burlington is just one part of the Greater Toronto Area and already has a population of over 175,000. In addition, an increasing number of new housing developments are springing up and rental properties are becoming more popular with people who work in Toronto while wanting to stay away from the hustle of a big city.

Interested in buying a second home in one of these cities to rent out?

You should first know that you are going to be a landlord, and that’s why learning how to manage the property and your tenants come with great pertinence. There are a lot of ways to invest in a rental property, and it starts with choosing an apartment that’s located near your child’s college or a unit in an existing multifamily condominium. The next thing to keep in mind is not to neglect to run the numbers. From online mortgage calculators to a mortgage broker, there are many avenues that allow you to get help to calculate down payments, insurance, taxes, and more.

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Shopping For Real Estate As A Single Woman?

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The statistics of the typical first-time homebuyers are fast changing today. A lot of single women these days can afford to buy properties on their own to build up valuable equity, and are no longer waiting to find a life partner prior to pursuing the lifestyle and financial advantages of owning a home. One in every first-time property buyers today is a single woman, and new property market is in sense beginning to reflect that.

While most of these women are ready to jump into the commitment of owning a home, not all of them are willing are give their valuable time to outdoor chores such regular yard or garden maintenance. As such, the majority of these women tend to purchase homes that require little or no maintenance, but with an option to plant container gardens.

Condominium offers

The easiest and most fashionable way to hold onto their maintenance-free lifestyle is to acquire a condo. These properties are problem-free when it comes to their upkeep and unencumbered lifestyle is an obvious advantage to people that would rather not be tied up every weekend with maintenance chores.

Condominium unit owners are charged a flat monthly rate to cover maintenance of the common areas in addition to provide prompt service by reputable maintenance service providers if there are maintenance issues in any single unit. Problems related to electrical, plumbing, air conditioning and heating systems are handled by pre-approved maintenance staff as agreed with the condo management or association. This means help is available at a moment’s notice.

Financing purchases

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Women looking forward to purchase their first home have two options to opt for when it comes to financing their purchase; paying cash or through a home purchase loan product such as a mortgage. But whichever the financing option, it is critical that they work out a practical budget. This does not just imply working on a budget they can afford based on their current state of affairs but that can allow some room for changes. Skilled private mortgage experts in Canada recommend keeping mortgage interest rates as low as possible.

Consider other day to day living costs

When mulling over how much you should borrow, it is critical to allow for increases in other living costs, particularly where utilities and food are concerned. All these should not scare you off purchasing that great condominium you have always wanted but rather to urge you to work out a budget that you can comfortably afford. Once you have found a dream property to purchase, it is easy to forget other things that are equally important for your day to day living.

Use a home loan calculator

Make use of a home loan calculator to help you easily determine the kind of a home buying budget you can afford. When calculating what you can really afford, it is critical not to ignore your supplementary expenses. For instance, if you love eating out, or going to the theatre, or even indulging your passion for surfing, then make certain to include these costs. This way, you will know what kind of a condo or any other home type you can afford without having to give up your favorite hobbies.

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Pay Your Mortgage Earlier For Peace Of Mind!

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Paying off your mortgage early is the surest way to give yourself a peace of mind especially when there is so much on your plate. Early payment of mortgage makes sense because most people want the security and psychological merit that comes with home ownership free from the burden of debts. While finding experts who offer recommendations for early payment of mortgage is an ideal step, you can still pay off your mortgage using methods that are faster and safer as compared to others. Here is a look at some of the effective ideas for loan payment.

Mortgage calculators

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The magic is usually in the mortgage calculator. When you play wisely with the mortgage calculator, you will clearly see how the addition of little payment to your principal here and there significantly reduces the length of your loan. The key thing here is trying to figure out an affordable amount of money that can reduce the loan-term without affecting your financial position. When you pay a little more principal, you get a bonus. As your principal gets lower, payments made henceforth are applied on your principal. Always make sure that when you are paying extra, it is applied on the principal balance instead of being set aside for the next payment.

Short-term mortgage refinance

A 15-year mortgage is quite common though you can refinance into a mortgage for 10, 15 or 20 years. Therefore, you may want to consider a 15-year mortgage because it may not be as high you think even though people think high payment is involved. The advantage of a 15-year mortgage is getting committed to the higher payment. You hardly get a chance to dither about your ability to afford the extra payment every month. In that case, you can achieve the effect of a short-term mortgage (when working with a 30-year loan-term) by making payments as though you were paying for a 15-year loan-term. This puts in you in control instead of the money lender.

Consider biweekly payment option

A year has 52 weeks and 12 months. Biweekly payment works best when you make plans while factoring 52 weeks and 12 months in a year. Therefore, when you pay half the regular mortgage payment every other week, you will make 26 half-payments by the end of the year. That is equivalent to 13 full monthly payments. This extra amount of money at the end of every year can chop off about 5-6 years of your 30-year mortgage. You can check with your bank to see if there is any arrangement for a biweekly payment plan. Some banks will charge while some will offer free service.

It is everyone’s dream to own a home without the stress of pending mortgage payments, foreclosures, high mortgage rates and the like. With these three simple ideas, you can take your time to figure out one that is likely to benefit you the most. All these ideas aim at reducing your mortgage payment making it possible to pay it off earlier so you can have peace of mind in your lovely home.

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