Top 10 Ways to Save money on your mortgage #6

November 5, 2008 by Camilo Rodriguez.

Top #6 Be Aware of your Mortgage Renewal Date  

An example best illustrate this strategy.  This client had his mortgage with CIBC, balance $280,000 and an interest rate of 5.4%.  His mortgage was up for renewal and he contacted me 6 months prior.

1.  Mortgage Renewal by Mail (current bank)

•  CIBC (new proposed interest rate) - 5 year term at 6.20%

2.  Shopping around, (Best rates strategy)

•  BMO - 5 year term at 6.10%
•  ING Direct - 5 year term at 5.99%
•  TD Canada Trust - 5 year term at 5.99%

3.  Being aware of interest rates

•  I kept track of interest rates for 6 months for this client, 4 months before their renewal, rates dropped to 5.74%.
•  Since I am aware of the mortgage rates of most lenders and when they drop or increase, I was able to lock in the rate for his mortgage at a lower rate than all other banks.
•  By being aware, the clients allowed me to save them $3,314.71 in interest on top of the best 3 options or $6,103.83 if they would just had renewed via mail.
•  This strategy works when you let me know before hand your mortgage is coming up for renewal.  Most clients wait until 1 month prior and the only solution at that time is shopping around.  In most cases they realized the banks do not give them their best choice but it is too late to change.
•  The secret is to let me know your mortgage is up for renewal minimum 6 months prior.  Or to send me a copy of your last mortgage statement so I can know when your mortgage is up for renewal.
•  There is no cost for a mortgage renewal and you are free to choose which bank you want to go with.  You can also change from variable to fixed rate or vice versa.

•  In this graph, using current average mortgage rates for 2007, if your mortgage was up for renewal in July and you went to the bank to negotiate the rate 15 days prior, you completely missed the opportunity to reduce your interest rate by 0.5%.  In a $200,000 mortgage that would be savings of $5,000 over your next 5 years.

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Mortgage Opportunities for the Small Investor, Become a Bank!

November 1, 2008 by Camilo Rodriguez.

 

Due to the Mortgage Crisis, there is currently a few opportunities to lend money secured by Real Estate in Vancouver.

* Principal is secured by a home in Vancouver
* Low risk type of investment
* Interest rates around 8% to 12% per year
* You become the bank
* Mortgage Term 1 year, others available

If you know of anybody interested, please contact me at:  http://camilo.ca

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Mortgage Crisis, Stock Market and Warren Buffet

October 23, 2008 by Camilo Rodriguez.

Warren E. Buffett is one of the wealthiest investors alive, you may want to think what he says, what he does and if you are in the martket for Real Estate, what lessons can you learn from his way of thinking.  Here a picture of Warren Buffet and his friend Bill Gates.  CR 

October 17, 2008

Op-Ed Contributor

Buy American. I Am.

By

WARREN E. BUFFETT

Omaha

THE financial world is a mess, both in the United States and abroad. Its problems, moreover, have been leaking into the general economy, and the leaks are now turning into a gusher. In the near term, unemployment will rise, business activity will falter and headlines will continue to be scary.

So … I’ve been buying American stocks. This is my personal account I’m talking about, in which I previously owned nothing but United States government bonds. (This description leaves aside my Berkshire Hathaway holdings, which are all committed to philanthropy.) If prices keep looking attractive, my non-Berkshire net worth will soon be 100 percent in United States equities.

Why?

A simple rule dictates my buying: Be fearful when others are greedy, and be greedy when others are fearful. And most certainly, fear is now widespread, gripping even seasoned investors. To be sure, investors are right to be wary of highly leveraged entities or businesses in weak competitive positions. But fears regarding the long-term prosperity of the nation’s many sound companies make no sense. These businesses will indeed suffer earnings hiccups, as they always have. But most major companies will be setting new profit records 5, 10 and 20 years from now.

Let me be clear on one point: I can’t predict the short-term movements of the stock market. I haven’t the faintest idea as to whether stocks will be higher or lower a month — or a year — from now. What is likely, however, is that the market will move higher, perhaps substantially so, well before either sentiment or the economy turns up. So if you wait for the robins, spring will be over.

A little history here: During the Depression, the Dow hit its low, 41, on July 8, 1932. Economic conditions, though, kept deteriorating until Franklin D. Roosevelt took office in March 1933. By that time, the market had already advanced 30 percent. Or think back to the early days of World War II, when things were going badly for the United States in Europe and the Pacific. The market hit bottom in April 1942, well before Allied fortunes turned. Again, in the early 1980s, the time to buy stocks was when inflation raged and the economy was in the tank. In short, bad news is an investor’s best friend. It lets you buy a slice of America’s future at a marked-down price.

Over the long term, the stock market news will be good. In the 20th century, the United States endured two world wars and other traumatic and expensive military conflicts; the Depression; a dozen or so recessions and financial panics; oil shocks; a flu epidemic; and the resignation of a disgraced president. Yet the Dow rose from 66 to 11,497.

You might think it would have been impossible for an investor to lose money during a century marked by such an extraordinary gain. But some investors did. The hapless ones bought stocks only when they felt comfort in doing so and then proceeded to sell when the headlines made them queasy.

Today people who hold cash equivalents feel comfortable. They shouldn’t. They have opted for a terrible long-term asset, one that pays virtually nothing and is certain to depreciate in value. Indeed, the policies that government will follow in its efforts to alleviate the current crisis will probably prove inflationary and therefore accelerate declines in the real value of cash accounts.

Equities will almost certainly outperform cash over the next decade, probably by a substantial degree. Those investors who cling now to cash are betting they can efficiently time their move away from it later. In waiting for the comfort of good news, they are ignoring Wayne Gretzky’s advice: “I skate to where the puck is going to be, not to where it has been.”

I don’t like to opine on the stock market, and again I emphasize that I have no idea what the market will do in the short term. Nevertheless, I’ll follow the lead of a restaurant that opened in an empty bank building and then advertised: “Put your mouth where your money was.” Today my money and my mouth both say equities.

Warren E. Buffett is the chief executive of Berkshire Hathaway, a diversified holding company.

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Mortgage News: BC Migration

October 22, 2008 by Camilo Rodriguez.

One of the factors for increasing prices in Real Estate is the number of new people arriving to a region.  Other factors include job creation, mortgage rates etc.  To keep it simple, supply and demand.  The chart below shows BC receiving net inflow of people from other provinces (except Saskatchewan) for 2007, and expected for 2008.
Click to Enlarge…

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Top #7 – Include all your other debts into a secured line of credit or into your current mortgage

October 21, 2008 by Camilo Rodriguez.

Top 10 Ways to Save Money in your Mortgage 

Top #7 – Include all your other debts into a secured line of credit or into your current mortgage    
Most people now have visas, car payments and bank lines of credits at different interest rates.  It is also true that most of these accounts have interest rates higher than your current mortgage or a secured line of credit.  Why pay more? 

As an example, you may have a first mortgage for $150,000 at 5.9%, total visas for $20,000 at 18%, car loan for $15,000 at 7% and a line of credit for $10,000 at 9%.   You can easily replace all of them into one single mortgage of $195,000 and save between $900 to $1,200 per month.  

You can also keep 2 accounts: your stand alone mortgage and a secured line of credit for all your other accounts.  You would save the same and you would keep your mortgage separate from your other liabilities. 

The best saving tip would be to include all your debts as explained before and maintain the same higher payment.  This way, the $900 to $1,200 per month would go to pay off the principal directly (it would not pay any interest at all), thus paying off BOTH your mortgage and your other obligations faster and saving you years of payments. 

As a bonus, your credit report will improve by using this technique, giving you access to lower and lower interest rates (mortgage and others).   Please make a note that when you pay off your other accounts, leave them open because closing accounts might not help improve your overall credit rating.

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Mortgage Crisis is a Mortgage Opportunity for the Government of Canada

October 20, 2008 by Camilo Rodriguez.

Ottawa may make millions on CMHC plan for banks -TARA PERKINS AND BOYD ERMAN Globe and Mail

The federal government stands to make hundreds of millions of dollars off of its new program to buy mortgages from banks.

The government today is launching the first purchase of $5-billion of mortgages from Canada’s banks as part of a program to buy $25-billion of home loans from banks to give them cash to make new loans.

It is taking advantage of its ability to borrow cheaply to buy the mortgages, which will pay a higher rate of interest. The difference will be the government’s profit.

Ottawa doesn’t have a forecast of its likely take, but given current market prices and the guidance that the Finance Department has provided to bankers on the prices to be paid, the federal government may expect to earn about $250-million a year. That could rise to $1-billion if the government increases the size of the mortgage purchases to $100-billion, as some in the banking sector suggest could be done.

Those potential profits are significant at a time when Ottawa projects its surplus will fall to $1.3-billion for the year ended March, 2010.

While government officials say any profit isn’t the point, earning money on the program does drive home the message that Ottawa has been sending: The program isn’t a bailout at taxpayers’ expense.

“The goal is not to make money for the government,” said a Finance Department official who spoke on condition of anonymity. While the program is an efficient way to support lending in Canada by providing reliable funding to banks, it is important that the banks pay a competitive rate to tap into the funds, the official said.

“This is not a subsidy for banks.”

The credit crunch, which first erupted more than a year ago, has made it more expensive for banks to raise long-term funding to finance mortgages.

Finance Minister Jim Flaherty announced the initiative last Friday to have government-owned Canada Mortgage and Housing Corp. buy up loans from banks. The loans are solid, but by taking them off bank balance sheets in return for cash, the banks will theoretically be able to make new loans.

Ottawa has committed to buy up to $25-billion in total, but has not yet set the dates for the remaining purchases. Participants expect the government to carry out four more purchases of $5-billion each.

The purchases will be conducted by so-called reverse auction, where banks will essentially have to tell the government how much they will pay in the form of interest to move the loans off their balance sheets. The government will accept the most profitable bids.

Mortgage lenders can submit up to three bids for various amounts, but no one lender can sell more than $1.25-billion of loans to the government.

The government will establish a minimum acceptable yield, or interest rate. That minimum is expected to be above the yield on comparable five-year Canada Mortgage Bonds that CMHC sells to investors.

Banks are expected to place bids somewhere above the minimum, with more-stressed banks giving the government a better deal as they try to ensure they can raise cash.

John Manley, a former deputy prime minister and finance minister, said he was surprised Ottawa didn’t pick up the program earlier.

“They make money on it, it increases liquidity in the system – why don’t you answer the phone when people suggest things?” he said, pointing out that banks had been suggesting the program for some time.

One bank chief executive officer said that, even as the financial crisis worsens, Canada is in a unique position where it can establish programs to ease the flow of funds that don’t put taxpayers on the hook. A shortage of government bonds and an excess of mortgages sitting on the banks’ books make this an easy program to increase if necessary, he said.

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Mortgage Analysis from the Department of Finance, Canada

October 18, 2008 by Camilo Rodriguez.

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2008 World Financial Crisis - Mortgages

October 18, 2008 by Camilo Rodriguez.

Excellent video explaining the 2008 Financial Crisis, very plain terms!

financial-crisis-2008.wmv

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Canada rated world’s soundest bank system: survey

October 13, 2008 by Camilo Rodriguez.

Special Thanks to Vince Vesser, friend and excellent Realtor with Homelife Realty for the lead to this article.  Excellent news now in times of turbulence in the Mortgage Market, even in Canada!

By Rob Taylor

CANBERRA (Reuters) - Canada has the world’s soundest banking system, closely followed by Sweden, Luxembourg and Australia, a survey by the World Economic Forum has found as financial crisis and bank failures shake world markets.

But Britain, which once ranked in the top five, has slipped to 44th place behind El Salvador and Peru, after a 50 billion pound ($86.5 billion) pledge this week by the government to bolster bank balance sheets.

The United States, where some of Wall Street’s biggest financial names have collapsed in recent weeks, rated only 40, just behind Germany at 39, and smaller states such as Barbados, Estonia and even Namibia, in southern Africa.

The United States was on Thursday considering buying a slice of debt-laden banks to inject trust back into lending between financial institutions now too wary of one another to lend.

The World Economic Forum’s Global Competitiveness Report based its findings on opinions of executives, and handed banks a score between 1.0 (insolvent and possibly requiring a government bailout) and 7.0 (healthy, with sound balance sheets).

Canadian banks received 6.8, just ahead of Sweden (6.7), Luxembourg (6.7), Australia (6.7) and Denmark (6.7).

UK banks collectively scored 6.0, narrowly behind the United States, Germany and Botswana, all with 6.1. France, in 19th place, scored 6.5 for soundness, while Switzerland’s banking system scored the same in 16th place, as did Singapore (13th).

The ranking index was released as central banks in Europe, the United States, China, Canada, Sweden and Switzerland slashed interest rates in a bid to end to panic selling on markets and restore trust in the shaken banking system.

The Netherlands (6.7), Belgium (6.6), New Zealand (6.6), Malta (6.6) rounded out the WEF’s banking top 10 with Ireland, whose government unilaterally pledged last week to guarantee personal and corporate deposits at its six major banks.

Also scoring well were Chile (6.5, 18th) and Spain, South Africa, Norway, Hong Kong and Finland all ending up in the top 20.

At the bottom of the list was Algeria in 134th place, with its banks scoring 3.9 to be just below Libya (4.0), Lesotho (4.1), the Kyrgyz Republic (4.1) and both Argentina and East Timor (4.2).

RANKINGS

1. Canada

2. Sweden

3. Luxembourg

4. Australia

5. Denmark

6. Netherlands

7. Belgium

8. New Zealand

9. Ireland

10. Malta 11. Hong Kong

12. Finland

13. Singapore

14. Norway

15. South Africa

16. Switzerland

17. Namibia

18. Chile

19. France

20. Spain

——————————————–

124. Kazakhstan

125. Cambodia

126. Burundi

127. Chad

128. Ethiopia

129. Argentina

130. East Timor

131. Kyrgyz Republic

132. Lesotho

133. Libya

134. Algeria

SOURCE: World Economic Forum Global Competitiveness Report 2008-2009.

(For the full World Economic Forum report click on: http://www.weforum.org/GCR0809_Browser )

http://ca.news.yahoo.com/s/reuters/081009/n_top_news/cnews_us_financial_soundest_banks

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Canada US Mortgage Market - You Tube Video by Camilo

October 12, 2008 by Camilo Rodriguez.

My first video in You Tube, enjoy!
http://www.youtube.com/watch?v=B49I7G2xn3Q

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Top 10 Ways to Save Money in your Mortgage - #8

October 9, 2008 by Camilo Rodriguez.

Top #8 – Convert your Mortgage to a Tax Deductible Mortgage    

If you borrow money to create more money, the interest is tax-deductible. The interest is considered a legitimate business expense and can be used to reduce profitability, and therefore, taxes. If you borrow money to invest with and receive growth on it, the interest is a legitimate expense in your hands. 

Here is as an example on how to create a tax-deductible mortgage: you first sell your investment assets (ex. Non Registered Mutual Funds or Term Deposits) and cash them in; be aware there will be a small tax bill to pay on any capital gains you realize. Second, use this cash to pay off your residential mortgage (or a portion of it). Third, arrange a new mortgage (usually a secured line of credit). Fourth, use the new mortgage money to buy back the investment assets you originally sold. 

You could also do it by acquiring other assets such as rental properties etc.  You should speak with an accountant to set it up properly and with a mortgage broker who knows how to structure it well. 

Happy Savings!

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Bank of Canada cuts key rate in coordinated move with other Countries Central Banks

October 8, 2008 by Camilo Rodriguez.

From Reuters, unexpected news from the Bank of Canada.
Please note this is great news for people with Lines of Credit Mortgages or Variable Rate Mortgages.
Families with Fixed Rate Mortgages are unaffected.  Prime rate is today at 4.25%.  Banks only reduced their prime bank rate by 0.25% to 4.5%.  Camilo Rodriguez.

TORONTO (Reuters) - The Bank of Canada unexpectedly cut its key interest rate by 50 basis points to 2.50 percent on Wednesday in a coordinated effort with other central banks to help calm ailing financial markets.

In a statement that left the door open to further rate cuts, the bank said the intensification of the global financial crisis was impacting all countries and that conditions in global financial markets have worsened considerably.

“In recent weeks conditions in global financial markets have deteriorated sharply, the U.S. economy has weakened further, and commodity prices have fallen abruptly,” the Bank of Canada said in a statement.

“As a result of these developments, credit conditions in Canada have tightened significantly, despite the relative health of our financial institutions.”

The decision to lower its key rate ahead of its scheduled interest rate announcement on October 21 came along with rate cuts from central banks across the world, including the U.S. Federal Reserve, European Central Bank and Bank of England. China also lowered benchmark rates.

The Bank of Canada said weaker growth in the United States and other key trading partners will increase the drag on the domestic economy coming from net exports.

It also said the recent easing of the Canadian dollar will help cushion the effects of the weaker global outlook on the domestic economy but will not completely offset them.

The rate cut, which marks the bank’s biggest interest rate cut since back-to-back 50-basis-points cuts in March and April, marks the first time since September 2001 that the Bank of Canada has moved on interest rates outside of its fixed announcement dates, which were implemented in 2000.  Continued… 

http://www.reuters.com/article/euDealsNews/idUSTRE49752G20081008?sp=true

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Why the Rich get all the Tax Breaks!

October 2, 2008 by Camilo Rodriguez.

Outstanding email sent to my by Roger LeBlanc, realtor with Homelife.  Please read below and understand why the rich are rich, the poor are poor and the system works they way it does!

Tax System Explained: Bar Stool Economics

Suppose that every day, ten men go out for beer and the bill for all ten comes to $100. If they paid their bill the way we pay our taxes, it would go something like this: The first four men (the poorest) would pay nothing.The fifth would pay $1.The sixth would pay $3.The seventh would pay $7.The eighth would pay $12.The ninth would pay $18.The tenth man (the richest) would pay $59. 

So, that’s what they decided to do. 

The ten men drank in the bar every day and seemed quite happy with the arrangement, until one day, the owner threw them a curve. ‘Since you are all such good customers,’ he said, ‘I’m going to reduce the cost of your daily beer by $20.’ Drinks for the ten now cost just $80.  The group still wanted to pay their bill the way we pay our taxes so the first four men were unaffected. They would still drink for free. 

But what about the other six men - the paying customers? How could they divide the $20 windfall so that everyone would get his ‘fair share?’

They realized that $20 divided by six is $3.33. But if they subtracted that from everybody’s share, then the fifth man and the sixth man would each end up being paid to drink his beer. So, the bar owner suggested that it would be fair to reduce each man’s bill by roughly the same amount, and he proceeded to work out the amounts each should pay.  And so:The fifth man, like the first four, now paid nothing (100% savings). The sixth now paid $2 instead of $3 (33%savings). The seventh now pay $5 instead of $7 (28%savings).The eighth now paid $9 instead of $12 (25% savings).The ninth now paid $14 instead of $18 (22% savings).The tenth now paid $49 instead of $59 (16% savings). 

Each of the six was better off than before. And the first four continued to drink for free. But once outside the restaurant, the men began to compare their savings. 

‘I only got a dollar out of the $20,’declared the sixth man. He pointed to the tenth man,’ but he got $10!’ 

‘Yeah, that’s right,’ exclaimed the fifth man. ‘I only saved a dollar, too. It’s unfair that he got ten times more than I got’ 

‘That’s true!!’ shouted the seventh man. ‘Why should he get $10 back when I got only two?
The wealthy get all the breaks!’ 

‘Wait a minute,’ yelled the first four men in unison. ‘We didn’t get anything at all.
The system exploits the poor!’ 

The nine men surrounded the tenth and beat him up. 

The next night the tenth man didn’t show up for drinks so the nine sat down and had beers without him. But when it came time to pay the bill, they discovered something important.
They didn’t have enough money between all of them for even half of the bill! 

 And that, ladies and gentlemen, journalists and college professors, is how our tax system works. The people who pay the highest taxes get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy, and they just may not show up anymore. In fact, they might start drinking overseas where the atmosphere is somewhat friendlier. 

For those who understand, no explanation is needed.
For those who do not understand, no explanation is possible.

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Top 10 Ways to Save Money in your Mortgage - #9

September 23, 2008 by Camilo Rodriguez.

Top #9 - Go Variable Rate and Make a Fixed Rate Payment

Most of the time, when a person goes for a variable rate mortgage, what they like is the ‘savings’ in payments compared to the fixed rate.

In reality, they are just spending less rather than saving.If you really want to save a lot of money in mortgage interest, choose to pay it as if it was a fixed rate mortgage and save the difference when you choose a variable rate mortgage.

The difference between the 2 payments will go to pay the principal amount on your mortgage.

As an example, let’s say that you just purchased a home and you have a mortgage of $250,000 for a 5 year term at a rate of 5.5%.You also chose an amortization of 25 years. Let’s also assume that the variable rate mortgage is Prime -0.5% and the variable rate is 4.75%:

Fixed rate payment @ 5.5%           = $1,526
Variable Rate Payment @ 4.25%  = $1,350
Payment Difference                          = $   176

You then choose the variable rate mortgage at prime-0.5% but the payments are based on the 5 year fixed term @ 5.5%.What happens is that the payment difference or $176/month are applied to your principal, reducing your mortgage balance and/or years left to pay off your mortgage.

In plain terms, having the additional $176/month payment on your $250,000 mortgage will save you:
$31,648 in interest expense over 25 years.
4 years and 7 months of payments.

You can multiply this effect by going bi-weekly or weekly vs. monthly payments.See my Top #10 way to Save Money on your Mortgage.

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Credit Coaching

September 15, 2008 by Camilo Rodriguez.

Here some important Credit Report information from a Mortgage Lender Merix Financial.

As the deadline for changes  to high-ratio government guaranteed mortgages approaches, now is the time to start coaching those clients to improve their credit scores.

Many of your clients who have below a 620 beacon score, may have challenges finding mortgage financing in the near future.

After Oct 15, at least one applicant on a high ratio mortgage application MUST have a minimum 620 beacon score at all insured lenders. Some products such as a Home Equity Line Of Credit, require a 650 beacon score.

Below is a chart to show you the factors that make up a credit score, the classification of each and some HOT TIPS! on keeping a good score or improving a low one. This is great information to share with future applicants who will no longer qualify for high ratio financing.

These percentages are based on the importance of the 5 categories for the general population. For particular groups - for example, people who have not been using credit long - the importance of these categories may be somewhat different.

Payment History

· Account payment information on specific types of accounts (credit cards, retail accounts, installment loans, finance company accounts, mortgage, etc.)

· Presence of adverse public records (bankruptcy, judgments, suits, liens, wage attachments, etc.), collection items, and/or delinquency (past due items)

· Severity of delinquency (how long past due)

· Amount past due on delinquent accounts or collection items

· Time since (recency of) past due items (delinquency), adverse public records (if any), or collection items (if any)

· Number of past due items on file

· Number of accounts paid as agreed

Amounts Owed

· Amount owing on accounts

· Amount owing on specific types of accounts

· Lack of a specific type of balance, in some cases

· Number of accounts with balances

· Proportion of credit lines used (proportion of balances to total credit limits on certain types of revolving accounts)

· Proportion of installment loan amounts still owing (proportion of balance to original loan amount on certain types of installment loans)

Length of Credit History

· Time since accounts opened

· Time since accounts opened, by specific type of account

· Time since account activity

New Credit

· Number of recently opened accounts, and proportion of accounts that are recently opened, by type of account

· Number of recent credit inquiries

· Time since recent account opening(s), by type of account

· Time since credit inquiry(s)

· Re-establishment of positive credit history following past payment problems

Types of Credit Used

· Number of (presence, prevalence, and recent information on) various types of accounts (credit cards, retail accounts, installment loans, mortgage, consumer finance accounts, etc.)

Please note that:

· A credit score takes into consideration all these categories of information, not just one or two.  No one piece of information or factor alone will determine your score.

· The importance of any factor depends on the overall information in your credit report.  For some people, a given factor may be more important than for someone else with a different credit history. In addition, as the information in your credit report changes, so does the importance of any factor in determining your credit score. Thus, it’s impossible to say exactly how important any single factor is in determining your score - even the levels of importance shown here are for the general population, and will be different for different credit profiles. What’s important is the mix of information, which varies from person to person, and for any one person over time.

· Your credit score only looks at information in your credit report.
However, lenders look at many things when making a credit decision including your income, how long you have worked at your present job and the kind of credit you are requesting.

· Your score considers both positive and negative information in your credit report.

. Late payments will lower your score, but establishing or re-establishing a good track record of making payments on time will raise your credit credit score.
Here are just a few quick tips that can help put you in a better position under the discerning eye of an underwriter!

·  HOT TIP! Do you have past due balances that have been neglected? If they are showing up on your credit report and you want to purchase a home, make sure you bring them up to current status whenever possible.

·  HOT TIP! Do you have outstanding debt that you can afford to pay off right now? Try to get these accounts down to a zero balance, or at least a lower balance. If your cash on hand doesn’t allow you to do this, try to distribute the debt amongst other open credit cards. You can also consider opening a new line of credit and transferring part of the balance off a card that is close to being maxed out. If you can get the resulting balances below 50% of the available credit, you’re on the road to improving your credit score considerably in most cases.

·  HOT TIP! Do not close existing credit card accounts, even if you don’t want to deal with the company any more Believe it or not, the credit history is a good thing to have!

·  HOT TIP! When married couples keep separate credit card accounts, some or all of the balances can be transferred to one spouse’s list of accounts. This gives the other spouse an opportunity to increase their credit score and designate him or herself as the sole borrower on the mortgage loan. Ownership of the home can remain in both names!    

·  HOT TIP! See if your credit provider will increase your available lines of credit. This can, in turn, reduce the overall debt ratio, but only do this if your credit card company can do that without a hard credit inquiry. 

·  HOT TIP! Do you have past dues and charge-offs within the last two years? Pay them off now, if you can! Past dues older than two years will have little to no impact on your credit score if they are paid, but can possibly bring the score down, which is something we don’t want to do… Focus on that 2-year time frame.

·  HOT TIP! Do you see errors in your report? Request the credit bureau delete any outstanding debt that is incorrectly charged to you, or things that should have been removed that you have already paid. They have an obligation to reconcile this within 30 days. If you see items on your report that are less than two years old and you have the money to pay it off now, mark the back of your payment check with the following notation: Accepting this check is evidence that the transaction is complete and this charge will be deleted from my credit record. If necessary, you can use this cancelled check as proof of the transaction in the event the outstanding debt is not removed promptly and interferes with the closing of your loan.

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