Miss Mortgage

Canadian Household Debt

Canadian household debt is on the rise and as the world economy continues to slip, the state of Canadian household finances are revealing some very sobering statistics: 

The Vanier Institute has just released a look at the family finances of Canadians.  

Here are some highlights extracted from the 2011 report:

-       Average household debt climbed to a record $100,000 per family in 2009;

-     The debt-to- income ratio, which measures household debt against income, stands at a record 150%, meaning that for every thousand dollars in after- tax income, Canadian families owe one thousand five hundred dollars;

-     The number of households which have fallen behind in their mortgage payments by three of or more months climbed to 17,400 in the fall of 2010, up nearly 50% since the recession began.  In October 2010, some 17,400 mortgages were in arrears by three or more months.

-     Credit card delinquency and bankruptcy rates also remained higher than pre-recessionary levels.

-     In November 2010, the Multiple Listing Service (MLS) average residential selling price was $344,000, equal to 5.1 times the average household disposable income. This compares to an average of 3.7 times over the last two decades, and only 3.9 times as recently as 2004.  The increase in housing prices was mostly due to record low interest rates, lower down payment requirements, and longer amortization periods over which to pay back the mortgage. This created increased demand for homes among consumers and has contributed to the makings of a housing price bubble.  The conditions are still in place for a correction in house prices; when and by how much is the difficult question.  The “when” seems to be getting closer and closer or may have already arrived. Over time, the price decline could easily be in the double digit range. US house prices have fallen by more than one-quarter since 2006. Falling house prices may be good news for new home buyers but will erode the assets and balance sheets of many Canadian homeowners.

A copy of the Vanier Institute report (dated February 2011) can be accessed at the following link:

 http://www.vifamily.ca/media/node/783/attachments/familyfinance2010.pdf

This blog was posted by Elizabeth Blair on March 13, 2011.  Elizabeth is a Licensed Mortgage Agent with Mortgage Edge in Richmond Hill, Ontario.  Elizabeth services mortgage clients in Mississauga and all over the Greater Toronto area.

You can contact Elizabeth directly by phone at (905) 510-5785

by email at eblair@mortgageedge.ca

or you visit any of her websites at:

www.missmortgage.ca

www.burlington-mortgage.ca

www.oakville-mortgage.com

www.streetsville-mortgage.ca

Elizabeth is licensed with the Financial Services Commission of Ontario and is also a Member of IMBA (the Independent Mortgage Brokers Association of Ontario) www.imba.ca

Lic # M08005880 / Brokerage Lic # 10680

Head office is located at:  15 Wertheim Court, Suite 210, Richmond Hill, Ontario, Canada.

 

 

Next Exit....Financial Freedom

I come across many individuals who are looking for mortgage financing and also discover that there are many mortgage applicants who are carrying very large amounts of debt.  I wanted to tell you that there is help available to you from InCharge Debt Solutions Canada.

InCharge Debt Solutions Canada is a non-profit, charitable organization offering confidential and professional budget counselling, debt repayment plans, and financial education. 

Counselling services are available and are free of charge to you!   

InCharge Debt Solutions can assist by:

• Combining multiple payments into one affordable monthly payment;
• Eliminate or reduce interest rates; and
• Eliminate late charges and over the limit fees.

Call InCharge today at 1-888-424-3454 (let them know Elizabeth Blair from Mortgage Edge referred you)  to find out how their programs can help you move into financial freedom

....... Click Here to Read More about InCharge

Elizabeth Blair

Mortgage Edge

Phone:  905-510-5785

Website:   www.missmortgage.ca

email:    eblair@mortgageedge.ca

What if there is a past bankruptcy?

If you have had a recent backruptcy and are thinking of applying for a mortgage, you need to do two things:

1)  start rebuilding your credit

2)  save up enough cash to make up at least a 15% - 20% downpayment plus have enough cash to cover your closing costs

If you have recently come through a bankruptcy, you need to get back on track with building up your credit history again.   Some people will shy away from using credit again, after going through a bankruptcy, but if you have any desire to get mortgage financing, you must ensure you get right back into using credit in order to establish that credit and get your credit rating back up again.  Mortgage lenders will not advance mortgage funds to anyone with no credit history because it is perceived as being "risky".    YES, you can get a mortgage, even if there is a past bankruptcy.

If your credit applications are being declined, here is an easy way for you to start rebuilding your credit. Apply for a secured VISA card that will allow you to rebuild your credit. By putting down a security deposit (minimum of $1,000) you can begin using that card, just like a regular credit card (up to that limit). Over time, your own credit will be established. Here is a link to the application form that you can fill in and send in:

http://www.missmortgage.ca/SecuredVISA.pdf

Your Credit Report and Credit Score

Since I began working in the mortgage financing industry, I have discovered that several of my clients had questions about their credit reports and their credit scores.   Here are some of the typical questions I have been asked:

1.  How is my credit score derived?

2.  What things negatively affect my credit score?

3.  How do I get my credit score back up?

4.  What is the highest credit score one can achieve?

5.  How did my credit score get that low?

Well, of course I don't have all the answers and because there were so many other questions directed at me regarding credit reports, I began searching hard for the proper information to give to my clients.  I found a publication by the Financial Consumer Agency of Canada entitled "Understanding Your Credit Report and Credit Score".  I highly recommend it to you as an excellent resource.  It explains just about everything you ever needed to know about your credit report and it will most certainly answer many of your own questions. 

Simple Strategies to Help Eliminate Credit Card Debt

Managing debt takes persistence and dedication but once you rein in your debt, you'll be glad you did, and you'll be much better off financially and emotionally.

Here are a few ways to get you started toward eliminating your debt:

Pay more than the minimum payment each month. Did you know the minimum payment amount is usually 2 to 3% of your balance? On a $2,500 credit card balance with a 2 percent minimum payment, you would pay only $50 toward decreasing that debt and the majority would be applied towards interest and not principal. Pay a little more than the minimum payment required each month and you'll be surprised at how fast that credit card balance decreases.

... read more...