Settling Unsecured Debts

If you are experiencing money problems, trouble paying your debts or your financial situation is deteriorating you need debt relief. Ideally, you can either avoid paying some of your unsecured debts or you can pay off some of your debts for less than 100 cents on the dollar. Depending upon the situation you might be able to settle one or more of your unsecured consumer debts for anywhere between 5% and 85% of the balance owing.

Type of debts where generous settlements may be available

If you owe money to the government the government will usually take the position that it wants you to repay the entire debt. It is also difficult to settle debts with certain types of consumer creditors such as a landlord or a utility; water, hydro, cable or internet service provider. If you do not pay your rent your landlord is going to evict you. If you do not pay your cable bill your cable service will be disconnected. However, there are plenty of opportunities to settle debts at major discounts with certain types of unsecured debts including credit cards, personal loans, lines of credit and cellular phone charges.

Settlements involving purchased debt

In Canada today about 90 per cent of the debts collection agencies attempt to collect are debts owned by the original creditor. However, in some cases a creditor will sell a large group of debts to a company called a debt buyer, a company that specializes in buying debts. Typically debt buyers purchase debts that are more than 3 years old for pennies on the dollar. If a collection agency is attempting to collect an older debt from you that is owned by a debt buyer the collection agency may be willing to settle this debt for as little for 5 cents or 10 cents on the dollar.

Settlements involving debts owned by the original creditor

Typically major credit grantors in Canada attempt to collect a debt on their own for 3 to 6 months before placing the accounts for collection on a commission basis with a collection agency. When an account is initially placed with a collection agency it is referred to as a first assign. Some creditors may not permit settlements on first assigns. Other creditors may permit settlements for approximately 85% of the balance owing. After a year a delinquent account may be recalled and placed with a new agency as a second assign and the creditor’s blanket settlement instructions may then be reduced to somewhere around 65% of the balance owing. Upon the expiry of another year the debt will likely become a third assign and the settlement guidelines may be reduced to approximately 50% of the balance owing.

In some cases it may be possible for a collection agency to obtain permission from its creditor-client to settle a debt for an amount even more generous than that permitted under the client’s blanket settlement instructions. A creditor may consider settling a debt for a lump sum payment less than its blanket settlement guidelines where the creditor is satisfied the consumer will never be in a position to repay the debt or the creditor is on the verge of insolvency.

Importance of obtaining a written settlement offer before making a payment

In the event you negotiate a settlement with a collection agency it is important that you obtain a satisfactory written settlement offer from the collection agency before making your payment to the collection agency. Failure to do so may result in the creditor or another collection agency attempting to collect the balance from you.

Visit Dominion Lending Centres Mortgage Village to consult a mortgage professional.

8 Negotiation Tactics To Help Reduce Your Credit Card Debt

Call at a good time: One of the simplest yet most effective negotiation tactics is to choose the right time to call a credit card company. Call first thing in the morning, as people are more likely to be pleasant and willing to help you out. If you call at the end of the day, people tend to be tired and cranky.

Let them know you will pay back your debt: What concerns credit card companies most are people who are trying all sorts of dirty negotiation tricks to get out of paying their debts altogether. It is crucial that you explain to them that you do intend to pay back your debt. What you are asking is some small help. If you do this nicely, you may be surprised how understanding credit card companies can be!

Take advantage of your first time: If you have not asked for a lower interest rate or to have a late fee waived with this credit card company before, make sure you tell them. These companies are usually much more generous with first time offenders than with those asking for extensions on a monthly basis.

Show them you are a loyal customer: If you've been a long-time customer or a big spender for several years, use this to your advantage. By reminding a company of your loyalty, you'll find that they will be more willing to renegotiate your credit card debt because they don't want to lose your business.

Ask for a lower interest rate: Unknown to many, credit card interest rates are often negotiable. If you have had a good payment history, you shouldn't have any problems with requesting for a lower interest rate. Explain that you'll be able to put more money towards paying off your principal balance instead of your interest rate charges.

Have late payment fees waived: This is such a simple, yet very effective bargaining tactic. Late payment fees can usually easily be waived if you settle your bill within a short period of the due date. If you have, leverage a solid credit history on top. An extra phone call, that is likely to be well worth the effort.

Request to miss a payment: If you have had some unexpected financial issues that you are expecting to resolve in the coming weeks or months, explain your situation honestly to the credit card company and ask very carefully if you could miss a payment or two. Beware though that these kind of skipped payments may have a bad impact on your credit rating.

Speak to the decision maker: An effective negotiation tip is to talk to the person in charge as soon as you can. When you first call, you will probably be diverted straight to a customer service representative. If this is the case, request to talk directly to the manager or another person who can make decisions. Don't forget to write down all the names, designations, and contact details of everyone you talk to, as well as the time, day, and details of the discussions.

Visit Dominion Lending Centres Mortgage Village to consult a mortgage professional.

How to Protect Yourself from Overzealous Debt Collectors: Know Your Rights

A couple of weeks back, a debt collection agency based in Glendale, Calif., agreed to pay $1 million to settle complaints from the Federal Trade Commission over its business practices. The agency, which went by the name “National Attorney Collection Practices,” had been harassing delinquent borrowers with debt collection notices bearing an illustration of Uncle Sam’s fist upending some hapless soul and “shaking him down” for loose change.

The harassment didn't end there.
Targeting Spanish-speaking debtors and lower-income consumers who’d fallen behind on loans to payday lending operations, “National Attorney” inundated debtors with phone calls, postal mailings, and text messages to their cellphones that: 

• falsely represented that its notices were coming from attorneys 
• "unlawfully … threatened legal action, arrest, imprisonment, or garnishment" if debtors didn’t pay up 
• and failed to include necessary “disclosures” advising debtors of their legal rights. 

In some cases, the FTC accused National Attorney of even sharing details about consumers’ debts with their friends, family, and co-workers, apparently in an attempt to pressure the consumers into paying. And to top it all off, the FTC says that National Attorney “refused to provide their business address or validation letters to consumers, thereby depriving consumers of the right to send cease-and-desist letters or to dispute alleged debts.”Summing up its charges, the FTC alleged that National Attorney “engaged in deceptive and unfair practices in almost every facet of their dealings with these consumers” — and fined the company $1 million.


Know Your Rights
Of course, the FTC can’t step in to stop every debt collector from breaking the law — at least not in real time.So what can you do to protect your rights, and prevent companies like National Attorney Collection Practices from taking advantage of you when the FTC’s not looking? Well, the first step is knowing what your rights are.Online consumer complaint service Scambook.com cites at least four main rights you have to protect yourself:

• Keep work and home separate: National Attorneys crossed a big red line when it tried to collect debts from consumers at their place of work. Tell debt collectors not to contact you at work — ever. 
• Let’s keep this between you and me: Even legitimate attempts to collect a debt are matters to be discussed between the lender and the debtor. If you find out that a debt collection agency has contacted your friends or family — or anyone else — about your debt, tell them to stop and then file a complaint. 
• You catch more flies, and fewer FTC lawsuits, with honey:What constitutes “harassment” is often going to be in the eye of the beholder, but Scambook says that once communication from a debt collector has risen to the level of harassment, it’s no longer kosher. Tell them to knock it off. 
• Support your local post office: Technology is a marvelous invention. But even so, debt collectors have no right to harass consumers over the phone and by text, by day and by night. If you are the subject of such harassment, tell them you want all future communication to be conducted by mail. This is a request they must honor. 

Also keep on the lookout for other instances where debt collectors are playing fast and loose with the rules. To name just a few violations, the FTC called out National Attorney for:

• Failing to disclose in the very first text message that the company was a debt collector trying to collect a debt. 
• Failing to provide details on the supposed debt the company was attempting to collect, and failing to inform the consumer of his or her right to dispute the debt’s validity. 
• Including statements on the outside of the envelopes on postal mailings, noting that the contents relate to an attempt to collect a debt. Because these envelopes could be seen by anyone, that’s a violation of the rule against informing third parties about a consumer’s debt situation — and it’s a no-no. 

Visit Dominion Lending Centres Mortgage Village to consult a mortgage professional.

3 Helpful Tips On Debt Consolidation

If your debts have become uncontrollable and you are serious to get out of this financial instability, you must go for debt consolidation. With the help of debt consolidation all your multiple unmanageable debts will be consolidated into a single debt. After consolidating your debts, you also do not need to face the hassle of paying off your creditors separately. All your various creditors are paid off with a single monthly payment that you make to your consolidation company. Thus, there are various benefits of consolidating your debts. However, you must be aware that in order to have a successful debt consolidation, you need to know certain tactics. This article provides you with some tips on debt consolidation that may help you out.

Debt Consolidation Tips

Here are some tips on debt consolidation you need to know before you go for consolidating your debts with the help of a debt consolidation company.

• Reputable company - Before you choose a debt consolidation company, make sure to have a thorough research on the debt consolidation company that you want to go for. Research well online about the company and find out if it is a reputable one. All debt consolidation programs are not equal. Shop thoroughly and this in turn will help you get the best deal that suits your needs. Investigate not only whether they are offering you a low fees or not but also how long the company has been in the business, their experience and reputation.

• Non-profit companies - Non-profit organization may offer you much lower fees but you must keep in mind that non-profit doesn't mean that they are eager to help you out with your financial situation. Some also make fake claims to be a non-profit company in order to attract you. Thus, you need to be cautious about them.

• All debts do not need consolidation - All debts are not similar and may not even need consolidation. Thus, do not unnecessarily consolidate them. Analyze each debt separately. You must read the terms and conditions for each of your debt carefully. Estimate the APR and total cost of loan with help of an online loan amortization calculator. If you find out that your existing unsecured debt is cheaper than the consolidation loan that is being provided to you, it is better to avoid consolidating it.

Apart from these tips mentioned above, you must also figure out the total cost of your debt consolidation loan. Securing a low interest rate provides you with the main benefit of consolidating. Thus, make sure to utilize these tips on debt consolidation if you want to secure a successful consolidation.

Visit Dominion Lending Centres Mortgage Village to consult a mortgage professional.

Canadian House Hunters, Weigh Your Mortgage Options

Before we move into our new house this summer we have a really big decision to make. Do we go with a fixed or a variable rate? The answer to this question varies for everyone depending on their financial situation and tolerance for risk.

According to a popular study by Moshe Milevsky, choosing a variable rate has saved home owners money nearly 90 percent of the time. Sounds like an easy decision then, right? Not exactly.

This Time it’s Different
Interest rates are still at historic lows, with most experts predicting that rates will increase at least 1-2 percent over the next two years. Five-year fixed rates are currently under 4 percent, which is definitely an attractive rate to lock into and protect against the risk of future interest rate hikes.

But if the math favors choosing a variable rate mortgage over time, why are people so divided on this issue?

The vast majority of Canadians still choose the five-year fixed term. Proponents of fixed interest rates enjoy the peace of mind knowing that their payments won’t change and they also feel that we are in one of those rare situations where locking into a five-year term will save home owners money.

Since variable rates are always initially cheaper than five-year fixed mortgage rates, the decision ultimately comes down to saving money now vs. the potential of saving money in the future if interest rates go up.

What Options To Consider?
Let’s take a look at some real numbers to help make our decision. These are the current interest rate options for us, along with some pros and cons to consider:

Five-year variable interest rate = 2.20 percent (prime minus 0.80 percent) – As I mentioned, this is likely the smart choice since the variable rate has saved money nearly 90% of the time vs. a fixed rate. However, this time could very well be different, and if interest rates climb quickly back to historic levels this can become a losing proposition.
Five-year fixed interest rate = 3.89 percent – All things considered, a five-year fixed term under 4 percent is extremely low and would give us the peace of mind knowing that our payments wouldn’t increase even if interest rates soared. On the downside, by choosing this option we would be paying $260 more per month than if we went with the variable rate.
Three-year fixed interest rate = 3.54 percent – This option would give us the flexibility of not locking into a five-year term and also benefiting from a 0.35 percent discount over the five-year term. The monthly payments would still be $200 more than the payments on the variable rate.
1 year fixed interest rate = 2.64 percent – This option might be the best for us if we feel this is still a period of uncertainty. We would maintain our negotiating power after just one year and we also benefit from a 1.25 percent discount off the five-year fixed rate. But if interest rates were to rise quickly over the next 12 months we would still have to renew our mortgage at a higher rate when it came due.
As you can see, the five-year fixed rate has a built-in premium of 1.69 percent over the best variable interest rate. If the Bank of Canada decided to raise interest rates fairly quickly and aggressively over the next few years, the five-year fixed rate would likely be the better option.

Economic Factors at Work
The Bank of Canada meets eight times a year to make interest rate announcements and historically will move the rate by 25 or 50 basis points (0.25 or 0.50 percentage points) at a time. There is definitely the potential for interest rates to move between 2 – 3% in a single year.

The problem is, we are not very good at predicting where interest rates are headed. When it comes to monetary policy, there are a lot of moving parts to consider. It’s not as simple as just trying to contain inflation or trying to prevent a housing bubble.

Think of the soaring Canadian dollar. If interest rates were to rise sharply, the loonie would continue to climb vs. the American dollar, which puts increasing pressure on our manufacturing sector that relies heavily on exports.

Interest rates are indeed at historic lows but, with the outlook of the world economy still very uncertain, it is likely that the Bank of Canada will continue to move cautiously to avoid triggering another recession.

The Affordability Factor
Ultimately, whatever we decide to choose will carry some risk. Often the fixed vs. variable interest rate question is more about affordability than anything. Can your budget handle a 2 percent – 3 percent hike in interest rates? If not, then the fixed rate gives you that peace of mind to know that your payments won’t change for five years. If you can handle an increase in mortgage payments then you might find a great opportunity to save thousands of dollars in interest over the life of your mortgage by choosing the variable rate.

In our case, I think we are leaning toward the five-year variable rate, but with a twist. We will set our payments as if we were paying a 4.5 percent interest rate. This way we will be knocking years off of the overall amortization of our mortgage while saving thousands of dollars of interest. And we will still have the peace of mind knowing that we have built in a 2.3 percent cushion into our monthly payments in case interest rates rise.

Visit Dominion Lending Centres Mortgage Village to consult a mortgage professional.

How Debt Consolidation Works

You see advertisements for it all the time — “Get debt-free and lower your monthly payments! Call now!” Debt consolidation ads are as ubiquitous as diet pill ads and sometimes just as outlandish.Despite the remarkable claims, debt consolidation isn’t magic and doesn’t really eliminate your debt (at least not immediately) because it involves getting new debt. That’s what debt consolidation is — taking out one new loan to pay off all your other loans. Still want to call now? Be warned: You may wind up in worse financial straits than you were before.

Dealing with student loans, car loans and mortgages, as well as any other debts is daunting. If you can pull all those expenses together under a lower interest rate, like many ads boast, you will end up making lower payments. In addition, the idea of lumping several payments into one might appeal to you. Indeed, with this process, you are far less likely to forget to pay a bill. It seems like a win-win situation.

But is it too good to be true? Yes and no. If you dive into a debt consolidation deal without reading the fine print, hidden fees can worsen your financial situation. You may even owe money for longer, and it might cost you more long term. However, when entered into cautiously, debt consolidation can help you get control of your finances.

It can be frustrating to wade through the decisions involved in debt consolidation. Several methods exist, including using a bank, a finance company or even credit card offers. Often, you can qualify for lower interest rates if you are willing to put up your home as collateral, but you risk losing your home if you cannot make payments.

In this article, you’ll find out about the different methods of debt consolidation, how to tell the bogus deals from the legitimate ones and how to combine those pesky student loans (or not). Read on to find out if you show some of the telltale signs of having too much debt.

Visit Dominion Lending Centres Mortgage Village to consult a mortgage professional.

Know What You Are Getting Into With This Info

People are looking to purchase real estate out there for many reasons. Whether you're attempting to find a home for your family or if you just want to make a profit by flipping a house, here are some great tips you can use for buying real estate. Focus on these tips, and learn about the market.

If you are purchasing a rental property with tenants, check their lease length and history. It is not unheard of for a person desperate to unload a property to find or hire short term renters to entice a buyer. Once the home is sold, you could be left scrambling to find new tenants.

To make money in real estate, location has always been the buzzword. But, you can make money now based on the replacement cost; many properties are selling for less the cost to build it new. You can buy property now by looking at the long term cost of carrying it.

If you're not finding an ideal home in your price range within desirable neighborhoods, considering fixer-uppers will open options for you. The neighborhood is such an important factor in being happy in your home, you may want to lower the standards of the house enough to make it affordable to stay in the better neighborhood. Fixing up a house is a great way to make it truly your home!

To get the best return on your real estate investment, always look at prospective properties through the eyes of the buyers you hope some day will purchase the home from you. A one-bedroom house is definitely cute and cozy, but you may find it difficult to sell later if located in a kid-friendly, suburban neighborhood that is filled with three-bedroom ranch homes.

To help you buy or sell real estate you have to find an agent that you are not personally involved with already. To hire a good friend or relative is setting up a potential disaster from the beginning. Not all agents work out with their client and there are ways to fire them. Imagine if it is your boss' wife or your aunt.

Learning some tips and tactics to use in the real estate market will ensure that you're always getting the best possible deal as a buyer. You never want to be left out in the cold on any deal. People are looking for ways to take advantage of you at every turn. Use the tips above and you'll do great.

Visit Dominion Lending Centres Mortgage Village to consult a mortgage professional.

What To Do When You're Buying Real Estate

Buying real estate is a huge decision and most often, is one of the weightiest financial commitments you can make. In order to get the best deals out of the real estate market and purchase property that will satisfy you without regret, you should take steps to educate yourself on the real estate buying process. This article contains a few tips to help.

Be realistic in your decision to buy real estate. The cost associated with real estate ownership goes far beyond mortgage payments. You must factor in insurance, taxes and the maintenance of the home itself when you calculate the impact on your income. If you know what you can afford on a yearly basis, you can budget your money accordingly.

When you are a buyer for a new home and in a bidding war with other people that want the same home remember that you may not have the time to really look the house over and get a good inspection on it. You must be prepared that if you get the home some things might have been looked over such as repairs that need to be made.

Use caution when buying a home that is on the short sale market. There are so many parties that are involved in this type of transaction that makes it easy for something to go wrong before you gain the deed to the home. Be prepared to lose the home that you think you may be winning at auction.

Coordinate with the seller for a professional inspector to visit the home to really look things over thoroughly. Make plans to meet your inspector at the home so you can accompany him through the entire procedure. It will help you to understand the results that are in the report better.

Before you buy real estate, you should spend some time in the neighborhoods the at you are interested in. Locals there are usually going to tell you more about what really happens in the area than a real estate agent who is working on a commission that they only get if the deal closes.

A piece of property that you decide to buy is going to be with you for a long time. Obviously, you will want to find out all you can about a property before purchasing it. In the same way, you should do everything you can to educate yourself about the real estate buying experience beforehand.

Visit Dominion Lending Centres Mortgage Village to consult a mortgage professional.

Get Smart And Follow These Tips On Buying Real Estate

The way the real estate market works might seem more simple than it sounds. You find a house you like, you put in an offer, and you move in if accepted. Nevertheless, from finding financing to locating the right inspector, there's so much more that goes into it. Here are some of the things you may not have known about purchasing real estate.

In order to buy a new home wisely, you should carefully inspect the property you wish to purchase. If you notice any problems, make note of them and discuss them with the seller. The more things you can get them to fix prior to the sale, the better. This will add value to the home and save you from costly repairs down the road.

If you're thinking about relocating, you may want to consider looking online at the neighborhood of the house you're thinking of purchasing. You can find a lot of information, even for the smallest cities. General demographics about the neighborhood, such as income levels and age distribution, can give you a good idea of what to expect if you were to move there.

Home buyers always need to consider how many bathrooms they need. The ideal is to have a bathroom for each bedroom plus a half bathroom near the living room for the guests. When the possibilities don't support the ideal floor plan, try to buy a house with at least two and a half bathrooms: one for the master bedroom, one for the other bedrooms and the half for the guests.

Things like these always seem so obvious in hindsight, yet you would be shocked at just how many homeowners are neglecting to use tips like these when purchasing homes and other types of properties out there. Don't become one of the many real estate losers out there. Use the tips above to come out ahead on any deal.

Visit Dominion Lending Centres Mortgage Village to consult a mortgage professional.

Learn The Best Move When Buying Real Estate

You've been looking all day for good tips on buying real estate but have found nothing of use so far. It can be frustrating with the amount of unverified information out there. Pay close attention to the tips provided in this article and you should find plenty of good information to help you on your way to being an expert on the subject.

Spend some time shopping for your home before you contact a realtor. If you have an idea of exactly what you are looking for and the correct price range, two to three times your yearly gross, it makes the job for your realtor much easier. Your realtor can then target specific homes that will make it on your short list.

When you have kids, or are planning to start a family in the future, make sure you buy a home that can accommodate everyone. Keep safety in mind, as well, particularly if a home has a swimming pool or stairs. A house in which children have been raised is probably a safe house.

Make sure that you get all of the closing documents ahead of time. Going into closing blind can lead to a very long meeting as well as oversights. Read the documents thoroughly ahead of time and ask any questions prior to closing. This will make for a much smoother transaction on the day you go in to sign.

If you have kids and are looking at buying a house, try to include your children during the search process. So much of their life will be changing with the move and by including them in the search you will make the transition a little bit easier. They will feel like they can have some sort of input in the change.

To save money on your real estate taxes, you should challenge the bill each time it comes out. Every taxing authority has a formal process to ask for them to reevaluate your property and many homeowners find that they are able to get the value down, simply by providing information about prices that other homes in the area have recently sold for.

Some buyers try to sell and buy properties at the same time, which can have a disastrous effect. Sell your old house before you buy the new one. Trying to coordinate the two sales is very hard, and if it is unsuccessful, you can be stuck with paying two mortgages at the same time

If you are shopping for real estate, don't give a low offer on a home you are very interested in buying. An extremely low offer will scare off the current owner and make it appear that you are not willing to negotiate. A more reasonable offer shows the owner that you are serious about buying it.

Searching for real estate can be overwhelming, luckily there are many sources available. Many real estate companies list available properties on their websites, which you can browse through at your leisure. If you are just curious and do not want to commit to a real estate agent, Craigslist and the local newspaper, are also great places to start.

In the beginning stages of home buying, you will want to get pre-qualified for a home mortgage loan. This is really a simple, but valuable process. To obtain this pre-approval, a mortgage lender will review your personal income, savings, and monthly out-of-pocket expenses. By reviewing these numbers, the lender can calculate how much you can finance and how much the monthly payments will be for the loan.

In conclusion, it can take a lot of time out of your day trying to find good information about buying real estate. This article has compiled some of the best information available. Follow what is mentioned carefully and you will be in great shape for whatever you were hoping to accomplish.