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Amy Wilson
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"Mortgage Options...Not Restrictions!"
"Mortgage Options...Not Restrictions!"

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5 Tips on how to get out of debt and into your own home


To get out of debt, you need a plan and you need to execute that plan. That’s why I’ve created this simple, five-step, get-out-of-debt checklist that can help you leave that financial burden behind you.

As you work on your plan, you’ll need to make all necessary adjustments to your budget along the way so you don’t overspend and slide back into debt. Plus, if you don’t have an emergency fund, consider setting some money aside in savings beforehand.

Keep this checklist someplace where you’ll see it often (like your refrigerator door ), and make it your goal to check a task off the list each day (or each week), depending on how quickly you want to become debt-free.

1- Make a list
Take all your bills and put them in a chart that includes: the name of creditor, interest rate, balance, minimum monthly payment. Figure out how long it will take you to pay the balance down to zero. Many credit card statements now feature this.

2. Lower your rates
This is easier than you think. Call up each of your credit card companies starting with the ones with the highest interest rates and ASK them to lower your interest rate. You can tell them that other credit cards are offering lower rates and you wanted to let them keep your business. They won’t give you an answer on the phone but you should receive a letter with a new lower rate within a couple of weeks. Another possible solution is a balance transfer. Often a credit card company will allow you to transfer your balance from another card to theirs and they charge you 0% for 6 months. They assume that you will see zero being added and will spend more. Show them that you are disciplined and keep paying the balance down as if it was still at 19%. Consider getting a debt consolidation loan. If you have a home with equity you can often get a very good rate and clear up all your debts. Often you can get these loans at considerably less than your credit cards. Once again, keep your monthly payments up as if you were still paying a credit card of 19% interest and your balance will go down quickly.
Next contact your car loan company. If you have been paying your loan on time they may lower your rates. Now you are ready to tackle the utility companies. In Alberta the gas/electric companies really want your business. You can often get a better rate just by threatening to switch. This also works with cellphone companies. They often have better plans than the one you are on but will only offer it when you say you are going to leave.

3. Get your Number
What is the amount you need to pay off all your debts? Now that you have a number in mind you can set a goal. Can you pay this off in six months? 12 months? two years?
Get your credit score number. How much does it have to improve before you can qualify to buy a house? Check with your Dominion Lending Centres mortgage broker for help getting this.

4. Make a plan
What will be your target debt? Is it the credit card balance with the highest interest rate? The lowest balance? Set a short term goal to pay one card off in a manageable amount of time. One down and three to go sounds better than tackling all the debt at once. Pay each debt off one by one. Does your community library offer debt counselling financing planning courses? Consider signing up for one.

5 – Monitor your progress
How quickly are the debts coming down? Is your credit score going up? It should if the debts are coming down.
Do you have to adjust your plan to make your deadlines? Don’t be discouraged. Large companies make plans and set budgets and then adjust them quarterly based on how the previous three months performance was.
Stick with your plan and if you show some self-discipline you can achieve your goals in time.

Finally, tell your local Dominion Lending Centres mortgage broker what your goal is and what your timeline is. I am happy to help you along the way.

Amy Wilson
amy@yourmortgagegrl.ca
780-919-0475
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Below is a scenario I just went through with a client of mine.  Please keep in mind every person has a different mortgage situation and it is important that your mortgage experience is tailored to you and your needs.  See below on how I took my client throu...
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What To Expect During The Mortgage Process
Happy Friday everyone! Please find below my next video blog. This time I
am talking about what to expect during the mortgage process. Feel free
to contact me should you have any further questions. ‪#‎ mortgages‬ ‪#‎ amywilson‬ ‪#‎ firsttimehomebuyers‬ htt...
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Bank of Canada Has Left The Key Interest Rate Unchanged
Bank of Canada is leaving the key interest rate unchanged.  Stephen Poloz and his colleagues decided that it is in the best interest of the country to leave the overnight rate at 0.5%.  The Prime rate will remain at 2.70% as well. Please click here to read ...
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Mortgage Rates
Attention Rate Shoppers!!   Most of the clients I get a phone call or email from are so focused on rates that they lose site of the other mortgage details: The reality is, the mortgage rate is a just one piece to the mortgage process.  Rate is very importan...
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Mortgage Down Payment Issues?
First Time Home Buyer?  Having trouble coming up with your down payment?   Here is a solution!! ATB and RBC will lend up to $25,000 over 10 years to invest in an RRSP.  TD will only lend over 5 years. Scotia will give you an RRSP loan line of credit but we ...
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"Do it your self garage" or "builder garage"?
Good Morning, I had a wonderful conversation this morning with a client of mine that purchased a brand new home 3 months ago.   She gave me some excellent feedback that I will share here and pass on to all my home builder contacts so we can help future home...
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