Tag: Credit

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A GREAT CREDIT SCORE DOESN’T MEAN YOU WILL GET THAT LOAN

A GREAT CREDIT SCORE DOESN’T MEAN YOU WILL GET THAT LOANCredit score. If you’re not concerned about your credit score, you should be. Our lives revolve around our ability to access credit – car loans or leases, co-signing a loan for others, mortgages, rental agreements, lines of credit, credit card. In addition to affecting our ability to borrow, credit scores can impact our insurance rates and even our love lives.

What is a Credit Score? According to TransUnion, one of Canada’s largest credit reporting agencies, “A credit score is a statistically derived prediction of an individual’s credit risk at a particular point in time. Credit risk is typically defined as the likelihood of an individual becoming seriously delinquent (i.e. 3 payments past due or worse) within a 12-24 month period in the future). The score is a three-digit number that lenders use to help them make decisions. A higher score indicates that the individual is a better credit risk to a lender”.

I have always advocated to clients that having a good credit score is more of a risk/reward indicator for lenders as opposed to a true measure of “credit responsibility”. Credit scores don’t really evaluate credit worthiness, but instead whether a company can make a profit from the person. The good credit score they are looking for is in a range where you don’t pay things on time, but you eventually pay. That way they can charge interest, but feel comfortable that ultimately you will pay them in full. If you pay all your bills off in full and on time every month your credit score may indicate to the credit card issuer or lender that they may not be able to earn enough profit from you and therefore your credit score may not be as good as someone who carries a balance and pays the minimum every month. Although it may sound counterintuitive, having a great credit score doesn’t necessarily mean you’ll get that loan. However, it goes without saying that if you have a very poor credit score, then with certainty we can say that you will not obtain the approval of your banker. Unfortunately, there is not an online tool such as a Canadian credit score calculator.

If you’re having credit problems, it may be indicative of serious debt issues. Contact Ira Smith Trustee & Receiver Inc. today. Starting Over, Starting Now we can help you deal with your debt issues and restore you to financial health.

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Brandon Blog Post

REDUCE DEBT: 5 NEW YEAR’S RESOLUTIONS TO REDUCE DEBT IN 2014

REDUCE DEBT: 5 NEW YEAR’S RESOLUTIONS TO REDUCE DEBT IN 2014Reduce debt now to have a Happy New Year! This is the time of year that we vow to take charge of our lives and get healthy, lose weight, join a gym, find love, get a new job…. I’d like you to expand your thinking to include your “financial health” and reduce debt. According to RBC, Canadians are getting deeper in debt – non-mortgage debt in Canada jumped 21% in the past year alone to $15,920 per capita. Don’t become a statistic. Here are 5 New Year’s Resolutions to reduce debt in 2014.

1) I will live within my means: With interest rates low, you may be lured into taking advantage of what you perceive as a great deal. Borrowing, even with low interest rates, is only a good deal if you can afford to make the payments. There are many multimillion dollar houses in foreclosure and many repossessed luxury cars. Buy what you can afford. You can reduce debt this way.

2) I will create a budget and stick to it: A budget can be your best friend. RBC reports that Canadians’ total debt burdens, including mortgages, now stand at 163% of household income, or $1.63 owed for every $1 earned. This is a recipe for financial disaster. A budget will show you what your income is and what you can really afford. You may have to go a strict spending diet in order to get your finances back under control and reduce debt.

3) I will not max out my credit cards: It’s easy for spending to get out of control when you’re using credit cards. Spending takes on a whole new meaning when you actually use money to pay for things. If you want to buy something, pay for it with cash. Keep those credit cards out of sight for day to day spending and use them for emergencies only. This will allow you to reduce debt.

4) I will monitor my credit report. As we discussed in a recent blog – YOUR CREDIT RATING CAN BE RUINED EVEN IF YOU DON’T DO ANYTHING WRONG – it’s very important that you monitor your credit report and take immediate action if there are any errors. Don’t wait until your credit rating is ruined and you no longer have the ability to borrow.

5) I will start an emergency fund: I know that you’re going to say that you can’t afford to save; but telling you that you can’t afford not to save. Do you really need the expensive lattes and cappuccinos every day? Sell the stuff sitting in your garage or basement collecting dust. One man’s junk is another man’s treasure. See if you can negotiate a better deal on your cable TV package or cell phone plan. Can you cut out a few restaurant dinners and cook at home instead? All of these little things will help you establish your emergency fund while you reduce debt. And, remember, this money is for emergencies, not an all inclusive get away to Mexico.

If you’re experiencing serious debt issues, take control of your life and contact Ira Smith Trustee & Receiver Inc. today. Starting Over, Starting Now there is a way out of debt. Let us show you how. Let’s all make 2014 a great year and a year where you reduce debt!

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Brandon Blog Post

Everything You Wanted to Know About Credit Scores But Were Afraid to Ask

everything you wanted to know about credit scores but were afraid to ask, credit, credit scores, credit score, credit report, credit reporting agencies, problems with credit, toronto, bankruptcy, vaughan bankruptcy
everything you wanted to know about credit scores but were afraid to ask

Everything you wanted to know about credit scores but were afraid to ask: Introduction

Credit may not be sexy but it does make the world go ‘round. That is why it is important for you to know everything you wanted to know about credit scores but were afraid to ask.

Everything you wanted to know about credit scores but were afraid to ask: Our lives revolve around credit

Our lives revolve around credit – mortgages, car loans, student loans, credit cards…. Take out your wallet and look inside; how many credit cards do you have? According to a poll conducted on behalf of Credit Canada:

  • 43% of Canadians have more than 3 credit cards
  • 80% of Canadians do not know their credit score
  • 63% of Canadians do not know how their credit score is determined

The more you understand about credit the less likely you are to get yourself into trouble.

Everything you wanted to know about credit scores but were afraid to ask: What is a credit score?

A credit score indicates the risk you represent to lenders compared to other consumers. In Canada we have two credit reporting agencies – Equifax and TransUnion. They use a scale from 300 – 900 to rate your credit score. The number is calculated using a mathematical formula based on the information in your credit report (has detailed information on a person’s credit history including identifying information, credit accounts and loans, bankruptcies and late payments, and recent credit inquiries). You get points if lenders believe that you use credit responsibly. Conversely you lose points if you manage credit poorly. The higher your number is the better. A high number means that you are a good risk for credit. There are many factors that figure your credit score:

  • Length of time you’ve had credit
  • The types of credit that you use
  • Do you pay your bills on time?
  • How much debt are your carrying?
  • How many people have inquired about your credit?
  • Have you been bankrupt before?

Everything you wanted to know about credit scores but were afraid to ask: Why is my credit score important?

At some point in your life you will want access to credit whether it’s for a credit card or to borrow money to buy a house or a car, or to start a business. If you have a high credit score, you may be able to get a lower interest rate on loans, which can save you a lot of money over time. A good credit score will allow you to meet your goals for the future.

If you’re experiencing problems with credit, contact Ira Smith Trustee & Receiver Inc. We can help you get your life back on track Starting Over, Starting Now.

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Brandon Blog Post

When you have Debt problems contact a licensed Trustee

Bankruptcy, Consumer Proposal, Credit, Debt, debt settlement, Federal regulations, licensed trusteeIf you’re experiencing serious debt problems you are no doubt going through a very stressful time in your life and you may not know where to turn. Ira Smith Trustee & Receiver Inc. is here to tell you that there is help available and there are solutions to your debt problems. The best thing that you can do is contact a Licensed Trustee as soon as possible. There is a popular misconception that Licensed Trustees only deal with bankruptcy, but that is only one of our many functions. We can and do help with debt problems.

In a world of uncertainty filled with companies making promises that they can’t keep, a Licensed Trustee stands for trust, honesty, transparency, and integrity. We are federally licensed and federally regulated. Licensed Trustees are subject to a stringent code of ethics and we complete ongoing mandatory professional development each year. You’ll never get ripped off because our fees are regulated by the Federal Government unlike the non-regulated, unlicensed companies that make outlandish claims, charge exorbitant fees and often leave you in worse shape than you started from.

There are many great advantages to working with a Licensed Trustee. We:

  • Are required to perform an assessment
  • Review and counsel you on available alternatives
  • Ensure that your rights are not abused
  • Ensure that you are provided with mandatory counselling and access to mediation services if there is a dispute regarding any income you are required to contribute
  • Have the flexibility within the parameters of the legislation to develop a settlement solution that if fair to both sides; there is no one size fits all solution
  • Don’t just throw a number at you to pay whether or not you can afford it
  • Can assist you to make a single offer to negotiate with all of your creditors

Contact Ira Smith Trustee & Receiver Inc. for a free consultation today. We can help you with your debt problems. Starting Over, Starting now you can live a debt free life.

 

 

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Brandon Blog Post

Beware Of Debt Settlement Companies – Read this blog to find out why

Bankruptcy, Consumer Proposal, Credit, Debt, debt settlement companiesYou may have noticed that every time you turn on the radio or television there is another advertisement for a debt settlement company making outlandish claims about how they can solve your debt problems with a quick fix for pennies on the dollar. There is a very good reason that Canadians are now being inundated with these ads – the U.S. Federal Trade Commission effectively shut down debt settlement companies across the United States. Now the only place for debt settlement companies to troll for victims is in Canada.

“There is evidence of harmful practices used by some debt settlement companies and that is why our government is taking steps to protect consumers. We want to put a stop to abusive practices in the marketplace. Consumers should know their rights before they sign contracts and they should make no payments until they get results.” Margarett Best, Minister of Consumer Services.

There are over 20 debt settlement companies operating in Ontario and the Ontario Association of Credit Counselling Services receives over 100 complaints about debt settlement companies a month. Finally the Ontario government is responding to this very serious issue and is taking steps to regulate debt settlement companies. Alberta, Manitoba and Nova Scotia have already introduced regulations to crack down on them.

When something appears too good be true it usually is; and in the case of debt settlement companies their promises are always too good to be true. There is no instant or quick fix for serious debt issues. “Essentially, debt settlement companies have charged huge fees, sometimes in the thousands, made broken promises to settle debts for consumers and not followed through on their claims to be able to work with creditors,” wrote Laurie Campbell, CEO of the not-for-profit charity, Credit Canada Debt Solutions (CCDS) in a recent blog.

Beware of debt settlement companies that say:

  • Their program is government approved. Not true; the government doesn’t approve debt settlement programs.
  • They can stop collection calls and negotiate debt settlements. Not true; there is no legal protection for you if you choose to deal with a debt settlement company.
  • They will negotiate with your creditors for pennies on the dollar. Not true; there is no guarantee that your creditors will negotiate with the debt settlement company, especially for pennies on the dollar. You may very well end up in a much worse position than where you started off from.

What can you do when you have debt issues to contend with? Deal with professionals. Contact Ira Smith Trustee & Receiver Inc. for sound, professional advice. We are federally regulated and licensed and subject to a strict code of ethics. Our fees are regulated by the Federal Government and are usually much less than the debt settlement companies who make unsubstantiated claims.

 

 

 

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