Back to Blog
As a mortgage advisor all of my clients want the best interest rates for their mortgage. Other than choosing a great mortgage professional - the best way to ensure you get the best mortgage rates is to maximize your credit score. Great credit history and credit scores look attractive to lenders and they will offer these clients the best possible interest rates.
Read my tips below on how to maximize your credit score. If you need free mortgage advice feel free to call me directly at 905-441-3991 Tim Deering The Mortgage Locator. Click Here for more info
Never Max Out Your Credit Limit
Credit utilization - Credit cards and lines of credit that carry balances over 50% of the available credit amount negatively impact your credit score. Try to always keep credit balances below the 50% mark. If you carry credit balances try and spread it out over different cards don't carry big balances on the same card or line of credit. Credit utilization accounts for approx 30% of your credit score.
Never Go Over Your Credit Limit
When you have credit cards or lines of credit that carry balances near the limit, you run the risk of going over your credit limit sometime this can happen accidentally because of an interest charge that you didn't factor in. Accident or not going over your credit limit will negatively impact your credit score and potentially get you in trouble with the credit issuer. Always leave some extra room. If your available credit is $5,000 never run it up over $4500. This should eliminate you ever going over the limit accidentally.
Always Accept Offers of Credit Limit Increases
Even if you don't need the extra credit always accept offers from the bank or credit card company to increase your credit limits. Higher credit limits make you look like a stronger candidate to lenders it will also boost your available credit amount, this will increase your credit utilization percentage that will in turn increase your credit score.
Use All of Your Credit Sources
Don't let your cards or lines of credit go stale. It's easy to have a favourite card or use a card that offers the best rewards. Use all your cards regularly. Try and use some portion of your available credit often and simply pay it off right away. Accounts that sit dormant for too long will negatively impact your credit score. Some lenders may even revoke or reduce your available credit amount.
Never Be Late With Your Payments
Paying credit cards, loans or lines of credit late are disastrous to your credit score. Late payments stay on your account for years and will look really bad to prospective lenders. Even one 30 day late payment will be a black mark on your credit profile and will haunt you long in to the future. Keep track of your payment cycles and always pay off your minimum payments or balances at least 7 days prior to the due date.
Check Your Own Credit Report on a Regular Basis
You should pull and monitor your own credit report at least twice per year. Not only will this help protect you from fraud or identity theft but it will also help you monitor your reports for errors. If you ever see any errors on your credit report contact the credit reporting agency right away and have it removed or corrected. In Canada the 2 main credit reporting agencies are Equifax and Trans Union I recommend you pull your own report on both agencies as the information may differ from either agency.
Remember if you want to get approved for a mortgage with an A lender and be offered the best mortgage rates. Look after your credit and monitor your credit reports. This way you will be prepared and you will not be surprised by unexpected questions that may pop up from lenders.
Mortgage agents can help you get approved even if your credit is not perfect. As a mortgage agent I deal with many different types of lenders that can help with all types of credit situations. I can also show you how to get your credit in shape before you apply to the lender for a mortgage.
My Name is Tim Deering, I am The Mortgage Locator. Call me direct at 905-441-3991 or
Click Here for more info.
Back to Blog
SOLD OVER ASKING: A buyer's nightmare and a seller's dream, maybe? What is going on with the real estate market in most Canadian cities? Bidding wars, multiple offers, all time record selling prices. Sounds great if you're selling, right? except most of still have to buy another place to live in the same market.
Bidding wars are not just happening in Toronto & Vancouver they are happening in many small and rural communities as well. With recent pandemic fears at an all-time high and people working from home. This combination is driving thousands of Canadians out to small town and rural neighbourhoods away from the big cities.
Speaking of the pandemic, when the pandemic hit last year in March, many economists predicted the housing market would be in big trouble. There was a slowdown for a couple of months, but overall their predictions never materialized. In fact, housing market numbers are up across the board. In the GTA single-family homes are approaching an average price of $1.5 million a 25% annual increase. Why? Many say the main reason is housing inventories are low and demand is high. Is the answer that simple?
Many experts are predicting a housing market correction by the 3rd quarter of 2021 but are not expecting it to last long and most are definitely not predicting a crash in the housing market this year. Now that vaccines are here and on the horizon there might be an end to the pandemic and a loosening of immigration restrictions combine this with a kick starting Canadian economy and these factors show an even stronger housing market.
Many hard-working Canadians simply can not afford to buy a home in the current housing market If we need new regulations we DON'T need regulations that will push Canadians further from home ownership such as higher minimum credit scores, lower maximums on debt service ratios or increasing the amount of min down payments required. People need homes to live in, and the above-mentioned measures will negatively affect regular blue-collar working people.
We need regulation to increase the foreign buyers tax, increase capitol gains tax on investors that buy simply to flip and investors that buy and simply leave the house vacant for months or years.
As a mortgage advisor, I feel the single most important policy change has to come from the Canadian Real Estate Association (CREA) They must regulate realtors to stop listing properties for $300k less than the value to encourage bidding wars. And stop them from holding offers for 5-7 days. This is driving the bidding frenzy and creating the multiple offer situation. This is not the normal process. In past years agents would list the price based on comparable sales and as a seller you would be happy to get the asking price. Because of these volatile market conditions, innocent people/buyers do not know what the house is worth and are told they need to bid high or they won't have any chance to get the house. They are also encouraged to waive all the conditions such as financing and home inspection. Waiving these conditions is a dangerous business for home buyers and ends in disaster for many people.
None of us should want policy change simply for the sake of change, and we don't want policy change that gives some even more of an advantage than they have now. In this Mortgage Agent's opinion I am for some regulation and policy changes, but only if it actually helps regular working people to get in to the market and make home ownership affordable for more people not less.
If you have any mortgage questions - It's my pleasure to help. Call me direct
Tim Deering - 905-441-3991 or email me at firstname.lastname@example.org
Back to Blog
What is a mortgage?