Finance Tips

Working to obtain a short sale approval will depend on a number of factors, though chances are better these days of getting one than in the past. This is mainly because there are a lot of mortgage holders such as banks and credit unions who are sitting on millions of dollars of housing inventory that have been previously foreclosed upon and they generally don’t want even more.

For those not completely up on the terminology, a short sale is a method whereby a homeowner, who owes more on the mortgage than his home is now worth, can put the house on the market with the expectation of setting the sale price low enough to attract a ready, willing and able buyer in a relatively short amount of time.

Many times, short sale homes are priced at well below what is owed, and a bank or credit union or the like will allow it in order to ensure they at least get something rather than almost nothing, which is what would occur if the home were to be foreclosed upon.

It’s always wise to remember that the financial institution holding the mortgage must agree to a short sale, though, before the home can be put up for sale.

If considering a short sale as a way to avoid the much harsher foreclosure route – and preserve a better credit history than would be the case with foreclosure – it’ll be necessary to convince the bank that such a transaction would be in its best interest. As was said in the opening paragraph, many banks realize this almost without having to be told, these days.

In order to make the best case, it’s smart to obtain a new appraisal of the home, which will have to be paid for up front, generally. Depending on the region of the country, and the size of the property, appraisals can run several hundred dollars.

Expect from 200 to 400 dollars as the norm. The appraiser will look at similar properties in the area – along with other factors – and come back with an estimate of worth of the home.

With the new appraisal in hand, contact the bank and ask to speak with the manager or person in charge who services current mortgages and explain the situation, along with the request to conduct a short sale. Depending on circumstances, approval may come back quite quickly or it may take some convincing. If a bank has a lot of foreclosed homes already in its inventory, there should be little resistance.

Sometimes, it can be a little difficult to actually contact the department that has responsibility for the mortgage and the contact number may be for a business that just services the instrument but doesn’t actually hold the mortgage itself. Be persistent and polite, though, and work through the maze until the right people are spoken to and short sale approval is obtained.

In these economically trying times, many people are just throwing up their hands and “walking away” from their mortgages, but this may not be the smartest thing to do, especially if maintaining a chance to get another mortgage down the road is important. That’s why a short sale that results in a speedy transaction may be the way to go.

Searchin’ .. and Searchin.. for franchise finance in Canada ? The reality is that it’s available, and we will share some common sense approaches to successfully financing a franchise in Canada.

Although you may have spent a significant amount of time in picking what you feel is the right franchise finance opportunity the reality is that we are hoping that you have spent, or will devote an equal amount of time to the financing of the purchase. Securing funding in any specialized field is clearly a challenge so working with an expert in the field is always advisable. This is no time to be a rookie when it comes to the successful financing of your business.

Many franchisees without any type of finance background might assume that traditional finance is available through institutions such as banks and credit unions. The answer to this assumption is actually no… And yes. Let’s explain. We are not aware of any Canadian bank that will set up a specialized term loan for the full financing of your business. (This might happen if you have significant outside collateral, guarantors, pristine credit, etc – but generally no). But, the reality is that the banks in fact do indeed do most of the franchise finance in Canada – but it’s done under specialized program called the CSBF/BIL program.

This should be your first point of call in financing your business. However, here’s where the ‘ expert’ advice is needed, as the program only covers the financing of certain aspects of the business, and you will need to cover off portions of your purchased that wont be financing through this program . This would be things such as ongoing working capital, the franchisee fee itself, etc.

It’s probably commons sense but aligning yourself with a franchisor that has a good brand and reputation and a successful share of their industry’s marketplace is in fact going to make financing a franchise in your case probably easier.

What category are you in? we ask clients . What we mean by that is that you might be opening a brand new franchise, or alternatively purchasing a business that is already a franchise and the existing owner wants to sell. There are advantages and disadvantages to both strategies, and there is certainly no cut and dry answer around what established or new business might be best for you. A quick example – it might be sometimes ‘ easier’ to finance an existing franchise that is being sold because the assets and cash flow and profits are more realistically able to be demonstrated.

In certain cases some franchisees might want to expand their business via additional capital – that also requires a specialized focus.

In summary the key elements of financing a franchise in Canada revolved around your ability to source and successfully complete financing that suits your purchase. This involves your own investment, known as the ‘ owner equity ‘ a well as the financing through programs such as the BIL program. Financing specific hard assets and complementing the overall finance package with a working capital term loan or operating facility will also get you tot he goal line.

Pick your franchise carefully, and seek a trusted, credible and experienced Canadian business financing advisor who can help you structure the proper finance package that suites your overall acquisition and growth needs.

The average person juggles numerous bills each month–credit cards, auto loans, personal loans and more! If you’re getting buried beneath paperwork, you may want to consider a debt consolidation loan. Instead of dealing with multiple creditors, you’ll only have to pay one bill each month. And you can get a debt consolidation loan–even if your credit is not-so-perfect–if you secure it with some type of collateral. Here’s how to get approved:

1. Decide on your collateral

Whatever item you choose as collateral for your loan should be one you’re willing to risk, since the lender could take it if you can’t make your monthly payments. One of the least expensive options would be your home, since you could get a home equity loan, a home equity line of credit or a second mortgage. If you’re not willing to risk your house, you could also use an automobile or a boat. Some lenders will accept stocks or bonds, or even expensive belongings such as jewelry or electronics.

2. Find a lender

You’ll need to find a lender that accepts the type of collateral you’re using to secure your loan. Most major lenders and banks offer home equity loans, and many offer personal loans secured with a vehicle or boat. You may have to dig a little deeper to find a lender that will accept jewelry or other belongings as collateral. Check with your local banks and credit unions, and do a search online to find an appropriate lender.

3. Compare loan rates and terms

Before you sign up with any lender, make sure you compare their rates and terms with similar loans. Some unscrupulous predatory lenders may try to take advantage of your situation by charging you a high interest rate or extra fees. It’s always best to compare at least two loans to ensure that you’re getting the best possible rate.

Try using one of ABC Loan Guide’s Recommended Lenders For A Secured Debt Consolidation Loan.

Secured Debt Consolidation Loans are possible even for those with less-than-perfect credit. By using an expensive item you already own–house, car, boat, jewelry–as collateral, you become less risky as a borrower, making it more likely that you’ll get approved for a loan.

CUNA Life Insurance Company is a division of the CUNA Mutual Group, which offers a variety of financial and insurance services to credit unions and to individuals. The CUNA Mutual Group currently holds about 15.26 billion in assets and employs around 5,500 members. The life insurance division of the company offers two types of insurance- Whole Life and Term. All policies are underwritten by CUNA Mutual Insurance Society which is a Fortune 100 company and has received an AA- rating for claims paying ability.

CUNA Whole Life Insurance

If you are a member of the CUNA Mutual Group, you and your spouse can qualify for life insurance without the hassle getting a physical exam during the application process. Other advantages are that your benefit amounts are guaranteed to remain the same as are your premium payments; the death benefits are tax free; and a member spouse can purchase a policy even if the member doesn’t have one.

A life insurance policy with CUNA provides your family with long term financial security. As with all permanent life insurance policies cash value accumulates as you remit premium payments. As a policy holder, you have the ability to borrow against the buildup in your cash value should the need ever arise. CUNA life insurance does not require the insured or the beneficiary to pay back the loan. If the insured member dies the benefit payment would be reduced by the loan value, or in the event that you cashed in your policy, the loan amount would just be subtracted from your payout.

CUNA Supplemental Benefits

CUNA Life Insurance Company also offers a wide selection of supplemental benefits that you can purchase along with your main life insurance policy. Their waver of premium benefit must be purchased before the insured reaches sixty. It will provide a waiver of any premiums due (until age 100) if the insured is totally disabled before the age of sixty. If the insured is totally disabled after the age of sixty, it will provide a waiver of benefits until the insured reaches the age of sixty-five.

CUNA’s accidental death benefit rider allows an additional payout if the insured dies from an accidental bodily injury. The amounts vary in accordance with the age of the insured and will max out at 150,000. This rider is not available for any insured over the age of seventy.

The guaranteed insurability rider offered by CUNA provides that the insured will be eligible to purchase additional insurance benefits on specified anniversary dates, without providing proof of insurability up to the age of thirty-seven. To exercise the benefits provided by this option the insured must have also purchased a waiver of premium rider.

CUNA life insurance’s children’s rider insures the lives of the policy holder’s children up to the age of twenty-three. To obtain this rider the parent cannot be over the age of fifty, and the covered child cannot have reached the age of seventeen. The maximum benefit payable under this rider would be ten thousand dollars. When the insured child reaches the age of 23 the rider will convert to a permanent life insurance policy and no proof of insurability will be required by the child. In the event that the parent dies before the child reaches the age of 23, then the rider will convert to a paid in full term policy that will remain in effect until the child reaches the age of 23.

Unlike their term insurance offerings, CUNA’s whole life insurance will cover you until you reach the age of 100. At this point the entire face amount of the policy would be paid to the insured. Death benefits are paid to the named beneficiary in the event of the insured’s death. Your premium amounts will remain level for the policy’s lifetime. If at any time you want to review the terms and conditions of the life insurance policy you can call their toll free number and a one page summary will be mailed to you. CUNA also makes changing your beneficiary a simple task, all you have to do is call their customer service number and request a form.

CUNA Term Life Insurance

CUNA also provides term insurance to cover your family for a specified period of time only. There is no accumulation of cash value, however all death benefits are tax free. CUNA’s term insurance is designed to offer protection of your family’s assets at the various stages of your life. These policies are usually purchased during the times that children are in college, when new mortgages are assumed, or during any time when your family faces a large amount of debt in the event of your death.

CUNA offers term policies in for level premium terms of 10, 15, 20 or 30 years. Level premium means that your premiums will remain the same for the life of the policy. The minimum amount of coverage available is 25,000 and the maximum amount is one million. CUNA will allow these policies to convert over to permanent life insurance policies as long as the conversion is done before the end of the term or before the insured reaches the age of seventy.

There are two riders that can be purchased with your level term insurance. The first is their other insured rider, which allows you to insured up to 9 other people under your policy with no additional policy fee being charged. The next is the waiver of premium rider which will waive premium payments for the remainder of the term if the insured is total disabled and has not reached the age of sixty. If the insured has reached the age of sixty, then the premium amounts will be waived until the insured reaches the age of sixty-five.

CUNA Life Insurance offers its members strong financial backing for its wide variety of life insurance policy options. You can rest assured that in the event of your death your family is well provided for.

It’s easy to get the terms credit & debt confused. They seem to be interchangeable, however they are two different words with two different meanings.

Definition of Credit

Credit is a financial tool that people seek to acquire from financial institutions. Canadian Banks, credit unions, credit card companies all offer credit to their customers in Canada.

I call credit the “before” part of the equation. You have to have credit before you have debt.

Credit offers come in many different forms.
Mortgages and 2nd mortgages Car loans Payday loans Credit cards Lines of credit There a many other types of credit which I won’t list here

Here’s where people get confused about Credit / Debt.

There are two types of credit available.

Fixed loans Revolving credit

Mortgages and car loans are fix payment loans Lines of credit and credit cards are revolving credit.

Canadian Mortgages and car loans are only credit that are available to you. That means that once you acquire a mortgage or car loan it becomes a debt to you. A mortgage or car loan is never credit to you.

HERE’S WHY:

Where you ‘re shopping for a $250,000 mortgage, you’re looking for credit to buy your new house. You’re shopping for credit at this point.

When you visit your local banker or mortgage broker in Canada you’re doing the following:

Asking the creditors to give you some credit. You’re applying for credit You need to be a approved for credit. Creditors check out your credit worthiness, credit score, credit reports etc.

These are all the activities you do BEFORE you get the credit that you’re requesting.
Credit cards and lines of credit on the other hand can be BOTH credit and debt.

HERE’S WHY

Let’s say you have a credit card with a $5000 limit. At the beginning you have $5000 worth of credit available to you. After a while of using your credit card, you use up $1,000 worth of credit available. That $1,000 of used credit now becomes debt.

BEFORE: $5,000 credit available

AFTER: $4,000 credit still available $1,000 debt owing

This is probably why people in Canada get the terms credit & debt confused. People don’t usually need credit counselling, they need debt counselling. They counselling after they’ve acquired too much debt. ( I guess people could use credit counselling which would help them learn about how they can wisely use their credit that is still available. )

YOU NEVER HAVE TO MAKE PAYMENTS ON CREDIT!!

As I always like to say, “you NEVER have to make payments on your credit available. Credit available DOESN’T ruin marriages. The creditors DON’T make any money on credit available.

You do have to make payments on outstanding debts, or debt that you’ve incurred. Too much debt does ruin marriages, and Canadian creditors love it when you’re indebted to them. That is how they make their money.

Credit / Debt? Debt / Credit?

There is alot of credit available to consumers in Canada. It’s big business. The problem is when Canadians take on too much of that credit which becomes their debt burden.

I hope that this post helps you better understand the difference between credit & debt and how these terms affect your personal finances.