Personal Finance FAQ

By Caitlin in Money
Personal Finance FAQ

Debt, loans, credit and mortgages, it can all seem a little overwhelming even at the best of times so when things aren’t going your way your personal finances can become a nightmare. That’s why we wanted to answer your most frequently asked personal finances questions, so you can be better prepared to deal with any issues that arise.

Does Bankruptcy Lower my Credit Score?

Unfortunately the short answer here is yes, filing for bankruptcy will absolutely lower your credit score. Bankruptcy is a serious financial decision and should not be made lightly or without considering all other options. In certain cases bankruptcy is the only and best option, when this is the case it can be used to free someone from their debts.

Bankruptcy has the worst possible effect on your credit report and score. Once you’ve filed for bankruptcy and your debts have been discharged it will be extremely difficult to get new credit and rebuild your credit history. This is why bankruptcy should not be filed unless a professional has informed you that it is your only option.

How to Get a Mortgage Loan after Bankruptcy?

People often believe that filing for bankruptcy means that their lives are over and that they’ll never be able to regain the life they had before. This is obviously not the case and while it is more difficult to apply for and be approved for a mortgage after filing for bankruptcy it is not impossible.

Finding the right lender is our number one tip and it should also be your number one goal. The right lender who is willing to work with you will be the difference between getting a home and being rejected. Look for a private lender as an alternative to more traditional lending institutions like banks. These lenders typically work online and are willing to discuss your current financial situation in greater detail than a bank might want to.

If you are looking to further improve your creditworthiness you should start saving for a down payment right away, build your credit by responsibly using a credit card and make sure you continue to keep your debts to a minimum.

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Will a Consumer Proposal Pay Down Debt?

Consumer proposals are an effective financial tool used to manage serious debt issues. Consumer proposals are unlike bankruptcy insofar as you’ll still have to pay back a portion of your debts. When you decide to file a consumer proposal you’ll work with a bankruptcy trustee who will then get in contact with your creditor. Your trustee will negotiate on your behalf with your creditors in order to reduce your debts. Once the negotiations are complete you’ll make one affordable monthly payment to your trustee who will then distribute it to your creditors.

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What is the Best Bad Credit Loan Company?

Choosing the best lender for your current financial situation is one of the first and most important steps you can take during the loan application process. Answering this question is not easy as everyone’s loan needs are different, but if you’re currently looking for loan company to work with regardless of your financial standing here are a few things to remember:

  • Always shop around for the best rates and the best customer services
  • If an offer you’ve received seem too good to be true, it probably is
  • Don’t fall for a predatory payday lender
  • Only work with a lender who you are completely comfortable with

There are lots of great private lenders who are willing to work with people who have less than great credit so do some research and we’re sure you’ll find a great fit.

How to Get a Private Mortgage?

The best way to get a private mortgage is to look for a private lender, either online or through a recommendation, who you want to work with and that is willing to work with you. Once you’ve chosen a private lender you’ll have to fill out their application and go through their loan approval process. Most loan applications are approximately the same but depending on the company you go with, there could be slight differences.

Private mortgages are great options for people who have continually been rejected by more traditional lending institutions or who simply wish to work more closely with their lender.

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How do I Rebuild my Credit?

Rebuilding your credit is hard work but it can be done and thousands of Canadians do it every year. Generally speaking, to rebuild your credit you must get credit and then proceed to use it responsibly and over time you will start to see your credit grow and improve. To jump start their credit most people like to use a credit card, if used properly a credit card will allow you to prove that you can responsibly handle credit while simultaneously building a credit history and score for yourself.

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