Let Someone Else Pay your (Second) Mortgage

The concept of building your wealth through rental properties is simple because they pay for themselves. You purchase and manage the property but your tenants actually pay for the properties and  whatever extra is profit for you. It's hard to resist because it's such an easy concept. Aside from any profit gained in charging your tenants more than the property costs you, there is another advantage for you. While your tenants occupy the property, its value continues to grow and you reap the benefits of the increased property value. That's where the big payoff lies. Your expenses are in any property repairs or upkeep that may arise from time to time. Most small items can be and will be taken care of by your tenants. The biggest component of running rental properties, to give you maximum profit from the least amount of hassle, is finding the right tenants. Dealing with tenants who do not pay or cause property damage can be issues that you'll have to deal with occasionally. The less you have to spend time and money on bad tenants, the more money you'll make. Long term tenants are the best choice. They have a commitment to the property and will consider it their home, not just a house they're renting. Another factor to consider is the type of home you purchase to rent. Cheap properties are tempting to acquire immediately because they require fewer dollars from you. However, middle and upper-class properties will require less maintenance and their values will appreciate better than cheaper homes, giving you a bigger payoff when you decide to sell. For more information on how you can invest in real estate contact David Cooke - 403-836-1201 or visit http://davidcooke.ca

 

Understanding yoru Credit Report

Understanding Your Credit Report

As credit has become more and more abundant in our society, your credit report, and thus your credit rating, has become more important in your daily life. Your credit rating affects all aspects of your financial activities when it comes to borrowing money. Your credit rating also has the ability to affect the job you get, the apartment you rent, and even the ability to open a bank account.
Your credit report itself is simply a listing of all of your mortgage and consumer debt. Here in Canada, the two main credit reporting agencies are Trans Union and Equifax. Both agencies have a credit history file on anyone who has ever borrowed money. Every time you borrow money, or make a payment on a loan or credit card, the lender then reports the information about the transaction to these two agencies. In addition to credit information, you will also find liens and judgments on your credit report as well as your address and possibly your work history. The accumulation of all of this information is called your credit report.
The information on your credit report varies based on your creditors and what they have reported about you. Potential lenders and others, such as employers, view your credit history as a reflection of your character. Whether we like it or not, our financial habits have a lot to say about the way in which we choose to live our lives.
The credit score, or beacon score, is a number which gives mortgage lenders an idea of your lending risk.
Credit scores range from 300 to 900, the higher your credit score the better. The mortgage products and interest rate that you will qualify for are often determined by your credit score.
One thing that many people do not know is that you have the legal right to obtain a copy of your credit report. A mortgage professional can help you obtain a copy of this report and go through it with you to verify that all of the information is true and correct.
The good news is that your credit report is a working document. This means that you have the ability over time, to repair any damaged credit and increase your credit score.

Did you know that a mortgage broker can help you improve your credit rating and get you the financing you need for a home?  

Contact me for more information. 

Tax Breaks for new home buyers

Well, it 's that time of year when we are doing our taxes. As you look for all your receipts and fill out your tax forms here's one tax credit you may qualify for.
 Did you buy a house in 2012? If so you may be eligible for a $750 tax credit. Check the CRA website to see if you qualify.
  Do you live in Calgary, Airdrie or Okotoks? Replacing your present toilet with a water reduction unit could get you up to $150 back from your municipality. This could pay for the toilet and then the water savings would all go directly into your pocket.
   Are you trying to save for a house? You will need a 5% down payment.  Did you know that you could use your RRSP's as part of your down payment.? Here's the strategy. Buy RRSPs and get a tax credit. Hold them for at least 91 days and then you can cash them out to use for the down payment.
  Note that you have to fill out forms at your bank or credit union to show that you will be paying these RRSP's back over the next 15 years to avoid having to pay income tax on the money you receive.
   This strategy can get you into a home now, while interest rates are low and home prices are still reasonable. While you are paying your mortgage down and building equity, you are also going to see your house value go up adding to existing equity.
  "but if I use this strategy I will have a mortgage and a RRSP payment at the same time, I'll be poor"
 No , not necessarily. Your mortgage payment should be pretty low and may be less than you have been paying for rent. As your RRSP only needs to be paid back over 15 years it's managable.
 If you cashed in $15,000 in RRSP's you would pay back $1000 per year or $83. a month. That's pretty manageable , isn't it?  If you need more information, you can visit my website at http://davidcooke.ca
There's plenty of information and informative videos. Feel free to contact me for more information as well.