Re-Financing a Mortgage In Consumer Proposal:

Re-finance of Consumer Proposal

You might be in the midst of a Consumer Proposal, but there may be a way to shorten the time required to pay it out and begin building your credit again. TDFS is a division of Toronto Dominion Bank. They have recently launched a mortgage option for those who are in a Consumer Proposal and have paid as agreed for a 1 year term.

The Mortgage will allow clients to refinance their home (provided they have equity) and pay out the remaining Consumer Proposal. The greater benefit is that the new mortgage would report to the credit bureau and aide in the restoration of a clean Beacon Score. TDFS (Toronto Dominion Financial Services) will consider the 1 year of repayment of the Consumer Proposal as re-established credit for the purposes of obtaining the refinance.

Instead of taking 3 or 5 years to pay a Consumer Proposal in full, the time could be reduced to just 1 year. While the interest rate is higher than a traditional mortgage, the rebuilding of credit and completion of the Consumer Proposal is off set by leaving the Proposal behind and having a fresh start. At the end of this TDFS mortgage, a client should have clean credit and be able to apply for a competitive mortgage through a national lender without higher rates or the possibility of being declined for financing.

If you are in this situation, please contact us today and find out if we can assist you!

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Credit Scores

Your Credit Report Explained!

Your credit report can be broken down into 6 sections which include the following:

Personal Information – your present and past addresses
Inquiries – An inquiry is shown on your credit report every time you apply for a loan or open a bank account. The more inquiries, the worse your credit profile. Try to keep credit inquiries to four a year.
Employment history – listed here you will find your last 3 employers
Public records/collections – in this section your will find a list of collections, judgments, bankruptcies, proposals or lien on assets. Defaults even on small amounts from a telephone bill, gym membership, 407 ETR are harmful to your credit.
Trade Lines – gives the whole record of your debt with each creditor you borrow from – creditor’s name, date(s) amount borrowed, credit limit, terms of payment, balance owed and credit rating.
Credit Ratings – what they mean: R refers to a credit card (revolving credit) and I refers to a loan

R1 and I1 – up to date

R2 and I2 – 60 days late

R3 and I3 – 90 days late

R4 and I4 – 120 days late

R5 and I5 – 150 days late

R7 and I7 – credit counseling

R8 and I8 – repossession

R9 and I9 – bad debt – write off

**If you fall 30-150 days in arrears and pay your account up to date, your rating reverts to an R1 or I1. If it goes to R9 or I9, it will remain for 7 years from the date the debt is paid.

This information is curtsey of goprudent.com.

Bad Credit is like a cold, it can be treated and before you know it your credit score will be better. Think of “Your Durham Mortgage Solutions Team” as your “Good Credit “health care providers! Call us today feel better soon. Contact us right now! Let us help fix your bad credit!