The RRSP Secret

Have you really taken a good hard look at your retirement funds? Do you know how your investments are doing? The reality is most people rely on an Advisor or even someone at their place of employment to “pick” what’s right for them. Is this not a scary thought? I made a decision a few years ago to take control of my investments after losing “lots” in the stock market. On top of that my “safe investments” in mutual funds were a little too safe and were not even keeping up to the cost of living. If the cost of living goes up by 2.5% and your investments are making 2.5% (assuming after management fees), you’re really earning zero. To me this just wasn’t acceptable, nor should it be.

That’s when I discovered a secret.

Most people don’t realize that you can invest your RRSP, TFSA, LIRA, RESP, etc. into mortgages. In other words you can use your registered plan funds to do what the banks do. Would you agree that the banks earn a big profit from mortgage portfolios? Would you agree that real estate unlike some stocks will never go to the value of zero?

Of course you can invest in second mortgages with client profiles that may be less then perfect (which can also be very lucrative and secure). But what if you could do the same thing with blue chip real estate builders and developers? You can! This is very exciting to me! Imagine instead of investing in paper, you could invest in a project that you can drive by. A project that you can see in motion, something tangible. What if I said that your individual name was registered on title to the land proportionately for your entire principal investment? What if I said that there was an interest reserve fund held in trust by an arm’s length facilitator? I challenge you to find something more secure then this. Oh, I almost forgot, the terms are typically 3 to 5 years, and the return would be 8% per year paid monthly with an opportunity for a deferred bonus of an additional 10 to 14%! Sound too good to be true? It’s not.

2013 is just underway. Why not take a few minutes to explore this opportunity I can share with you. There are no management fees, you don’t pay me a cent. If you don’t take the time to better your future who will?

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Credit Score Boot Camp – Part 5


You know how you’re always asked at the checkout counter: “would you like to apply for our fill-in-the-blank Store Card? You can save $X dollars on your purchase today…”

Don’t do it. These pitches – a common part of the retail experience – are a potential credit pitfall. Applying for these store cards generates a “hard” inquiry that goes on your record, and is visible to lenders looking at your report.  Every time you seek credit by applying for a credit card, store card, or loan – you generate a hard inquiry. Too many inquiries will flag you as a potential credit risk because it signals credit desperation. You should keep these to a minimum.

There are exceptions, of course. If you are shopping for a loan or a mortgage, a lender will expect to see a short burst of inquiries against your credit score. It’s best if these happen fairly quickly and around the time of a loan event.

There’s also such a thing as a “soft” inquiry; only you can see these, and they do not impact your score.  Potential employers might make an inquiry, for example. And when you check your own credit report, your inquiry is both invisible and irrelevant to your credit score.

Make a habit of checking your credit score at least once each year – and watch how those good credit habits push your credit score skywards.

Credit Score Boot Camp – Part 4

BUILD CREDIT HISTORY: Always keep your oldest credit card.

Wasn’t it exciting? Your first credit card? For most of us, it was our introduction to the real financial world: the privilege of borrowing, and the responsibility to pay back.

Perhaps you’ve changed your financial institution since you got that first credit card. Here’s an important piece of advice: keep that credit card. Even if you now do most of your banking with another institution, that old credit card is valuable to your credit score. If you can, you should always keep your oldest card, and use it a little so it remains active. That long credit history is a valuable asset.

Someone who has no credit history is usually viewed as riskier than someone who has credit and manages it responsibly.  If you are thinking of canceling a card, get some advice first, even if you aren’t using it.

Simply put, use credit wisely. Keep your oldest card, use it regularly, and keep it paid up-to-date. Remember the 30% rule, and fight hard to get your overall debt to under 30% of your available credit… and keep it there!

Credit Score Boot Camp – Part 3

MANAGE YOUR CREDIT CARDS WISELY: Show your credit worthiness!

Many people make the mistake of rushing to cancel credit cards in an effort to improve their credit score. Bad idea. High balances are the problem; your credit score is based on your balances relative to your available credit. Those cancelled cards represented “available credit” so canceling then could actually hurt your score!

Ideally, you want to have a few credit cards with reasonable interest rates that you use regularly and pay off promptly. Look at your credit card limits and calculate 30% of each card’s limit. Consider that your upper spending limit and stay within it. Same goes for any lines of credit. Follow the 30% rule and stay on top of payments.

Paying down your debts to under 30 per cent is a great way to boost your credit score. If you need to carry a balance, it’s better to be below the limit on more than one card, than at or over the limit on one card.


Simcoe County Home Ownership Program

If you have stable income and good credit, however, lack a down payment, maybe you can still get a mortgage

The Simcoe County Homeownership Program aims to assist low to-moderate income renter households to purchase an affordable home by providing 10% down payment assistance in the form of a forgivable loan.

This Program provides renter households with the opportunity to move to homeownership thereby freeing up rental units, encouraging developers to build affordable housing and fostering demand.

Applications for the new down payment assistance program are now being accepted. Funding will be made available in 2012 and 2014.

Any down payment assistance that is paid back to the County by purchasers is held in a ‘Revolving Fund’ to be redistributed to future home owners. Program details, eligibility requirements and Applications are available by contacting the County of Simcoe, or you can download a copy and see more details here .


Credit Score Boot Camp – Part 2

PAY THE BILLS ON TIME: You’ll need a fool-proof system

The single biggest factor behind a strong credit score is having a timely bill payment history. Credit agencies keep track of every late payment. And each one impacts your score. The good news is that recent late payments are factored more heavily than old ones: so you can start today with a commitment to NEVER let a bill get past due. In as little as six months, you’ll look more creditworthy to a lender. The longer your “good” history is, the higher your score.

The hardest hits on your credit score are bankruptcies or accounts that have been sent to collections. Even for a small amount – and even if it is in dispute – being “sent to collections” will create a serious, long-term stain on your credit reputation. Don’t let it happen. [Read more…]

Credit Score Boot Camp – Part 1

GET YOUR CREDIT REPORT: See what your lender sees

You might think that lenders make decisions based on some intricate financial calculation. In fact, lenders can easily pull up your credit report and see your credit score, which is based on how well you pay your bills on time, how much debt you’re carrying, how long your credit history is, your pursuit of new credit, and the types of credit you have.

If you’re going to whip your credit score into shape, you’ll want to know what you’re working with. Get a copy of your report and see what your lender sees.

Credit reports can be ordered for free through the mail, or for a small fee you can download your credit report – and your score – online. More information is available at or  Scores range from 300 to 900. You’ll want to target a score of 650 or higher to access the best credit rates and terms.

[Read more…]

In The News

Always lots of information coming from the media. House prices up, house prices down. Interest rates are going up, interest rates are going down. How do you know who to believe? I suggest doing your own research should you be the “type” that needs to see the data. CMHC and the Canadian Real Estate Association are good sites to start with. How you present data in a news story may not depcit the true story.

First Time Buyer? Have RRSPs?

Thinking about buying your first home? Wish you had saved up a good down payment? Maybe you have, but didn’t know it. Designed to help first-time buyers get into home ownership, the federal Home Buyers’ Program lets you access tax-free monies for use towards the purchase or even construction of your first home.

Why tap into your RRSP? The most common reason is to boost the down payment on a home. The bigger your down payment, after all, the smaller your mortgage. And you may qualify for better interest rates too; your healthy down payment shows the lender that you are a low-risk candidate for a mortgage loan. [Read more…]

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