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How it All Began

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How it all began……

I was never good with credit. When I was 16, Lane Bryant sent me a credit card. I had ordered from there catalog for several years. I don’t remember filling out a credit application, just this very pretty purple piece of plastic coming in the mail, and I then could order clothes and pay a small $25 a month until they were paid off. Easy, right? I had my first charge off on my credit report at 18.

I was a single mother at the time, and on welfare. The next step was to go back to work, and I needed a car. But with a new job and a small awful credit file, I needed a co signer. I don’t know how I did it, but I talked my Dad into it. I bought a 1990 Ford and went to work 3rd shift.

I behaved at 1st, making payments on time, and then I moved out on my own. I lived in an apartment with my son, and my soon to be husband. (now my ex husband). Living on my own was hard, and things started to slide. First my car insurance didn’t get paid, then it was canceled. So the finance company added their insurance to the car. Then I fell behind in the payments. Eventually I had to give the car to my Dad, and borrow his paid off car to drive back and forth to work. He was nice about it, but swore he would never co sign for me again, and he never has. Not that I would ask.

When my ex and I got married, we moved south with the military. He then took over the bills. I had given my Dad his car back when we moved, so we were down to one vehicle. We decided to trade his truck in and buy 2 cars, one for each of us. His credit was good, so it was no problem.

Fast forward a few years, and we are out of the military and permanently living in the south. Thing are tight, and my ex and i fight about money a lot. Eventually we end up splitting the bills 50/50, and each of us have to pay out of our own paychecks. He doesn’t care about any credit cards, just that if they are in my name, I have to pay them myself. Me, having no self control with money, rack them up. We split in 2001, and he walked away with a paid off truck. I was left with 10,000 plus in credit card debt, student loans, and a single wide mobile home with a 20 year mortgage.

I then decided that I wanted a new car. The one I had was with a credit union, and I was upside down a lot. But it was in my ex husband’s name. So, I let it go back, and bought a car on my own. Took out more credit cards. Move to a rental house that was $250 more a month and let the single wide trailer go back to the bank.

Are you starting to see a trend?

Don’t get me wrong, I was making it, but by the skin of my nose. By then I was at my current job but a single mom of 2 kids. Do you know how embarrassing it is to have collection agencies call you at work, while you are a bill collector for your job? One time, they even faxed my boss about my debt. I blamed my ex husband, and prayed that they would stop one day.

Then the rental house caught fire. Thank goodness I had renters insurance. I had a ton of cash, and a spending habit that I had not fixed.I found a new place to live, a rent to own house. I had one year to rent, and I had to get the mortgage in my name. I did it in 6 months. That was the height of the housing bubble, and I got a 11.75 % variable APR mortgage on a $125,000 house. But I had a ton of money from the insurance, that made it easy. My spending habits didn’t change. My kids and I had more stuff then we knew what to do with.

I then met my current husband. He is 6 years younger than me, and still was living at home. We has a speedy courtship, 4 months from our 1st date to our marriage. The money from the fire had run out by then, and he didn’t have a well paying job, so I robbed Peter to pay Paul to pay for the big wedding we had. The mortgage company did the 1st loan modification on the mortgage within 6 months. They lowered my payment and my interest rate to 7.5 % fixed. I thought everything would work out.

Traded and bought a few vehicles, and racked up more debt. Was kinda of keeping my head above water, then my husband got sick. We then had huge medical bills that included a bill for a cornea transplant. Everything got past due, even the house again. We went and filled out the paperwork to file chapter 13 bankruptcy but didn’t have the filing fee until we got paid on Friday. Thursday, I went out my front door to goto work, and my car was gone. It had been repossessed in the middle of the night. So, I borrowed the filing fees to file a day early, and the next day, the lawyer got my car back from the bank.

Again, things were fine for about 6 months then hours were cut. My husband had to find a new job, and took a $2 an hour pay cut. That hurt. Our Chapter 13 payments were self pay, so we stopped them. And our plan was dismissed.

We went back to the attorney, and asked what to do. He said to keep the house, we would have to file chapter 13 again, but reduce what we were paying in the plan. We gave back my car, but kept my husbands truck. I went out and found a mini van on a buy here pay here lot and got that for transportation as our family by then had grown by our twins and we didn’t fit into the truck by then. This time my pay was garnished for the payments, and my take home was about $250 every two weeks. My husbands was about $600 every two weeks. Everything else went to bankruptcy. It was very tight. So tight, that I even went behind my husbands back and got 4 credit cards while in bankruptcy. See the trend.

Then the layoff. My health insurance at the time was 100% paid by my employer, but my husband carried the girls and himself. To add him and the kids to my heath insurance was $300 a paycheck. His unemployment was $115 a week, and I only was clearing $250 a paycheck. The bankruptcy payments had to stop. My attorney got the trustee to stop the garnishment, and I put everyone on my health insurance. We saved up and filed income taxes, and converted to a chapter 7. We bought 2 salvage titled cars, and let the truck and van go back to the banks. We did another modification that included stretching the mortgage to 40 years from 30 years, and kept the house. We were discharged from chapter 7 in July 2013.

Stay tuned for part two…


Finance Management in Your Forties: 5 Important Factors

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Many people consider their career high to be somewhere in their forties. Combining the ambition and excitement of their earlier years with the experience that comes with time, your 40s could be a time where you have made the right decisions and are enjoying a certain stability in your life. It could also be the most important time to start some serious planning about your family’s future and to think about slowly easing into retirement.

Here are some tips to manage your finances in one of the most crucial junctures of your life. These can make a significant difference in your life 10-20 years from now. That may not be the most compelling case for a look at your financial profile now, but it is certainly something you will come to appreciate at a later point.

Asset Allocation

Your risk profile should and will change with age, and it’s important that you adjust your investment portfolio accordingly. Make sure it suits both your short-term and long-term goals. Investment in equity may be a great plan for when you retire, but it be would less suitable if you have financial requirements that are coming up sooner – maybe your kids are graduating in a few years and you need to plan for their tuition; maybe you are expanding your family and plan to buy a bigger house. Your plans must fit into your investment portfolio. Make sure they are well-diversified and that there is no allocation overlap.

Invest in Profitable Assets

If you have been fortunate enough to have a stable income in your 40s, you should look into making well-thought-out investments in solid assets, but you have to be careful as to what that “asset” might be. Investing in a second car might sound like a convenient idea, but it wouldn’t count as an asset because the capital cost would be depreciating down the line. Ideally, you should look into income potential for capital growth, short-term capital gains and the risk involved before you decide about investing in an asset.

Maintain an Emergency Fund

By this time in your life, you must have a decent emergency fund. If that is not the case, it is important to start now. You will find that your emergency funds will be tested more and more in your forties. Be it health troubles or your child’s education, health or even wedding expenses, it can hit you from any direction even though you might have insurance Winnipeg coverage to offset some. Make sure you maintain an appropriate-sized emergency fund and keep replenishing it as necessary. Also, it might be a good idea to reinvest it in some other taxable investment account so that it can grow, especially if you feel like you have less use for it. Withdrawing it can come with some penalties, but you’ll have a higher chance of making a sizeable growth over time.

Insurance

Making sure you have appropriate insurance coverage is one of the most important factors to take into account. Your insurance needs at 40 may differ greatly from your 30s, especially in relation to your health. Even if your employee package covers this, it would be prudent to review it now and then. Do you need a long-term care package? Would taking out disability insurance be appropriate? It could be a lifesaver in the event of income loss due to unforeseen emergencies. Have you renewed your term insurance package? Have you reviewed your claim beneficiaries in the event you’ve had some major life changes, like a divorce? If you have large assets, consider an umbrella policy that covers life, health, auto and home insurance all in one with good coverage so you don’t have to manage separate policies.

Retirement

Are you earning more now in your 40s than you were when you last upgraded your retirement account? Perhaps it is time you review your investments in that area now that you are getting closer to retirement. Many people make the mistake of siphoning off excess income into an inflated lifestyle, the net gain of which is zero. Consider boosting your retirement contribution. This could take the shape of adding to your 401K, or if you aren’t satisfied with the matching contribution you are getting, you could roll it into an IRA that you control.

With that said, don’t forget to take out some money to invest in yourself. You have worked your way up to this stage, and you deserve to sit back and enjoy some of your hard-earned money. While retirement planning is an important factor that you have to start considering from now on, don’t forget that you only get to live your 40s once.


Rain and Gusting and Ice: How to Drive in Bad Weather

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Picture the ideal day for driving. It’s probably mild and bright without a cloud in the sky. Unfortunately, the weather rarely complies with our driving wants and needs. Most peoples’ first choice would be to stay off the road during inclement weather, but sometimes life beckons. Whether you’re commuting to work or embarking on a road trip when a storm hits, how can you prepare for bouts of bad weather and keep yourself–as well everyone else on the road–safer?

Plan Well Ahead of Time

You can’t control the weather, but you can certainly control your preparedness for any situation you encounter on the road. Before you leave the house, check the weather. Sunny skies could turn to thunderous clouds over the course of a few hours. Look into all possible routes to see if you can avoid the worst of the storm, and leave early so you have enough time to reach your destination without rushing.

Bad weather is not the time to discover that you have a vehicle malfunction. J.D. Power recommends having your vehicle checked more frequently during seasons of bad weather like winter, and making sure that your windshield wipers, headlights, and mirrors are in working order before you pull out of the driveway.

If you live in a cold climate, pack a winter survival kit in case your vehicle gets stuck or disabled in the snow. The basics include, but are not limited to:

  • Windshield scraper and small broom
  • Flashlight and batteries
  • Energy-rich snack foods
  • Warm clothing and blankets
  • Grainy material for traction
  • First aid kit and pocket knife

It’s Raining, It’s Pouring

A little rain never hurt anyone, right? When it comes to driving, wet roads and impaired vision actually increase the likelihood of an accident. Almost everywhere in the U.S. experiences rain at least once a year, and some states can expect steady annual downfall. One of the best preventative measures you can take is increasing the space between you and the vehicle in front of you. Edmunds suggests aiming for a six-second gap to be on the safe side. If wet and humid conditions create fog, use your low beams to maximize visibility.

Hold onto Your Hat

It’s not just obvious tornado and hurricane-induced winds that drivers need to consider. Hurricane winds are considered 74 mph or faster, but the weather service puts out advisories for much lower speeds. In wind-prone states like Florida, the advisory covers sustained winds between 25-39 mph, or gusts at 57 mph. Robert Molleda of the National Weather Service explains some associated risks: “If winds are above 30-35 mph for extended periods of time, it can be an issue for high-profile vehicles on bridges and overpasses. Also, tall objects such as construction cranes can be hazardous in those winds.”

Sounds like a recipe for potential damages, doesn’t it? As for driving in gusty conditions, The Telegraph suggests that drivers should ease off the gas, brake steadily, and hold the steering wheel firmly to maintain control against the onslaught. It goes without saying that windy occasions are not the time to speed or tailgate. Even so, drivers can’t always react in time to others on the road or blowing debris. Drivers need to protect their vehicles and themselves against these weather-associated risks by having adequate insurance coverage, not just the minimum required by law. For example, if you’re in the Sunshine state, legal Florida auto insurance only equates to PIP, or personal injury protection coverage. However, chances are you’d need more coverage than that if you were involved in a weather-related accident.

Ice, Ice Baby

Snow and ice are beautiful from the vantage point of a warm house, but the story is much different from inside a car. Follow these guidelines from the Occupational Safety and Health Administration (OSHA) whenever possible to reduce risk when your tires are on ice or snow:

  • Steer into a skid
  • Stomp on antilock brakes and pump non-antilock brakes
  • Give yourself longer stopping distances
  • Rehearse maneuvers during the daylight in an empty lot
  • Avoid fatigue and rotate drivers when possible

With proper preparation, the right protective measures, and practiced defensive driving skills, you’ll be more ready to take on the elements in your vehicle. It’s preferable to stay home, but if you absolutely have to be out and about, stay safe and slow down.


Fulfilling Charitable Resolutions Without Breaking the Bank

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how to keep your charitable resoltions

By Holly Tomlinson

Giving back more is one of the most popular resolutions made each year, but as we round out the first month of 2016, I find myself having done nothing towards my goal. If you’ve also made a commitment to improving the world around you, you might be wondering how you can do so on a tight budget when you find yourself often having less than you need. I always try to remind myself that there is always something worse off who could use a helping hand, and I’ve come up with a list of ways you can fulfill your charitable resolutions without breaking the bank.

Spring Cleaning

The phrase “one man’s trash is another man’s treasure” couldn’t be truer. Consider donating used goods that you don’t get much utility from anymore. Clean out your closets, including those of your kids, and put any things that you’ve outgrown or haven’t seen in at least six months into a bag. You can also go through recreational items, like hockey sticks from an abandoned hobby, old golf clubs, baby toys, and other things you can bear to part with. Take them to a local church, homeless shelter, or Goodwill and make a difference in someone’s life.

The Tax Breaks

While altruism should be the main reason behind your urge to give back, you can’t deny that tax breaks do give incentive to charitable contributions. A gift to an IRS-approved charitable organization may entitle you to a tax deduction if you itemize deductions on your tax returns. Most charities qualify for this deduction but make sure you do your research before banking on a tax break. You’ll also need to ensure you get receipts from your donations, as no deduction is allowed for anything over $250 if you don’t have documentation of it.

Unused Gift Cards

If you’ve got gift cards with small balances that you’re never going to use, consider giving them to charity or a homeless shelter. More often than not we let them hang out at the bottom of our purses or tucked behind credit cards in our wallet, and according to a MarketWatch estimate, almost $750 million worth of gift cards went unspent in 2014. Don’t hang onto it on the off chance that you might use it, and give it to people who could actually benefit from it.

For Online Shoppers

If you’ve got a mean online shopping addiction, use your purchases to donate money to charities that could use your donations greatly. Websites like iGive.com allow you to choose a cause to support initially. After you’re set up, all you need to do is shop on iGive-approved websites — they’ve got upwards of 1,700 online shopping sources to peruse. Everything from car rental websites to upscale clothing stores are on the list, meaning your every need can be met with the added bonus of donating to a charity that’s close to your heart.

Use Social Media

If you’re looking for ways to get involved, stay active on social media and follow different charities. Often local organizations will post about upcoming events, giving you the opportunity to participate and make a difference. Another handy part of the process? You’ll be able to share great things that come up and spread the news to your friends and family — you never know who’s looking for a way to get involved. Social media outlets like Facebook often have pages where likeminded volunteers can come together in their community and plan ways to get involved, so do a simple search and press join–you’ll be glad you did, I guarantee it.

The Ripple Effect

Even the smallest gesture can create a ripple effect of altruism within your community. Small generous efforts can mean big results, and you don’t have to spend a ton to get them done. If you’re a Starbucks addict, pay for the coffee of the person in line behind you — they might be so thankful that they’re inspired to pay it forward. If you know of a family friend going through a hard time, pick up a gift and drop it off at their home unannounced. Even something as simple as dropping off cookies at a children’s hospital will change someone’s day. Fulfilling your charitable resolutions is easier than you might think, and changing the world starts one person at a time. Consider what you can do to improve your community, and watch the karma dividends come back to you.

(Photo courtesy of Randy Heinitz)


6 Stay-at-Home Jobs I’ve Done as a Stay-at-Home Parent

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6 Stay at home Pic 1

Being a stay-at-home parent is inarguably one of the most fulfilling and frustrating jobs on the planet. For one, you get to see your children grow and change — but to do this, you must sacrifice the perks of the working world, including the camaraderie of co-workers. Fortunately, staying at home doesn’t mean surrendering the most useful aspect of having a job: additional income.

Even after just a few weeks of doting on my first baby boy, I was itching to get back to work. Instead of abandoning him to daycare, I sought job solutions that would allow me to stay at home while completing projects and earning pay. Today, I am still satisfied as a stay-at-home mom, and I receive extra satisfaction from my stay-at-home job. For other stay-at-home parents interested in having your kids and working, too, here are seven easy, flexible jobs I’ve tried that helped me be both a proud parent and an excellent earner.

Daycare Provider

New parents have plenty of opportunities to connect with fellow new parents. During pregnancy classes, in doctor’s offices, and at baby classes (like music and swimming) I was able to cultivate a network of moms and dads who were going through the same situations I was. The difference was that most of them were planning on returning to work; fortunately for them and me, I wasn’t. Thus, I was able to start a small daycare among friends and earn a healthy income doing what I wanted to do as a new mother: take care of babies.

If you didn’t gain such a close-knit group during your pregnancy, you can still become a daycare provider. You can post fliers in your neighborhood to build awareness of your business, and you can even take in pets if you aren’t yet comfortable around others’ kids.

Crafter

Whenever I didn’t need to directly interact with my children, I usually had some sort of craft in hand. At first, crafting was simply a hobby I used as a creative time-waster, but eventually, I recognized that I could spin my diversion into another money-making scheme. With a few online stores and a spot in most of my city’s craft fairs, I was able to earn a sizeable chunk of change — and rid my house of all the crafting clutter.

Hundreds of hobbies translate well into small income generators: baking, sewing, woodworking, knitting, and more. However, before you can safely sell your goods, you should consider filing as a limited liability corporation, so you can protect you assets fully.

6 Stay at home Pic 2

Secret Shopper

As soon as my kids could walk, I knew I had to get out of the house. It didn’t matter where we went — as long as we were breathing fresh air. Fortunately, I was able to use my need for movement to bring in some cash. A handful of stores will pay shoppers to rate their in-store experiences. Now, secret shoppers can turn to apps containing lists of “missions” that make finding convenient, paying tasks a snap.

Tutor

When my kids started going to school, I quickly realized how much basic information I had forgotten. In order to be a better mom, I quickly enrolled in a handful of simple courses and bought textbooks to relearn all my lost knowledge.

Not only did that help me encourage my kids to succeed in class, but it allowed me to earn some side money as a tutor for other parents’ kids. Advertising with fliers at my kids’ schools — and eventually online on various tutoring websites — I accumulated a gaggle of well-paying tutees.

Salesperson

Eventually, my kids became teenagers, and the benefits of being a stay-at-home parent were fewer. Still, having been out of the regular work force for so long, I was reluctant to commit to a set schedule outside my home. Instead, I turned to sales. In the past, companies like Mary Kay Cosmetics and Tupperware allowed enterprising individuals to get a business up and running fast. Today, companies like this still exist, and with Web connections, the jobs are more flexible and fun than ever.

Freelancer or Consultant

I only recently turned to freelancing, and it is undoubtedly the most rewarding job I have ever had (besides being a mom, of course). It is as fulfilling as real work, as you work with clients and complete projects just like salaried positions — but you get the flexibility and authority of working for yourself. If you were successful in your field before your child or you have a wealth of specialized knowledge you are itching to put to use, freelancing or consulting is likely the best option.


How I’m Saving Extra Cash with My Car This Year

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When it comes to saving money, I’ve found that the best policy is to find little leaks that can be easily plugged, but the savings derived from them adds up over time. Recently I took a look at my car, and I took five steps that will save me hundreds of dollars this year. This is far from comprehensive from what you can do to save money on your car, but it can show that just thinking about how you might save in one area can help you come up with creative ways to do so.

Take off the Ski Rack

I haven’t been skiing for about 2 months, but I still had my ski rack on top of my car. It took five minutes to remove it and store it in the garage until next year, but doing so will improve the gas mileage my car gets because there won’t be the resistance and drag the ski rack caused. I have a bike rack too, but I won’t put it on until I need to use it, and I’m determined to take it off between uses this summer.

Regularly Rotate My Tires

I buy my tires at Costco. What a lot of people don’t know is that they will rotate your tires for free (Les Schwab, Big O, and some other tire outlets offer this service for free as well). I do this regularly because I didn’t do it with my last set fo tires and due to uneven tire wear, I ended up losing about 10,000 miles of life on them according to the tire guy. That ends up being enough miles that I would have to buy an extra set of tires for me car during its lifetime if I didn’t get the rotated every 5000 miles. With a set of tires costing hundreds of dollars, that’s a big saving for something that’s simple to do if you make the time for it.

Don’t Use My Car (as Much)

It’s such an obvious way to save money, but among my friends, I’m the only one who consistently does this. If I don’t need to drive the car, I choose an alternative method of transportation. I don’t drive to the grocery store that’s about 2 miles away. I ride my bike instead. Not only does it save gas plus wear and tear on my car, I get the exercise I wouldn’t otherwise get which has let me cancel my gym membership. It’s reached the point where I only use my car about 50% of the time when I leave my house. Most people I know use theirs 90% – 100% of the time.

Compare Insurance

You know all those commercials that say you can save hundreds of dollars switching insurance companies? A lot of them are correct and the Internet makes it easy to do. I actually love my insurance agent, that that hasn’t stopped me from getting better deals. Each year I do a search to see what the lowest rate Ic ould get from another company would be and take it to him. He hasn’t always been able to match it, but he gets as close as he can. I’m willing to pay a bit more to stay with my agent since I know I can count on him when there is an issue, but that doesn’t mean I can’t save money in the process as well.

Insurance Tracking

I let my car insurance company track my driving. I know a lot of people don’t like this, but I drive like an old lady anyway so it doesn’t bother me. My insurance company calls theirs SmartRide, but almost all companies have them now such as Snapshot. Basically, these devices track your driving and miles, and if you don’t drive a lot (like me since I take my bike on a lot of the shorter trips), you get a discount. I lowered my costs by about $100 a year by using it.

None of the above takes a lot of time or effort to do. It’s just a matter of doing it. And this is just one area of my life. I’m planning on doing the same thing to many other areas of my life to cut out excess spending fat that can be trimmed without much effort.


Top Common Myths About Mortgages

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By Dean McCarthy

As a mortgage broker, I find that people who are in debt, and those who are looking to purchase a home after being in debt, often have misconceptions and myths about how mortgages work, and these can cost a lot of money and aggravation to those looking to purchase a home. Don’t let these myths deter you from getting your dream home, and having the knowledge of how they work will put you in a much better position to get it.

Myth #1: Prequalification means you have a guaranteed loan

It’s always advised to get prequalified before looking for a home. This helps you and your realtor know the ballpark figure you’re working with for a home to purchase. The prequalification process, of course, requires your income and credit to be evaluated. However, lenders don’t dive deep into all assets and debts. So no financial lender can guarantee you this loan amount.

What I find confuses people is that prequalification and preapproval aren’t the same thing, although many people think they are. If you get a preapproval, your lender goes through all your finances with a fine-toothed comb. This amount is just as good as guaranteed. However, your credit and finances could be reevaluated at any point before they close on your mortgage, so you do have to continue to keep your credit and finances in good order.

Myth #2: You need to have 20% down before you can purchase a home

To be honest, you want to have a decent sized down payment available when you purchase a home. The myth that you need to put down 20% before you can purchase a home was for the purchaser’s benefit. That’s because for many loans, putting down anything less than 20% would increase your interest rate and require a Private Mortgage Insurance (PMI) to be automatically added to your mortgage loan, costing you thousands to tens of thousands more over the life of the loan. However, now with more people qualified for the Federal Housing Administration (FHA) loan, you can qualify for a mortgage loan with just 3.5% down. While I believe you should still shoot for that 20%, it’s important to know there are other options if you come across your dream house before you have that 20% saved up.

Myth #3: The FHA is the mortgage lender

Another misconception I come across is that the Federal Housing Administration is an actual mortgage lender. This is not true. They are a government agency under the U.S. Department of Housing and Urban Development. What they do is offer mortgage insurance stating they will back up a loan that a financial institution makes. So any losses such as a foreclosure or short sale of a property funded by an FHA loan would be reimbursed by the FHA to the lender.

Myth #4: You need a high credit score to be eligible for FHA loans

Here, again, I think everyone should get their credit score as high as possible when considering a purchase of a home. While most mortgage loans do require good credit, this isn’t true in regard to FHA loans. Credit scores are not a factor when it comes to being approved for an FHA loan. These loans initially started as a way for those with no or low credit and low income to be approved for loans to live the dream of home ownership. Lenders must go through the applicant’s entire credit history on file and not just pay attention to a few late payments. These loans are even available for those with prior short sales, foreclosures, or a bankruptcy. Let me be clear, not everyone with poor credit will be approved, but if you have been taking steps to improve your credit, your chances are greater for approval than with a conventional mortgage loan.

As a broker, having the correct information is important to making a good decision which fits your circumstances. You want to be in the best financial and credit position possible when applying for a home loan, but you also don’t want to lose out on a great opportunity because you think something can’t be done when it can.


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