5 Simple Yet Practical Tips for Managing Your Mortgage
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Today′s economy is an uncertain one, and things seem to change on a daily basis. Companies lay off their employees with very little notice, and prices of things like gasoline and food skyrocket. Despite this, it is possible to manage your poor credit mortgage in Ottawa using these five simple yet practical tips.
#1 – Make Your Payments On Time
Some banks give you a 10-day grace period during which you do not incur any additional charges if you fail to make a payment on your bad credit mortgage in Ottawa. Many people take advantage of that grace period, but what the bank does not tell you is that it still counts as a late payment. If possible, set up your payments for your private home loans in Ottawa to come out of your bank account automatically a few days before the due date.
#2 – Create a Nest Egg
People often get themselves into trouble with their bad credit mortgages in Ottawa when they need to borrow money in emergency situations. If you need a new roof for $10,000, you may be tempted to take out a HELOC or even a second mortgage to pay for it. It is better if you can set money aside each paycheck to cover these expenses when they occur. This way, the bank actually pays you interest on your money and not the other way around.
#3 – Don′t Forget about Property Tax and Homeowner′s Insurance
When you take out your first bad credit mortgage in Ottawa, you might get an “introductory period” during which your homeowner′s insurance and even property taxes are covered. Remember that this will not always be the case, and that insurance premiums along with property tax rates regularly increase. Try to consider this when you take out your mortgage and plan for what you can afford not only right now, but also in the future.
#4 – Do Not Borrow Unnecessarily
One of the biggest mistakes people make when it comes to managing their poor credit mortgage in Ottawa has to do with borrowing even more money after they get their home loans. People spend every bit of their savings on the down payment, buy a house, and then charge up tens of thousands of dollars on credit cards to buy furniture and appliances. When the bills start rolling in, they find themselves in seriously hot water. Try to consolidate all of these costs if you can, and pay very close attention to what you are spending.
#5 – Make Extra Payments Whenever You Can
This is by far the best way to manage your bad credit mortgage in Ottawa. By making only one extra mortgage payment per year, you can sometimes cut your entire term in half – from 30 years down to 15. You can either make one extra payment per year by saving that money in a savings account, or you can divide your monthly payment in half and make one half-payment every two weeks. This leads to 26 half-payments, or 13 months′ worth of payments. Managing your mortgage might seem like an overwhelming task, especially when things do not seem to go as planned. By watching what you spend, making extra payments when you can, and building up a solid nest egg, you can protect yourself both now and in the future.