What it Means to Have Canadian Car Insurance

July 8th, 2010  / Author: Canada Money Guru

As with all insurance car insurance is a necessity and you should try to get as much as you can afford. Canadian car insurance varies from one province to another but whatever the cost one should never drive without insurance. That may be a very costly mistake.

Canadian law requires all drivers purchase automobile insurance. The insurance companies assess each application against many variables. The various rates are based on these assessments.

There is a minimum amount of insurance coverage required by Canadian law. Except in Quebec, the coverage is up to $200,000 for injury and personal damage to others. Should the claim be higher then you will have to be liable for the balance except for $10,000 in property damage. Quebec has a requirement of one quarter of that amount because the government covers injuries to individuals.

A strategy you may want to consider in buying your coverage is to buy the minimum. Afterward you evaluate assets and needs in order to buy additional insurance. This, as any other insurance, is a protection against some unforeseen disaster in the future.

Your insurance company will want to know the details about your car, how old you are, the number of times that you have had an accident or received tickets for road infractions, your gender, and where you live. They will assess your risk factor with this information. From this assessment they will set the rate you pay.

Typically in Canada the basic policy will protect you if you are liable and there is damage to another person. This is referred to as third party liability. The insurance will protect you if you are injured in an accident. If a driver is not insured or you are a victim of a hit and run there is coverage provided should you be injured or die.

Also available as optional is coverage including all perils, comprehensive and specified perils, and collision. All of these options or a combination are available for protection should you lose or damage your car due to fire, collision, theft and other risks. You evaluate your options and then find out the cost. You may feel that some are more important to you than others.

There is also coverage for your classic car. This has many stipulations and the cost is rather high. However, after the amount you have paid or the work you have put into this vehicle you may think it is very wise to have the special classic automobile insurance.

Generally you buy insurance through licensed brokers who are really intermediaries between you and the actual insurance company. They usually deal with different companies and try to find the best coverage for you. They are independent, offer advice and support, and are very respectful of your needs. You may want to deal directly with one specific insurance company who will assess your requirements and offer you the service. Today, you can also buy automobile insurance online.

Protect yourself and your family. Try to purchase the best insurance that you can possibly afford. In spending it now you may save yourself some outstanding costs later.

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Canadian Car Insurance FAQ:

Question: Why is canadian car insurance so expensive for newly arrived immigrants?
I was paying 250 quid in the uk and now they want $3000 odd! Talk about havin me pants down! Any ideas on the best insurance company to use?

Answer: Because your driving history didn’t follow you. Some things you can try:

1) Get the UK to supply you with a certified printout of your driving history (driver’s abstract)
2) See if your UK Insurance provider has a Canadian Subsidiary
3) Visit insurance hotline as they will instantly compare rates filed with the the insurance regulators and you can see who is best for you. Rates can vary by thousands for the same driving history and same vehicle

Question: Is there a website where I can get a canadian car insurance quote?
I know there are some, but I’m looking for one that doesn’t require your personal information. And if possible one that can let you enter in vehicles older than 1995.

Answer: I would start by calling up the company that your parents are insured with and ask them for a quote. Be sure to point out that your family has been insured with them for x years. Sometimes, you can get the best deal of all just by staying with that company.

Also, you can ask at your banking institution. They are often allied with insurance companies — like TD Canada Trust, which also has TD insurance. That way, they already know most of your information and only need to ask a few more questions.

Another possibility is an insurance broker. This is not the same thing as an insurance agent. A broker deals with several insurance companies and looks at your unique situation and can recommend the best (for you) of the companies he (or she) deals with. To find one near you, look up insurance brokers in your yellow pages. They are, of course, listed after the insurance agents — just don’t confuse them, because the agents are the representatives of only one company.

Question: Does your canadian car insurance rate go down if you have a child?
We are expecting a baby and people keep telling us this, but not sure if its true.

Answer: With children it usually goes up.

Question: What Canadian car insurance company will give me the lowest rate if I’m just buying my first car at 18?

Answer: I don’t know about the lowest rate BUT I will advise you to google any company for their payment of claims. Cheap insurance is one thing but if they don’t pay the claims, what good are they.

Question: If I am traveling to Canada do I need canadian car insurance?

Answer: To drive your vehicle legally you are required to have proof of insurance. The necessary document can be obtained from your insurer in the US and will be required if you are stopped for any reason and asked for proof of insurance. While you do not require specific “Canadian” insurance your are required to have proper insurance on your vehicle.

Question: Can I borrow my friend’s car under his insurance for a day under the canadian car insurance law?
I need to borrow my friend’s car to go to niagara falls for one day? Can I do that? I currently live in toronto and I have no idea for the insurance rules here?

Answer: You can with his permission. You aren’t planning on crossing the border, are you? If you do I don’t know how that would work. I suppose a notarized “He has permission to use my car on this date” would help if you are.

Question: Are credit scores used in Canadian car insurance rates?

Answer: It depends on what province you live in. In provinces where it is all private (Ontario, Alberta, Maritimes, Territories) it is becoming more and more common, however not all companies use it. Government run insurers do not use credit as a basis for determining rates.

Question: Why are car insurance rates in Canada almost 3 times of US cities?
Canadian Car Insurance rates are off the roof. It doesn’t make sense to me.

Answer: Depends on where in the US you are comparing rates to. Plus you do realize the minimum liability limit you have to carry in every province/territory in Canada (except Quebec where you can’t sue for bodily injury and only need to carry property damage liability) is $200,000/accident (there are no per person limit) where in the States it can be as low as $20,000 per accident (Louisiana and Oklahoma).

How to Repay Payday Loan Debts

July 6th, 2010  / Author: Canada Money Guru

Taking debt is easy, but repaying it becomes equally difficult. Same becomes true in context of payday loan debts. These are easy to avail and subsequently become an attractive proposition for borrowers. As a borrower, sometimes you seek more than two payday loans in fact, in some cases the number can go up to three or four. However, this practice leads to a huge financial burden. Once trapped in that vicious debt cycle, things become much more difficult to handle. Nevertheless, with many easy repayment options available, all such difficult situations must ease down.

Under all above mentioned circumstances, the best possible alternative is applying for professional help. Since not many of you are aware of this facility, obtaining relevant information about the same becomes extremely important. A debt consolidation service may prove to be highly efficient in this regard. It offers instant relief from all short term credit debts. It does not really matter what the nature of loan is. There are solutions for every type of problem, since the debt market has become quite extensive.

Timely Repayment

Even though easy solutions are available to deal with any type of debt related issues, personal responsibility is equally important. You need to be responsible to make timely payments of your all outstanding dues. This further shows that resort to any relief help only when the situation has completely gone out of control. Make prudent decision regarding your finances as an old popular adage goes, “prevention is the best cure”. While obtaining any payday cash debt, show your presence of mind and always settle on for the best. There is no harm in gaining short term financial relief provided it is for the right purpose at the right time. Never delay payments because they accumulate and finally result in heavy amounts. One important reason for such an acute accumulation is unpaid interests and service charges. Since payments are delayed these service fees and interests keep on accumulating. Subsequently, you end up paying double the original borrowed amount.

Some Careful Observations

Always try to seek an amount, which complements your current income. Never ask for funds in excess of your requirement. As long as payments are on time or due date, no financially troublesome situation arises. Even no help for consolidating payday loan debts is needed. So make sure that borrowed money is paid back on your next payday. However, lenders also take utmost care in ensuring smooth organization of their borrowers’ finances. They consider employment status, bank account details, personal information and other such relevant information before disbursing funds. You should be able to show a fixed and constant income flow in order to be eligible for any monetary relief.

Above discussion makes it crystal clear that a right approach towards finances may really come in handy. Efficient management of your money can certainly help you come out of any grave economic situation. What all to be done is repay your cash well in advance, so that all embarrassing and humiliating circumstances may be avoided. However, if the situation is grossly unfavorable seeking credit counseling or help may become absolutely necessary. It may help you repay all outstanding payday loan debts effectively.

Payday loan debts may become irritating if not paid off on time. Under those circumstances they need an urgent solution. debt consolidation service may provide much needed relief in such situations.

Payday Loan FAQ:

Question: What happens if someone took out a payday loan in my name?
I’m going through a nasty divorce that has been dragging on for almost a year. A couple of days ago, both my brother and sister got phone calls from someone claiming to be a collection agency for a payday loan company saying that I had taken a payday loan and failed to pay on it. I have never taken a payday loan and my attorney cannot take action until I have something in writing. What can I do?

Answer: It does not sound like an actual collection company, (actual collection companies can’t state they are calling because of an unpaid debt unless they are talking to the lendee… fdcpa guidelines), don’t know what it is but it sounds fishy. If you do talk to this person DO NOT give out any personal information, and inform family/friends not to give out theirs. Given that you are going through a divorce my best guess (and it is only that), is that it is a private investigator from your former significant other. Best of luck.

Question: Are there any legitimate payday loan companies online that will not keep directing me to other sites?
I’m so sick of filling out information to get a payday loan. I don’t have a choice but I need money to pay my rent, I understand everything that comes along with the loans, but are there any legitimate sites that will give me a payday loan and not keep sending me to different sites that direct me to another site?

Answer: Nope, that’s their gimmick. Keep you filling out applications, putting your sensitive info in over and over…

I would keep an eye on your bank account if you gave any of those numbers to anyone… you may actually get CHARGED for applying!

If you are hell bent on getting a payday loan, do yourself a favor, and go to one you can actually walk into and talk to a human behind the counter.

Question: How do I stop a wage assignment from a payday loan company?
I have some payday loan company’s that want to assign my wages how do I stop it? A friend told me about sending them a letter to revoke my signature on the wage assignments but is that paper legal?

Answer: Theses types of wage assignments are not legal in some states….. only government entities can attach a wage assignment for like student loans, unemployment over payments, child support, etc.

Internet payday lenders most generally cannot pursue you legally for defaulting unless they are licensed to do business in YOUR state.

The only way that they can try to assign your wages, is if the contract you signed with them has a clause that you agreed to a “voluntary” wage assignments”

Question: Do payday loan lenders file criminal or civil charges if you default on a loan?
I took out a payday loan and have defaulted because my bank account is overdrawn. They are leaving voicemails stating it is going to the legal department and to court. Is this a criminal matter or civil as in they can only sue me, or can I be in criminal trouble for defaulting on a loan?

Answer: Defaulting on a payday loan is not a crime and can’t result in any criminal charges. If fraud is used to take out the loan, the individual can be prosecuted for that–but otherwise, such debt-related issues are not considered to be a criminal matter in the United States. They can, however, sue you in civil court.

Question: If you have paid more interest then you borrowed on a payday loan do you have to continue to pay the loan?
My husband got a payday loan back in February and he pay $236.00 every two weeks and that does not go to the principal. Once he has paid more then the loan in interest does still have to pay the loan?

Answer: Yes, the principal is still due. Interest is a fee which is charged for the service, it is due in addition to the principal.

Question: I had a payday loan and am now being threatened with “involuntary collections”, what are those?
I took out a payday loan and my fiance lost his job afterwards. I haven’t paid the loan for the last three months because every amount I offer that I can afford to pay, they will not accept as a payment arrangement. They are now saying they are sending me to the legal department for “involuntary collections”. When I specifically asked what that entails, the man told me he wasn’t allowed to say because of collection practices. What do “involuntary collections” mean?

Answer: It means they get a judgment against you and have your check garnished or take it from your bank account or in some cases they can take property from you.

Question: Anyone know how to get out of the payday loan trap?
I live in FL, 22, work full time. I loaned money to my brother and over-extended myself and am needing help now. My credit score is around 600 and can’t seem to get a loan for around 1500 to get my out of this mess. Any ideas would be awesome!

Answer: Here’s what you will have for options:

First, you can find a part time gig, make a little extra money, and just pay it out that way.

Second, call your brother, explain the mess that he has put you into, and see if he will repay.

Third, Call the payday loan place, and let them know what you have and can re-pay. Ask them if they will be kind enough to let you pay this out over a month or two. Yes, this is last for a reason. That 1,000% interest rate they have, will let you pay them out over a month or two, but you will pay more.

Question: Where can I find instant faxless loan payday?
Every payday loan company rejected me. I just need to loan 700 to pay for my bills, could you recommend me some I want easy approved instant loan with no fax request.

Answer: If “every payday loan company” rejected you, what makes you think you are going to find one? There is a reason you are being rejected. Do you have a job?

Types of Life Insurance Policies

June 22nd, 2010  / Author: Canada Money Guru

Life insurance is one of the most important investments a person can make. This type of insurance gives people a way to provide for their families once they have passed. They can help their family by paying off outstanding bills such as a mortgage or credit card bills. A well, it can provide for the children’s educational future.

There are many different types of life insurance policies available on the market. Before you select a insurance policy, you should be aware of the different types.

The following is a list of the different types of life insurance policies:

Term Insurance: Term life provides a death benefit for only a specified period of time. If one dies during the coverage period, the beneficiary will collect the death benefit. If a person lives beyond the set term period, the coverage will end and the policyholder will not get any of the money back. The number of years of coverage can range from one to thirty. Term life insurance is the most affordable insurance choice for young and healthy people. It is important to remember that if the policy expires and you want to renew, you will have to pay a higher premium because you will be much older, and maybe even have some health problems.

Whole Insurance: This type of insurance contains a fixed premium and is considered the most simple permanent life insurance policy. The premiums are paid once each year. It has a savings element that earns cash value. When making premium payments, one will pay more than is required to cover the current costs of insurance coverage. The surplus payment is put in a cash value account. The policyholder has no say in where the money is invested. Whole life insurance will remain intact for as long as the person is alive.

Universal Insurance: With this type of insurance, reducing or increasing premiums will effect the growth of the cash value element and maybe even the death benefit.

It allows the policyholder to transfer funds between the insurance and savings parts of the policy. The Premium rates are flexible.

Variable Insurance: This policy gives the policyholder control over how often and how much the premium payments will be. There is no guaranteed minimum cash value or death benefit. As well, this type of policy gives the policyholders control over where their savings are invested. This policy contains a number of investment choices called sub-accounts which are managed by professionals. If the cash value account goes over a specific amount, the death benefit will increase. Premiums with this policy are fixed.

Universal Variable Life: With this type of policy, the flexibility of universal life is combined with the investment control of variable life. The amount of the final death benefit and cash value depends on investment performance.

No matter which life insurance policy you choose, you get to decide how it can be used to help loved ones after you have passed. Understanding what types of insurance policies are available will go a long way in ensuring your loved one’s future will be sustained.

Full service brokerage offers corporate and personal insurance solutions. When looking for the best protection and information on Car insurance Whitby, Home Insurance, Life Insurance Whitby options.

Life Insurance FAQ:

Question: Life Insurance?
My father decided to buy life insurance on me and my daughter. I’m 21 and I’ve been married for 3 years and I was wondering if he bought it, would my husband be able to buy it for me too? I’m really confused to why my father decided to buy it for me.

Answer: Yes. Anyone who you give permission to, who has an insurable interest, can buy life insurance on you. There’s no “limit” to the number of policies you can have.

Question: What type of life insurance policy does the military offer?
I’m talking about the Army, in particular. Is it term life insurance, or permanent life insurance?

Answer: SGLI is considered term life insurance, since it only covers active duty service members during the period of active duty. It can be converted to VGLI, which is permanent life insurance.

Question: What is the difference between ordinary life insurance and term insurance?
I heard about “term insurance” whose meaning is not clear to me. Can anybody please explain what is the difference between ordinary life insurance and a term insurance? What are the advantages and disadvantages of the two?

Answer: Term Life Insurance provides death benefit protection for a specified period of time. Term life insurance is a good choice if you are young, can’t afford the much-higher costs of whole life insurance, and have financial obligations that will disappear in time, such as a car loan or mortgage.

Whole Life (Ordinary Life) Insurance provides protection for your entire life. The premiums are much higher than for term insurance, and they are stretched out over a period of time. Once your policy is paid up, the insurance company invests excess dollars for you. In addition to providing protection, the policy becomes part of your savings plan.

An ordinary life insurance policy is a combination of a term insurance policy and a “savings account.” The policy owner pays a level premium, which is usually higher in the early years, and excess amounts are used to fund the savings account (also known as the cash value). Ordinary life insurance allows the policy owner to choose one of the following options, even if the insured doesn’t die.

-receive some of the premium back in the form of a low-cost policy loan
-surrender the policy for cash
-receive a reduced life insurance benefit at death
-continue the current life insurance benefit for a reduced time period

Question: What does it mean when your life insurance company asks for a claim form?
My dad passed away, my mom has sent in all the paperwork the life insurance company asked for. Now they are requesting additional info.. They say they need a claim form.Can anyone tell me what this means?

Answer: The person from the insurance company who’s asking for this additional information can probably tell you exactly what this means. Ask them what it is they want.

Question: Does life insurance cover someone who has been murdered while serving a prison sentence?
And what about the distribution of the proceeds of that life insurance if he is covered? Should some go to the victims of his crime as compensation? And also, if someone is proven guilty of another crime after his death, does that effect the distribution of his other assets–should his victims get some of this if they have suffered sufficiently from the crime?

Answer: Whether life insurance would be paid on a murder depends on the terms of the insurance. As to whether there would be money going to victims, that depends on any civil case against him and the terms of the insurance. If he has a named beneficiary to his insurance, the money goes to them, it does NOT go to his estate. If there is no beneficiary named, then his estate claims the money. If victims have a civil judgment against him, they will have access to the money. It is not automatic, and would only apply if there were a standing judgment against the criminal. Future victims found would not benefit. Once the money was distributed, presumably before another claim could develop, it is gone.

Question: What life insurance should I get for my mom?
I am 18 and have a steady income, it’s not a whole bunch but it is steady. My mom does not have life insurance, and says she can’t afford it. I have decided maybe I should get her some and I heard there is life insurance where I can pay between $20-70 a month. Is this true? Where do I look and start, and what company do you suggest?

Answer: Yes, you can talk to a life insurance agent/broker to learn more. Google one in your area.

However, is there a reason that your mom needs life insurance. Life insurance does not help her, it helps her heirs. If all her children are grown and supporting themselves there is little need for there to be life insurance on her. You may want to have a small funeral policy on her, to cover any funeral expenses.

If she will be responsible for your funeral expenses in the event that you pass away prematurely, you should either make sure you have enough money saved for that or have a small life insurance policy on yourself.

Remember, debt dies with the deceased, unless there is a joint account. Or the reason for the debt continues to be needed after the person dies (for example: a mortgage or car loan that someone else wants to keep the property).

Question: What is the difference between whole life and term life insurance policies?
My husband wants to take out an insurance policy on himself for our family due to the fact that he is the primary source of income. We have been researching life insurance policies..what is the difference between whole and term life? My husband is 8 years older than me so he wants to make sure that myself and our children are taken care of in the event of his death.

Answer: Term life insurance is just like car insurance. If you have a claim the insurance company pays and if you don’t your money is gone. The life insurance is just there in case you die.

Whole life is more expensive and has a savings portion called cash value. It is NOT an investment and should not be used for that purpose.

Term is cheap and whole life is not.

Question: Where can I get good life insurance with heart disease 3 years ago?
I had open heart surgery in 2006 and I need some affordable life insurance.

Answer: Surgery three years ago would probably not be sufficient cause for a decline, but it will likely eliminate any possibility of preferred rates. As long as you are relatively young and healthy, and the surgery was successful in correcting your condition, you should have little problem getting underwritten by any carrier.

How Living Within Your Means Can Make Life More Enjoyable

June 8th, 2010  / Author: Canada Money Guru

With the recent downturn in the economy, many people are realizing that they cannot afford to sustain the lifestyle that they have grown accustomed to living. Fortunately, this does not mean life cannot be enjoyable. There are a number of easy ways to live within your means without hurting your quality of life. With a little planning and knowledge you can live on budget without feeling the financial strain.

The following are a number of ways to live within your means while making life more enjoyable:

1. In order to live within your means, you have to be able to bring in more money than you are spending. Create a monthly budget that includes how much you spend on essential items such as home and vehicle insurance, utilities, food, cable, phone, mortgage payments, gas, etc. Then, calculate how much you earn monthly. Subtract your monthly income from necessary expenses to determine how much extra money you have to work with.

2. List extra expenses such as entertainment, recreation, and products you shop for in the home and on yourself such as clothing, personal care products, etc. Calculate how much you spend monthly on these items. You will then need to come up with ways to control your spending habits. This can include cutting down on the number of times you dine out each month, shopping for discounts at large department stores, second hand stores, surplus stores, etc. When shopping, look for deals, coupons, and sales. Never pay full price for an item. As well, you can often find great deals when shopping online.

3. Credit card debt is a major source of financial hardship. If you have several credit cards with high outstanding debt, you should at least pay the monthly minimum for each card, and then start to pay off the card with the highest interest rate. Owning fewer credit cards will make it easier to manage and remember. Always pay your bills on time to avoid having to pay any interest at all. To help wean yourself off of credit cards, start carrying cash with you at all times and pay using cash. Seeing the physical money literally change hands will help you consider needs vs. wants on a more regular basis.

4. If you are having trouble keeping up with debt payments, then maybe you should consider consolidating your debt in order to manage it better. Instead of making multiple monthly payments to several creditors, you can consolidate your debt and only need to make a single monthly payment. In addition to helping you get organized, this can also alleviate stress that is often associated with debt.

5. Clean up your credit score. Request a copy of your credit report from one of the following two major credit bureaus: Equifax, or TransUnion. Check it over for any inaccuracies. Look to see what debt is affecting your credit rating and work with a creditor to establish a repayment plan. Don’t ignore your creditors as they will send your debt to a collection agency.

At first, implementing a plan to live within your means can seem very unpleasant. You may miss a few of the luxuries you had grown accustomed to. However, once you get used to the plan, you will find life more enjoyable as you will not longer have the worry of how you are going to pay all of your bills. You may even realize that you are much happier living on a budget.

Adriana Noton is a freelance writer who specializes in providing great financial information for Canadians. When searching online for debt counselling or credit counselling, one of the many resources available is Consolidated Credit; offering a variety of debt counselling services and financial planning tools to help Canadians get their debts under control.

Debt Counselling FAQ:

Question: How to Utilize Christian Debt Counseling?
Can somebody please explain me how to utilize debt counseling?

Answer: They offer consolidation services that help you reduce your interest rate and monthly payment on some of your cards. They charge a monthly service fee when you enroll, and are also paid by your creditors. There are pros and cons to their service like any other debt services out there. There are other debt options out there, and to really get out of debt, you have to make sure you choose a solution that tailors to your needs. The main options out there are consolidation, settlement, and bankruptcy. All of them work, but they do not work for all. Its very important you understand each one from an un-bias source. Typically each company that offers one of those services will only praise their solution and degrade the others.

Question: What are the advantages and disadvantages of debt consolidation?
What is the best debt Counseling and debt consolidation services? Are there any debt or credit card consolidation services that are easy to use and secure and worth the time?

Answer: Debt consolidation can be good if you can get your interest rate below your other cards, which is often feasible since the balance will be higher, then they usually give you a lower rate. It’s never a good idea if you have to pay ANY consolidation fee or have to pay a higher rate.

You need to first examine and change how you manage your debt in particular and your personal finances in general. The biggest challenge of debt refinancing is to not go out and load up with more consumer debt because you have new room in your budget.

Question: I need suggestions on the best debt counseling services available, free or fee based.?
Before I have to file for bankruptcy or the bank forecloses on my home I would like to explore other options available.

Answer: Some options are:

Buy Dave Ramsey’s book, Total Money Makeover. Go through the Financial Peace University (you can go through it online now). It is a great tool for planning your way out of debt and to better habits for the future.

If you are working, chances are your company has some kind of an EAP program (Employees Assistance Program) for help with life’s problems. Mostly they refer people to counseling, but that can include debt counseling services. Whatever debt counseling program they refer you to will be a reputable one, and your benefits plan may cover any costs.

Check with a NFCC credit counseling service. These are legit, non-profit companies offering debt management programs for a nominal fee.

Question: How Does Consumer Credit Counseling or Debt Affect Credit Rating?
I need to know how actually consumer credit counseling actually affect my credit rating.

Answer: Your credit score is affected by two things. Your payments and your debt to income ratio. So, if you have never been late on anything but your debt keeps increasing, then eventually your scroll will start dropping. Many people are so worried about their credit score and would rather drown in debt than have their score affected. This is why many people are against any debt solutions out there. Its like wondering why would any one have a perfect lawn, but the house on it not be live able. There are many debt programs out there that can help get rid of debt, but there are also many scams out there as well. Each as its pros and cons, and honestly not all affect your score. Some actually may help it in the long run. All the debt solutions out there work, but they DO NOT work for all. Meaning, you have to find a solution that is tailored to your circumstances and debt needs.

Question: What does debt relief companies do for me?
Can debt relief services affect my credit if I use them to lower my interest rate?

Answer: Yes they can negatively impact your credit.

Question: Does Chase, Bank of America, and Capital One give credit debt counseling/budgeting?
Like, advice on how to eliminate debt. If so, which ones and is it free?

Answer: I would just call and ask them. Almost all banks can offer debt consolidation if the client qualifies, which is one way to lower those rates and clear that debt.

Question: Where is the best place to go for individual debt counselling?

Answer: I have found that there are a few ways to get help, the CCCS seem a very good company as it is free and they don’t make false promises, national debt line have a good, informative website and your local CAB will help you budget as well.

Question: Can you explain the difference between a Credit Card Debt Relief program and Credit Counseling?
I’m trying to figure out which route to take with my financial situation. Are there any other options for a person who is still current with all payments but on the verge of possible financial ruin?

Answer: With Credit counseling, the credit counseling company works with your creditors to have your interest rates lowered so you can pay off your debt faster. You normally will make one payment to the company and they will distribute it to all your creditors. Usually takes 4-7 years to become debt free.

The Negative to credit counseling is that while your credit score itself will usually not be negatively effected by enrolling in a credit counseling program, your ability to establish new credit, or any use of existing credit for that matter, will be abolished. Throughout the duration of the program, it is unlikely that you will be able to qualify for a home loan, car loan, or any other credit.It is hard to get a loan or credit card during this period. Also, although interest rates are usually (but not always) lowered for consumers in credit counseling programs, the monthly payments typically will stay the same as your minimum payments, and sometimes more. That means, for consumers that are truly struggling or unable to make their minimum monthly credit card payments, this option will not provide cash flow relief.

With Debt Relief, the debt settlement company can help people that are truly struggling with credit card debt, by representing them in negotiations with creditors to secure settlements of anywhere between 40-60% of the amount of debt owed (at time of enrollment). Of the debt relief options, debt settlement is the least expensive, and shortest in length, with most debt settlement programs averaging between 24-48 months in length.

The Negatives to debt relief include negative marks on your credit for up to seven years. Also, most creditors will report the forgiven debt as income and will send you a 1099c form. You have to report this as additional income on your taxes which would increase the amount of taxes you owe on your tax return.

The Best Deal on Foreclosed Homes

June 3rd, 2010  / Author: Canada Money Guru

We often hear of families and businessmen who search for foreclosed homes for them to be able to buy it off in a lower price and sell it off in a much more expensive deal. These are a few of the tactics that real estate gurus do and this is where they are able to make a great deal of money. So why don’t we used this trick for you to be able to close a great deal.

If you are unaware, what are foreclosed homes? Foreclosed homes are homes which are previously owned by people who are not able to meet up with the agreed mortgage loan. Often times these loans, if not most of the times, these loans are with banks and therefore when loans are not paid on time and not kept up to date, they have the right to foreclose the home and sell it off in a lower price just to be able to get back the money that they have given for the previous owners loan.

These foreclosed homes are often times advertised on FSBO listings, bank ads, newspapers and even on the internet. There are several ways for you to find the home that you want. If you are new in the area, there are several dealers that will certainly be aware on where you can find a great deal for a foreclosed home. You can also opt to ask lending companies, mortgage companies and banks, they will surely be glad to share a few information regarding homes that are foreclosed.

So this is the best time to find a great deal of home to purchase; this is because banks are not mean when it comes to selling off real estates. So they have the tendency to sell it off in a much lower price. So if you and your family are on a budget and looking for a home that will suite you, this is the best option. But before you head on to search for that home that you are looking for, you must first consider a few things.

Without a doubt foreclosed homes are cheaper than other homes listed on the FSBO listings and as much as you would just want to close the deal on one, you must make sure that you have looked into the papers and the deal behind the foreclosed home. It is also best to consider the vicinity of the home, though the home may be bought in a very good deal, the area might not be a good one for your family. So be sure to look into every detail first.

When you have chosen the home that you want, you can now approach the dealer or the bank. Ask them regarding the deal and how much is needed to pay off the home. It is best that you be informed regarding the previous deal that was broken between the company and the previous owner for you to avoid such a thing. They may not disclose the name of the previous owner, but they will certainly be able to answer your other query. So don’t be afraid to get to know more about the foreclosed home for you to be able to get a successful and safe foreclosed home deal.

Learn how to sell your own house here: For Sale By Owner

If you’re looking to buy a home from an FSBO listing check here: FSBO Listing

Foreclosed Homes FAQ:

Question: Where can I find a list of foreclosed homes for sale in Ontario Canada?

Answer: There is none. You must go through a real estate broker. A good broker will keep you in the loop

Question: If your home is being foreclosed in B.C, Canada can you remove your appliances?
my parents are having their apartment foreclosed and sold. They have nice appliances they bought and want to move with them. Does any lawyer or someone who knows the law know if they can?

Answer: Yes if they purchased the appliances they can keep them.

Question: Why is it so easy to find foreclosure homes in America, but not in Canada?
Even on Google its possible to now find homes that are foreclosed and for sale, but not in Canada. WHY?

Answer: Foreclosures have been much less prevalent in Canada, as the mortgage rules were never as relaxed as they were in the US. Try searching for Power of Sale houses in Canada.

Question: Where would I find a list of foreclosed homes in canada, specifically newfoundland?
Is there a webpage showing a list of foreclosed homes in canada?

Answer: In Canada they’re referred to as “power of sale” when the bank is forcing the sale to pay off the debts. Working with your real estate agent would be the best way to find this information. Since you’ll need an agent to look at the homes and to draft the offer letter and such anyway, you might as well start off with an agent now – it’s all included in the commission they will get anyway, so might as well use all their services.

Question: Can I sue the ex for unpaid mortgage and condo fees?
The ex and I jointly own a condo – we are both on title, both on the mortgage, both on the condo plan and tax roll, and both on a home equity loan. The ex essentially walked out, and refuses to pay her ‘half’ of these obligations (almost $1200 a month). I will likely pay the amount, because I don’t want the bank to foreclose and ruin my own credit. My plan is to send her a payment demand letter at the beginning of each month, and then when the total reaches over $5000 to take her to court. I know I likely need a lawyer, but what are your thoughts on all this? We are in Canada.

Answer: That’s a solid plan, I’d go with it. Her only recourse would be to file bankruptcy. Make sure she is NOT deducting anything as far as taxes seeing that your paying everything, only you can take any deductions.

Question: If I foreclose on home in michigan, can the lender come after me, garnish wages, in Canada, where I now live?

Answer: If Michigan allows deficiency judgments, certainly.

Question: If I foreclose on my house in the U.S.A. will that affect my credit in Canada?
I have an investment property in the U.S.A. that will need to be refinanced in two years. I currently have an ARM, but will not be able to get the rent to cover the new payments. If I foreclose on this property, will it affect my credit here in Canada? I want to buy more homes in Canada in the near future.

Answer: Probably not. US and Canadian credit doesn’t usually cross over. If the lender has facilities in both countries, though, you might have a problem. Wouldn’t it be better to sell the property rather than just abandon it?

Homeowners Guide – Getting a Good Handle of Your Financial Position

May 31st, 2010  / Author: Canada Money Guru

Gaining financial leverage does not necessarily mean that you need to have a substantial pay package, own a large home or drive a high-end car. The critical aspects of your financial management are your competency and capability to handle your personal finances sensibly so that you are able to live a comfortable life. A comfortable living means that you are able to enjoy healthy environment, eating, adequate shelter and clothing. It is important that you are able to satisfy your needs as well as your wants by having sufficient amount of money. The source of funds to support your kind of lifestyle must come from your earnings and not from borrowings. The core foundation of a good financial management is the development of the right habits in handling personal finances. Proper management of personal finances must be second nature to you.

In order for you to have the necessary finances to support your home improvement project or upgrade, personal finance experts recommend that you start by plugging the leaks of your financial portfolio. This means that you must identify the problem areas and start implementing corrective actions to resolve the issues. These “financial cracks” may have different forms for every family.

The following is a quick rundown of the most important tips that you have to follow in order to “plug” those leaks in your financial portfolio:

1. Gather the basic information about your finances

You need to establish a complete profile of your finances. It is also essential that you get data and information that would cover a specific time range. For instance, you have to get hold of your credit card bills and bank statement for the last six months. As soon as you are able to gather all the information about your expenditures and incomes, the next thing that you must do is to group these items into logical categories. You can perform this task by using your own spreadsheet or choosing one of those spreadsheets that are available online.

2. Sum it all up

As soon as you are able to completely organize the expense items, sum up the items in each of the categories to determine what your financial position is in each of the main expense categories. It is important that you don’t under-estimate your income and expense items.

Here are the major items which you need to carefully assess to ensure that you get an exact measure of your financial position:

• Income source – all sources of income, including your salary, bonuses, rental income and benefits.

• Housing expense – utilities and maintenance, insurance, property taxes, mortgage payments or rents

• Communication – internet, home phone, cell phone

• Entertainment and Leisure – vacation and travel, health clubs dues, liquor and beer

• Children stuff – parties, gifts, lessons, clothing

3. Compute your percentages

Use your NET income as your base figure in analyzing the specific items of your personal finance portfolio. Financial experts recommend that your mortgage or rental payments must not exceed 30% of your net income. Other basic guidelines that you have to follow in managing your cash outflow include 10% of income for compulsory savings, 15% of income for debt servicing and 15% of income for transportation expenses. There may be some aspects of your personal finance where you breach the upper limit. This may be allowed for a few items. However, if you are going beyond the limit in almost all of the expense items, then you really have your work cut out for you.

4. Establish your priorities

Determine which items are more important than the rest. In the event that you need to overhaul your expense items, then it is incumbent upon you to make adjustments or give up items you consider of less importance than the rest of the expense items. In most instances, major adjustments are usually done on items involving recreation and entertainment.

5. Formulate your monthly budget

The last thing that you must do once you are able assess the critical aspects of your personal finance portfolio is to formulate a monthly budget. With the proper handling of your expense items, you will be able to come up with a financial template that achieves a perfect balance between your essential expense items and fun stuff.

Learn how to sell your own house here: For Sale By Owner

If you’re looking to buy a home from an FSBO listing check here: FSBO Listing

Personal Finances FAQ:

Question: What personal finance records should we keep at home or in safety box?
I keep everything at home and a lot of it I did not need, but recently moved and somehow lost most of it. Yes, I certainly do blame myself….How many years of tax returns should we keep and where? ( i can only find 2 yrs back) What documents should we have concerning our home (title, deed of trust, etc). Where and how can I get copies of these docs that I need?

Answer: Personally, I keep all tax records for seven years as well as bank statements. In addition, you should keep copies of wills, powers of attorney (medical and general), life, auto and homeowner’s insurance policies, and an extra key for your home and cars – so you know where it always is. I also have a special section for warranty papers on household items we purchase. You can get copies of your titles and deeds of trust for property from the courthouse in your county of residence, or from the lender if you still owe. Automobile title copies can be purchased from the bureau of motor vehicles.

Question: What is the best personal finance book to start with?
I am 28 years old, single and made $41,000 last year. I am struggling financially due to my own ignorance and need to get a hold of the reigns.

Dave Ramsey and Suze Orman have some pretty mixed reviews on how overly simplistic and what a waste of money their work is and Givens sounds too risky. Where should I start? What do you recommend?

Answer: Try the Idiots and Dummies guides on personal finance / money management. Yes, it’s incredibly simple, but it’s a good foundation, and even financially savvy people can pick up a few tips and refresh themselves on good reminders there.

Then move on to David Bach, David Ramsey, and/or Suze Orman. They all give very similar advice, and it’s all very sound. Maybe not all of it will apply to your situation, but you pick and choose the parts that are relevant to you. Remember, you’re not looking for the hot magic stock tip that will make you instantly rich – you’re looking for practical real-life advice on how to maintain and improve your actual finances.

Don’t expect to go from novice to expert overnight, or expect one book to provide you with all the answer. Read several, then mull it all over and form your own opinion of what is best for you.

Question: How can budgets help people to manage personal finance?

Answer: By first tracking what you are spending and what you are spending it on. Then comparing that to a proven program that outlines what percentage of your income should be used for what expenses. That will balance your finances to eliminate debt and live within your means. The good thing about a budget is that you can adjust it based on your lifestyle as long as it remains balanced.

Question: What are the tools of the trade for personal finance?

Answer: You need a personal life plan, a personal budget and a personal balance sheet. After that you may need some financial coaching or financial therapy to help you get past your human foibles and enable you to use these tools rationally.

Question: Personal finance planning?
I am 25 yrs old, and feel its important to start planning ahead of time, but I don’t know what to do. Should I buy stocks? bonds? mutual fund? All these seem confusing. So then I figure why not look for a professional, and saw the Ameriprise commercial on tv, so my question is would you recommend Ameriprise? If so, how much money should I have before I contact them? What other advice you would have for a starter in personal finance planning?

Answer: 1. First you need an emergency fund of 6-8 months’ living expenses (not income, what you actually need to live). Don’t even think about investing until you have this.

2. Then you need to have your various insurances in line: HO or renters, auto, health, life if you have dependents (none if you don’t), personal liability if you own a home.

3. If you have dependents, you need a simple will. IRAs and 401ks and life insurance pass by beneficiary form, not your will, as do joint assets. But if you own a car in your own name, or have personal property, these pass by will. If you’re single, in most states your parents would inherit. If you’re married, your wife and kids. Do a cheap will online or with Quicken Willmaker, then pay a lawyer for one hour to look over it and make sure it says what you want (not what you think it says). Look for a woman atty, they’re cheaper.

4. Only THEN should you think about investing. Ameriprise is fine, but they are “boiler-plate” and they are really looking for people who can invest. You are probably not at that stage yet. Maximize your 401k contributions before starting an outside investment program.

Read, read, read, before investing. Look online: Investopedia.com, morningstar,com, fidelity,com, vanguard.com–all have educational sections and you don’t have to invest anything to access them. Don’t invest in anything you don’t understand, and don’t invest any money you can’t afford to lose. Once you have funded your emergency fund and 401k, start a personal investment program with $10-15,000. There’s nothing wrong with cash in the bank till then. Good luck! Wanting to save is half the battle.

Question: What is a good book on personal finance?
I want to do a better job managing my money.

Answer: Any book by Suze Orman. I would also watch MSNBC. Here is a tip if you don’t want to spend money on a book, go to your local library and they should and almost always have a section with books full of personal finance information. That way you spend no money and have access to several different ones.

Question: From a tax and personal finance standpoint, why should an employee ALWAYS invest in an employer’s 401k?

Answer: That’s only true if an employer offers you a “match” on the 401(k) plan. Matching funds are extra money that an employer gives you as an incentive to save for retirement. However, when there’s no match, an IRA can be a better choice because you have control over it and there’s more flexibility in your investment choices.

Question: How is a spreadsheet superior to a cash book in keeping and analyzing personal finances?

Answer: A spread sheet is better cause it also allows you to determine taxes and multiple other equations allowing you to figure out your balance even easier than calling the bank.

Explaining the Difference Between Automobile Insurance Rates in Canada

May 31st, 2010  / Author: Canada Money Guru

Drivers can save a decent amount of money by comparing automobile insurance rates in Canada. Finding out what factors affect your insurance and how to shop for coverage is the first step to significant savings.

Research insurance rates over the internet or on the phone. Use search engines to find comparison websites or check out the yellow pages for companies that serve your area. One phone call and less than 20 minutes of your time to answer questions and make a few choices can put you on the path to saving money. Get a firm quotation to really get a handle on how much.

Auto insurance rates change based on you, your car and your location. In a few provinces mandatory insurance is issued through the government, such as in Manitoba. Across the country it is the law that all drivers have adequate coverage for property and liability damage. That coverage must be valid at all times. Insurance companies also sell policies that cover drivers well beyond that minimum amount.

If an Alberta driver who is 49 years old drives a 2004 Toyota Sienna, they can expect to pay as low as $1400 and as high as $1700 for insurance. If that driver moved to Ontario and drove a 1999 vehicle, they would save anywhere from $200 to $300 per year.

Your past driving record and the use of your vehicle will also have an effect on the automobile insurance rates in Canada. Using a car or truck for business will result in more distance driven and a higher insurance policy. Also a bad driving record will drive the cost of insurance up and may cause a provider to cancel your policy or refuse further coverage.

Any time you are refused coverage it will have to be reported on subsequent insurance applications. Also any accidents in the last ten years where you were deemed at fault and any claims will need to be disclosed on future applications. Remember to be up front with your record to obtain the most accurate quotation and the best coverage.

Gender is another factor which may increase your auto insurance rates. Whether male or female, if you have taken a driver training course and can provide proof of it, your rates should decrease.

It would seem that Ontario has the highest automobile insurance rates in Canada. An Ontario driver who’s 23 years old and owns a 2006 Chrysler should pay around $1600 annually, while a Quebec driver who’s 19 years old and owns a 2005 Mazda will pay less than $1100 through the same national insurance company. Although other aspects may have affected that comparison, where you live is an important factor in how high your insurance is.

Setting a higher deductible will decrease your annual policy. Also be sure that you are not carrying any excessive or unnecessary coverage. Go over your policy in detail and choose the highest deductible that you are comfortable with. Remember that the annual savings stay in your pocket every year and the higher cost of the deductible is only relevant when a claim is made.

When shopping wisely for automobile insurance rates in Canada, be honest about your record and understand the coverage offered. That will help you to choose the best policy and obtain the lowest rate.

This reliable car insurance in Ontario dealership offers competitive rates along with exceptional customer service, thus providing the best valued car insurance. You are guaranteed a safe driving experience by entrusting us with your auto insurance in Ontario needs.

Auto Insurance FAQ:

Question: How much for basic auto insurance in Canada?
I am driving my car from BC to Waterloo, ON. back for school. I was wondering, in this case, which province’s auto insurance I am supposed to get. Can I drive around in Ontario for more than four months with ICBC insurance? Or Do I have to get the new Ontario insurance? In BC I am still N, which is equivalent of G2, and I currently drove for closely three years. Another thing was, how much would the basic insurance cost a month? Is there any big difference between BC and Ontario?

Answer: The best answer you’re going to get to all your questions is from your own insurance people. Call them and ask them. Anyone other than them who gives you a price is guessing.

Question: Can I buy US auto insurance to cover my Canada vehicle?
I just moved to Canada this month. I have had Geico auto insurance in US more than 4 years. However, there is no Geico insurance service in Canada. Can I continue to use my US Geico insurance and register my car in Canada?

Answer: Not if you live in Canada. Plus, some provinces have their own auto insurance that you must buy.

Question: Which american auto insurance company covers you if you travel to canada?
I frequently travel to canada on weekends. Which auto insurance company covers you for that travel?

Answer: Unlike Mexico which requires you to buy their insurance, Canada will recognize your current policy as a tourist in their country. If you MOVE to Canada, they give you a grace period which varies by company. Now, call your agent & get a Nonresident Interprovince Canadian ID card. This will be in English & French & will be required if you are ever in an accident or get a ticket.

Question: What is the point in adding an occasional driver on my auto insurance (Ontario, Canada)?
Is there a legal obligation? Is there any impact on the auto rate if that person is young or have been involved in accidents? If the occasional driver gets involved in an accident, will it also be on my record? But what is the difference if the occasional driver gets into an accident if she’s on the policy or not?

Answer: Is there a law that says you have to? No, there isn’t. However every insurer requires that you disclose all licensed drivers in the household as well as regular operators of the vehicle. If you fail to do so, and that person has an accident, then the insurer has grounds to deny any claim filed. This means you (as owner of the vehicle) and/or the driver of the vehicle could be financially responsible for everyone’s damages/injuries, which means you could be in debt for the rest of your life. There is an additional premium charged for an occasional driver who is under 25, however an occasional driver over 25 can change your rating as well depending on how long they’ve been licensed, however the additional premium won’t be as much as having an occasional driver under 25.

To answer your second question: regardless of whether or not the person driving is a listed driver on your policy, if that person has an accident which is their fault (even partially), then it will affect your rating. The difference between having them listed and not having them listed is by not having them listed you’re running the risk of not having the claim paid.

Question: When is Geico going to offer auto insurance in Canada so I can switch?

Answer: Why would they? There are several hundred insurance companies in Canada already. Have you any idea how much it would cost them to set up and be licenced in Canada, in each province they wanted to deal in?

Question: Cheap Auto Insurance Ontario Canada!?
I am a 20 year old Female driver. I have never been insured before and looking to buy my first car. Are there any sites where I can get quotes? I am from Hamilton Ontario Canada. I have been in two at fault accidents in the past 4 years.

Answer: With two at-fault accidents you only qualify for three companies: Perth Insurance, Jevco Insurance and the Facility Association. The Facility Association is the insurer of last resort in Ontario, and they’ll insure someone when no one else will. None of these companies will quote you online, you have to call an insurance broker in Hamilton to get a quote with these companies (yes this means actually having to talk to a real human being). I work with all three companies and I quickly ran some numbers through my rating software. Unfortunately I don’t know: the exact date of the accidents; how many years you’ve been licensed; the vehicle you have or where your exact location in Hamilton is; however if one of the accidents occurred within the last year and you had a 1990 Chevrolet Cavalier, Jevco turns out to be the cheapest of $6,100 for minimum coverages. This is not an exact figure, but it will give you an idea. Contact a local insurance broker for more exact figures.

Question: Teen having major trouble getting auto insurance in Toronto, Canada?
It was about 3 years ago today that I started to save up for the car of my dreams. I saved up, with MY money earned from working, not given to me by my parents, and I’m not some rich kid either. I call the insurance company and they quote me for $550.00 WTF?! What are my options? This is disgusting to be honest.

Answer: Your options are: to pay for the insurance; shop around (you might be able to find an insurer who will insure for a few bucks per month less); not drive. You should have factored in ALL the costs associated with vehicle ownership before buying a vehicle, not just the obvious one. Insurance for 18 year olds, especially males, is expensive. If you’re paying cash for the vehicle you can always decide not to take collision and comprehensive coverage, however depending on the vehicle this will not make a huge difference (maybe $50-$75/month less).

Question: What do Americans pay for auto insurance?
From 19 years old; with a bad driving record; to 40 year old with good driving records. What kind of numbers are out there? In Canada, I pay $100 a month for my older truck. I have a good driving record. That can go up to $200 for a new car and an average driving record.

Answer: When I was 18 I bought a z28 Camaro and I had one speeding ticket. My insurance, on my own policy, was $225/mo and that was more than anyone I’ve run across since then. Now that I’m 30, my wife and I insure two cars for only $100/mo.

Tax Season – Ways You Can Spend Your Returns

April 15th, 2010  / Author: Canada Money Guru

For most people, tax season can be a dreadful time. The new changes in the tax code and trying to make sure you have all of the essential items such as important documents and receipts can make the tax filing process very frustrating and time consuming. Most experts say that you can make the filing process much easier if you take the time to prepare instead of waiting until the very last minute. However, there is a light at the end of the tunnel. The average tax refund that Canadians receive is approximately $1,400.

Many Canadians will use that money to go on a holiday or have a shopping spree; however, there are many other ways that you can put your tax refund to use. Your tax refund can help you get ahead with your personal finances.

Here are several, useful things you can do with your tax refund.

1. Invest it
Why not put the money you just got back and invest it on your own future? Invest it into your mutual funds, or put it away into your retirement fund. Grow a nest egg that you can enjoy when you finally go into your well deserved retirement.

2. Pay Off Debts
Owing money to creditors can bring a lot of unwanted stress and pressure. Use your tax refund to pay off debts and get your finances back in order. Even if the money isn’t enough to clear all your debts, the money will reduce the principal and bring you that much closer to being debt free.

3. University Fund
It’s never too early to start saving for your children’s education. Put it away into an RESP. With the rising costs of tuition, this may be one of the smartest moves you’re doing to secure a bright future for them. In addition, it’s a valuable lesson for your kids to plan ahead. As a result, when they find out they have a nice fund waiting for them to complete their education; they can focus on what’s important, learning.

4. Home Improvement
Have you been waiting for the right time to do that perfect renovation? Why not spend your return on improving your home? You can renovate your kitchen, change the bathroom, even change the overall theme of your house! This is a great way to breathe new life into your home, while increasing its value.

5. Save it.
If all else fails, you can always first put it into a savings account, and worry about it later. At the very least, it will still earn some interest (even if it is at historical lows), and in the long run, compound interest will take its effect.

The number one reason why people file their taxes in the first place is so they can get their tax returns. Use the windfall to pay off some debt, save it for the future, or even dabble in some investing. This money is yours to spend as you will; however, using it wisely can help towards gaining greater financial stability.

Adriana Noton is a freelance writer who writes on a variety of financial topics including credit card debt. For more information about personal finance and credit counselling, ConsolidatedCredit.ca is a tremendous resource on the topic for Canadians.

Taxes FAQ:

Question: Providing childcare and paying taxes in Canada?
If you provide childcare from your home, how do you pay in your cpp or EI or do you even have to? Or do you end up having to pay in during income tax season? Also if I were to do childcare from home and was considered self employed, if I were to have another child would I still be able to get Maternity leave or EI?

Answer: If you provide day from your home you are considered self-employed and would only have to pay CPP and taxes if any. You would not pay into EI and so would not be able to collect EI.
The government has changed this for EI where self-employed can also pay into EI if they want. You would have to look at what it cost, to see if is worth it.

Question: Canadian Tax Season?
I’m new to Canada and have the following questions:

1. What are the dates for the Canadian Tax Season (I know it ends April 30th for those with employers and June 15th for self-employed folks, but when is the deadline to receive your T4? Is it the end of February?)

2. A person receives a T4 from their employer and files a T1? Is this correct?

3. What do corporations and sole proprietorships receive and file (i.e equivalents of T1s and T4s)?

Answer: 1. T4s due to be mailed: Feb 29th. T5′s due end of March. Payment of the balance owing (above the installments for self-employed people) is due April 30th as well; it is just the return that can wait until June 15th.

2. Yes

3. A corporation doesn’t receive anything, they prepare their financial statements and file a T2. Along with the T2 are a number of schedules that they use to report various things as well as bringing their accounting income to taxable income.

For a sole proprietor, they too prepare their financial statements and transfer these amounts to a T2124 (statement of business operations or professional operations). This then gets reported through the T1 (individual) return that they would file.

Question: Leaving Canada on Feb, 11th, is there any way I can get my tax return from 2009?
I worked for a company in Canada the entire year 2009. Now I am going back to my country since my work permit gets expired on Feb 11th, 2010. But I really want to get my tax return back before I go back because I paid pretty big taxes about $5,000. But I have no idea of how to get it back, the problem is, people say tax season is between February and April and I am going back in the early of February, so I have no idea what to do.

Answer: Check with your employer for the T4 slip (W2 equivalent in Canada). You can then visit H&R Block or some other preparer that gives instant cash back. If the employer won’t have your T4 in time (Feb 28 is the deadline) you can use the amounts from your last pay stub if their aren’t any taxable benefits but I don’t think they will do the cash back without the actual T4 slip. You can file from out of the country if needed.

Question: Canadian Citizen working on OPT, do I file US or Canadian tax return?
I just graduated in May 2009 from a University in Connecticut. I am originally from Canada, but I am currently work in NY state on OPT (Optional Practical Training). The company I work for is going to sponsor me for a TN-1 Visa come May 2010, when my OPT expires. I want to know what I have to do come tax season? Do I file both US and Canada Tax returns? Or just one?

Answer: You file in the country you are residing. Since you are residing in the US and not Canada, you will file US tax return. (Residing means that you are living there for 6 months or more for tax purposes).

Question: When do I need a tax lawyer versus needing an accountant?
Tax lawyers and accountants can both be helpful allies during tax season. But what is the difference between them? When would a person consult one over the other?

Answer: Accountants can help you prepare tax returns and plan strategies to pay less tax. But if you find yourself facing an audit, a reassessment or an investigation by the CRA and want to fight it effectively, you need the legal and confidential protection of a tax lawyer.

Question: It’s Tax Season, What else can I claim?
I just received my T4 Tax slip so I am planning on filing my taxes very soon. Now I know I can claim Rent, Medical bills and Charity receipts. Is there anything else I can claim to maybe get a bigger refund? Does it make a difference if common law?

Answer: The hydro and gas bills can only be claimed if you use a portion of your dwelling in order to earn income. Same for the expenses for your car. In order to verify, your employer would be required to fill in a form T2200 and give it to you for your records.

The claim for rent will be affected by your marital status. When married or common-law, the claim for rent can only be done by one of you, and the calculation will involve the combined amount for your incomes.

Question: I didn’t do my last year taxes but I need to have done them to apply for subsidy?
Is there any way to do them before tax season next year? When is it by the way? I don’t know how it works I’m in Ontario Canada.

Answer: You can file a past-due tax return at any time, as long as it is within 10 years from the date. CRA will likely arbitrarily assess you before the 10 year period is up, meaning they estimate your return based on the information that was provided to them from your employer(s), etc.

You can order the forms yourself at www.cra.gc.ca, or go to any accounting firm or tax preparation office; most are open year-round.

Question: Questions about Canada?
My questions:

What are the seasons like?
Is the cost of living high or low?
Healthcare?
Taxes?

Answer: Seasons
Depends on the area you’re talking about. Canada has many geographies and climates across the country… some seasons are very “pronounced” others take place at different times in different parts of the country.

Cost of Living
Again, that depends on where you’re going. It’s generally similar to the US, maybe a little higher cost of living in some parts. But that’s like the US in that respect too… it costs more to live in Toronto that it does in Saskatoon, for example.

Health Care
I’ve never had a problem with it. It varies from Province to Province, since health is in Provincial jurisdiction. For more information, look up each Province’s health care system.

Taxes
Typically Canadian taxes are higher than their American counterparts, but not as high as their European counterparts. Different Provincial tax rates really effect things. For example.. I’m in Alberta, we don’t pay PST or many of the taxes our neighbours do.

How the New Mortgage Rules Affect House Prices

April 12th, 2010  / Author: Canada Money Guru

On Tuesday February 16th, 2010, Canada’s Finance Minister, Jim Flaherty, announced that the Government will be changing Canada’s mortgage regulations in effort to prevent potential mortgage borrowers from acquiring mortgages that they cannot afford. Due to the increasing concerns about consumers being attracted to low mortgage interest rates, especially borrowers who are securing variable-rate mortgages starting at very low levels, there are worries that many mortgage holders may not be able to afford the monthly mortgage payments which could result in a housing bubble. Flaherty announced that the Government will be implementing tougher restrictions regarding how banks go about approving mortgages. For people looking to purchase a new home, it is important to understand how the government mandated mortgage rules will affect home prices.

The goal of the new mortgage rules is to make sure borrowers are not taking on more debt that they can manage. Many experts believe that in the next couple of years home prices are likely to decrease thereby increasing the need for stricter mortgage regulations. Many economists note that the recent low home prices and low interest rates are eventually going to increase, but these new rules basically ensure the likelihood that the lower house prices will continue into 2011. In the coming weeks, it is expected that many people will hurry to acquire a mortgage before the rules kick in as the date the regulations come into effect is April 19th, 2010. After that, the housing boom will likely slow down as the market adjusts.

If you are in the market for a new home, this may be a good time to acquire a mortgage. It is important to remember that interest rates will eventually increase so you should create a long term financially stable mortgage repayment plan, especially if you have an adjustable interest rate. For instance, if you get an adjustable mortgage rate at 2% and in two years it rises to about 5.5%, this will cause a drastic increase in your monthly mortgage repayments. If possible, many real estate experts recommend a fixed rate mortgage with a larger down payment so that you will not be negatively impacted when rates increase.

The recent economic crisis has resulted in Government intervention in order to make sure the housing market does not crash. As the housing market stabilizes, home prices will eventually begin to rise. As well, as the economy rebounds, the current low prices being offered on many homes throughout Canada will not last. If you plan to purchase a home after April 19th 2010, it may be more difficulty to secure a mortgage as you will have to meet criteria that includes: a minimum down payment of 20 per cent will be mandatory for government-backed insurance property, the maximum you will be able to withdraw when refinancing your mortgage will be 90 per cent of the property’s value, and you will have to meet specific qualifying criteria for a five-year fixed rate mortgage.

If you have a secure job, good credit rating, and can afford the monthly mortgage repayments even when interest rates rise, this may be a good time to purchase a new home before the new mortgage rules become compulsory.

Analysts are expecting mortgage rates to rise and GIC rates to drop within the upcoming year. Read more about it on our blog.

Canada Mortgages FAQ:

Question: Why does mortgage payment history not appear on credit reports?
Curious – my Canadian mortgage does not appear on my credit report. I contacted the mortgage company, and they said they do not report, nor do most other mortgage companies in Canada. Surely, with a mortgage being the biggest thing we buy, our good payment history should be recorded? I’d imagine they would be quick to report any delinquent payments or foreclosures!

Answer: In Canada your mortgage history does not appear on your credit bureau unless it is setup as a line of credit. This shows up as a revolving credit line that is tied to the value of your property. Basically think of it as a large credit card but your house is the asset.
Your good payment history with a mortgage is shown when some lender may ask for a mortgage rating or current mortgage statement.
In most cases if your payments are going to be late on something, I’ve found that the last thing people want to be late on is their mortgages. People let credit card payments or loan payments slide or be late but most of the time unless things are in real trouble, your mortgage is usually the last thing you will be late on.

Question: How do I increase my Mortgage payments if the bank my mortgage is with is different from my regular bank?
If my regular day to day bank is though TD Canada Trust but my Mortgage is with Scotia Bank do I have to call someone to request doubling up on payment etc.

Answer: Register your account on the Scotia Bank website. The site will take you through the steps to pay your mortgage online electronically via your regular bank. If you have trouble registering your account, call the contact number listed on the website.

When online, you can make extra payments if you wish. Most banks also allow you to specify how to direct your extra payments, whether you wish to apply it to the principle of the loan or the escrow account.

Question: Can I file a quick/quit claim deed to remove my name from my parents house and can I do this from Canada?
My parents aged 55 and 60 are looking to release equity from their home using a life mortgage, so I need to be off the title, as the youngest applicant needs to be at least 55.

I am living in Canada now and my parents are in London.

Answer: The true answer here is that your parents will have to either call or visit the local municipality where the deed will be recorded and ask a very simple question, which is, what will they accept. The recorder of the deed will have the final say as to what they will accept to record the deed. With you being out of country, they may require you to actually show up at a consulate or embassy to get an official seal put on the deed. Make sure your parents tell whomever they ask specifically that you are in Canada getting a deed notarized and if the Canadian notarization will be sufficient to get the deed officially on record

Question: How to get ex to take over mortgage, she is not willing?
handed over the house, completely hers and she will not take my name off the mortgage. Can I force her to sell, can I stop paying the mortgage and let the bank take the house from her? There is a fair bit of equity in the house so the bank will get all of their money if they foreclose. And how many payments do I have to miss before they actually foreclose on the property? We are in Ontario, Canada. My lawyer was crap!

Answer: Those issues should have been settled with the divorce. My ex had to sign over a quit claim deed, but I couldn’t get his name removed from the mortgage until I refinanced. Banks don’t have to release you from the mortgage.

Question: Can I claim the mortgage interest in my tax return?
I’m in Ontario, Canada. I also want to know if I can claim the home and car insurance as an expenses. My main income is from rental properties.

Answer: It all depends, are you renting some or all of the house. If you are renting some or all you can claim part of the amount you are renting out (20%, 30%, 50% or 100%) you get the idea. If you are not renting out any portion of the house then mortgage interest on a principal residence is not a tax deduction in Canada.

As for the car if you have more than one rental unit in more than one location you could claim a part of the expenses on the car.

You may want to check out the CRA site, it should answer all your questions.

Question: If my mortgage is a variable rate, that is .9 below prime, should I look into locking into a fixed rate with?
Are rates soon to rise in Canada?

Answer: Variable rates are always a risk. Get fixed asap.

Question: Do I get a GST refund for being a first time home owner this year?
I really could do with it to be honest but I don’t know. I’m so new at all this. We live in b.c. Canada.

We bought our rented home. The mortgage is 340,000. We got it January 31 of 2010. Do we get any money back when we do our taxes? How do we find out?

Answer: Did you pay GST? GST is only is charged on new homes. If you were charged usually the builder is a registrant and he can get rebated. If you and your partner have not owned a home in the Five years prior to the purchase than next year you can claim the Home Buyers Tax Credit.

Question: Military draft In Canada?
What happens to an individual’s financial obligations (Mortgage Payments,Court Payments,Debts) if there is a military Draft in Canada? Because he/she will be called up, who will pay or take care of the financial obligations?

Answer: There has never been a military draft in Canada and it is anticipated that there never will be. We’ve never needed it before as Canadians have always answered the call of their Nation.

As far as IF there ever was one, the individual is still responsible for their personal debts. When a soldier is drafted they would be paid the wage appropriate to their rank and that is what they have to make due with. It remains an individual responsibility.

College Grants For Single Mothers in Canada

March 25th, 2010  / Author: Canada Money Guru

Every country will agree to the fact that the women require adequate education to move ahead in life, especially the mothers. Single mothers have special needs as they are the only support to their family and kids. Money, time and confidence are three obstacles in their path to acquire education. Canada, like any other country, has identified these problems and hence, has started college grants for single mothers in Canada.

The Canadian government realizes the problems faced by single mothers and has started various grants to help the mothers cope with the problems by providing required education for them. Like in the United States, to apply for federal grants in Canada, one needs to apply it through the FAFSA centre. The FAFSA is an online centre set up for receiving the applications for the federal and state grants. The applicants usually need to submit their previous year’s tax records as it is the eligibility criterion for receiving the grants.

The latest feature regarding the college grants for single mothers is the Canada Student Grants program (CSGP) which has clubbed the various federal student grants into a single program and is earnestly trying to reach out to single mothers who like to pursue their studies. This new program helped 245,000 students in the academic year 2009-2010 and is very easy to apply for. Some of the grants under this program have been listed below:

1) Canada Student Grant for Persons from Low-Income Families: This grant provides $250 per month to students of low-income household who also are eligible for a federal student loan, and is available to undergraduate and college school program.

2) Canada Student Grant for Persons from Middle-Income Families: As the name suggests, this is granted to a middle-income class student also qualifying for a federal loan. The selected student will receive $100 per month of study.

3) Canada Student Grant for Persons with Permanent Disabilities: This grant is only for those students who are handicapped or crippled. The state offers $2000 every academic year for these students to cover their education costs and tuitions.

4) Canada Student Grant for Services and Equipment for Persons with Permanent Disabilities: Those handicapped students who face exclusive expenses for interpreters or tutors are provided $8000 annually from the state.

5) Canada Student Grant for Persons with Dependents: This grant is exclusive for mothers. $200 per month of study is provided to them for each child which they have under 12 years of age.

6) Canada Student Grant for Part-Time Students with Dependents: This is for single mothers who are pursuing part-time education. For every child under 12 years of age, the single mother is entitled to $40 per week of study. Single mothers with three or more children are entitled for $60 per week.

7) Canada Student Grant for Part-Time Studies: This scholarship is only for part-time students. The state grants up to $1200 per school year for the eligible part-time students.

The Government of Canada is very keen on its CSGP and realizes the marked changes this program has brought about in the lives of the deserving students, who are only held back due to the financial crisis. College grants for single mothers in Canada is becoming a reality and this can observed from the improved lives of the mothers.

Many places offer scholarships just for being in a specific group. Take just a few minutes to get a scholarship just for being a mother. That’s $10,000 that does not have to be paid back. Here it is, Scholarship for Mothers and it’s free.

Government Grants FAQ:

Question: Can Americans Get Student Grants or Student Aid in Canada?
I’m American, wanting to go to college in Canada so that I can be closer to my boyfriend. Will I be able to get a grand or student aid in Canada since I’m American? I’ve also heard that if I applied for a United States Government grant that I could use it at a Canadian school. Is this true?

Answer: While you cannot get Canadian student aid, you can indeed get US government aid for most Canadian schools.

Question: Is there any grants for single moms in Canada?

Answer: There is a grant called the Canada Study grant for students with dependants, you will most likely get one if you qualify for a Canada student loan

Ask at your financial aid office too, they may not have grants specifically for single moms, but they may put you into whats called a special consideration class, which means you have more priority than say a single student.

Also check out studentwards.com they have info on a lot of scholarships and grants including for single moms

Question: Single mom in Canada needs money to pay for tuition to finish degree?
I need to find a grant for tuition and books to finish my degree at university of Victoria in Canada. Don’t qualify for student loans. Very determined. Any suggestions or info on grant opportunities?

Answer: Why not try and see if there are any national helplines for education in Canada that you can try. I would also be contacting the University you attend and see if they can put you in touch with a student advisor who can help you.

Question: Grants for single mothers going to school in Canada?
I am a single mom and I want to go back to school very soon. I am struggling just to get by at the moment and I will need a great deal of help to get through schooling. I am currently living in Calgary, Ab but will be moving to Thunder Bay, Ont at the end of April.

Answer: Check out OSAP (Ontario Student Aid Program). You have to apply for a loan first and you will automatically be considered for a grant. You should contact the financial aid advisor in Thunder Bay and they can help you out the best. There also may be bursaries at the school.

Question: How can I get a loan for university?
I am a Canadian student and I want to go to university in America. My marks are great, but I’m the child of a single mother and we’re very poor. I heard that the Canadian government will not grant a large loan for a student that will not study in Canada. Furthermore, a bank will probably not grant me a loan since I do not have any credit history whatsoever.
I do not want to give up on a dream. Help!

Answer: My advice is to speak with a financial aid advisor from the University you would like to attend. The best advice is to not get a loan through some private company because they have terrible interest rates. Even if you have no credit, an advisor will tell you the best option. Most college students have little or no credit, so they are in a similar boat. There are other options, and the college should be working with you to find out the best option to pay for your future education.

Question: Can you get any grants/financial aid at university when you have a baby?
I’m 17, graduated from high school and 6 months pregnant, and I’m going to university in September. I live on my own and get no financial support from my parents. Is there a way to get my tuition fees lowered, or get a discount of some sort at the university? I’ve heard that young mothers can get special grants, but I’m not sure how it works. I live in and will be going to school in Ontario, Canada.

Answer: You can apply for OSAP. There is a clause that asks how many people you have dependent on you, which basically means if you have kids, or possibly parents you care for, and that will determine how much of a loan you can get. Also talk to your school about scholarships and bursaries, they are available for people in lots of different situations. Look into a joint daycare program with your school, some have that as well.

Question: Going to School in Canada can I use Pell Grant?
University of Winnipeg is listed in FAFSA school code lookup and I want to go to school there, but can I use my Pell Grant money? I know they take Stafford loans and the Admission office says they work with all forms of US Finacial Aid, but I don’t think they know what they’re talking about because I’m getting mixed reports online for US needs based grants for out of Country Schools. I am having a hard time getting in touch with the Financial Aid office and I need to know this information now.

Answer: If the school has a federal school code then yes, you can use USA federal financial aid to attend. This includes the Pell grant and stafford loans and such. Just be aware that not everyone qualifies for the Pell grant. You have to be pretty low income to qualify for it. And since you are going to an out of country college it will be MUCH more expensive. It is doubtful your Pell grant would cover all the costs.

Question: For moms going to school and work and raising a baby?
Baby is due in October. Hubby will be on parental leave from work for 6 months the date the baby is born. So, I want to take advantage of him being home to go to school full time. My University considers full time education as 9 cred hrs. and that will still qualify me for student loans and grants. So, question is, do you think 15 cred hours would be too much?

Answer: I think 15 hours is too much to start – especially with a new baby. Even with dad taking care of it you will be pooped. Babies are demanding, sleep schedules are hard to come by…and for fifteen hours – you need to factor roughly three hours for reading/homework per class per scheduled class time .. that is a lot of time to stay current. Take the nine hours and ease into it so you can see where you fit into the baby’s schedule and your work schedule. Also, if I remember right, full time is full time and the loans do not distinguish between 9 or 15 credits…so use that money to help you transition as well.