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Credit Card Debt

credit card debt

Credit card debt levels

Be very careful with your credit card debt levels. Ideally you want to purchase items with your credit card that can be paid in full each month when your credit card statement arrives.

Buidling up large credit card debt levels can be a downward negative trajectory of the accumulation of long term high interest debt payments. The larger your debt balance becomes the more difficult it will get to pay it in full. The credit card companies are happy because they are making lots of money on the interest charges, but this is not good for you.

The next challenge or problem with high credit card debt levels is that when you apply for a loan whether that be a personal unsecured loan such as a personal line of credit or a secured loan such as a mortgage for a house the loan company or other financial institution will pull your credit report and review it in detail including seeing what your credit or beacon score is.

Lenders will look at your total monthly debt payments and then add the monthly debt payment of the mortgage amount you want to borrow and then compare it to your income. If your income is not strong enough to support all the monthly debt payments then the lender will decline your mortgage application.

We always recommend that you contact us ahead of time and let us help you prepare for the time when you apply for a mortgage. At Trusterra Mortgage it is our goal to help our clients understand their financial and debt situation. We will advise and guide them on next steps to take to improve their credit strength and to prepare themselves for applying for a mortgage loan in due course.

Based on our consultation together we will decided and suggest to you if its time that we go through a proper mortgage application, part of it being to pull your credit report and anyalyze it. By pulling your credit report we will see everything that is being reported by credit bureau and will let you know what’s in it. Some times people don’t realize that their are old information still on their reports; for example, a debt that they paid in full still shows up as active in their credit report. This process allows them to rectify and update their credit reports, which in turn will make it better and to some extent easier for the lender to review and approve their mortgage application.

In conclusion, we recommend that you contact us and ask any questions you have. Share with us your real estate investment plans and aspirations. We will, to the best of our ability and long-time industry experience, provide professional advise and guidance to you.