A penny saved is a penny earned “… or so the old proverb goes. Of course, the value of a penny has changed little since the time when his mother offered her wisdom on the value of keeping what you earn. Today, you could save thousands of dollars simply for the right mortgage decision. If you’re like most Canadian homes, your mortgage is a gold mine of potential savings.

In recent articles, we talked about the importance of your mortgage as one of their most important financial decisions. We explored the value of seeking professional advice from a mortgage if you’re buying a house or the renovation of an existing mortgage.

Today, let’s take a look at the bottom line: The savings can be enjoyed by the right mortgage decisions.

It is the primary function of a mortgage broker to find the right product for their personal situation. A mortgage is a financial intermediary and professional - as its investment adviser - he or she wants to understand his personal and payment preferences. Your mortgage broker has access to a broad spectrum of lending institutions, so that you can make a valuable comparison shopping for the right combination of features, prices and mortgage options.

All these options offer significant opportunities to save money over the life of your mortgage.

If you’re like most of the owners, who are focused, for good reason - in the search for the best for your type of mortgage. Your mortgage will agent can provide the best range of options rate and terms. If a mortgage broker that you can get one percent of the rate of displacement, which could translate into more than $ 13,000 in interest for $ 100,000 in a 25-year loan amortization schedule. However, if you believe that most mortgage rates are basically the same from one institution to the next, and then consider the fact that even one eighth of a point of difference in the rate can offer significant savings in the duration of their mortgage.

But it is also important to look beyond the fee. There are other ways to find savings on your mortgage. Your mortgage broker is updated on market trends and new opportunities … as well as some of the tried and true ways to save money on a mortgage.

Do you receive an annual bonus at work? You can use this voucher to pay the principal of your mortgage. If this strategy consistently over the life of your mortgage, you can save thousands of dollars in interest by paying off their mortgage before.

Are you paid bi-weekly or bi-monthly? Consider a change from the usual monthly mortgage payment. Configure your mortgage payment schedule to match your pay period. Once again, you can shave years off your mortgage, and enjoy thousands of dollars in savings.

In the coming weeks, we’ll see some of these savings opportunities in more detail. In the meantime, consider the old adage penny again. How long is their value? Saving time is a major, unexpected benefits that customers say they have enjoyed when opting to work with a mortgage broker. Above all, a mortgage broker is an expert in customer service, and that means that your agent takes care of every detail of your mortgage research and negotiations on their behalf.

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Private Lending Topic - I have received a number of email questions recently on very similar issues and thought I would address them as a group versus individual emails. The questions are broken down into general areas and include things to do and things not to do. The Don’ts include advertising on Craig’s List and the use of the word “Guarantee”. The Do’s include what are the best marketing methods. My comments on each are below….

Don’ts

Private Lending Advertising on Craig List - I do not recommend that you advertise on Craig List. It is too public and there are state and federal watchdogs looking for people who may be violating securities rules. I have said on many occasions that I do not recommend any advertising that is on a national scale including your own web site. This kind of advertising will get you into trouble with securities regulators and may be considered a securities offering to the public.

I know this from personal experience. Several years ago a person responded to my Craig’s List ad requesting information about my investment program. After several emails, the individual said he was ready to invest and I directed him to my title company to prepare the appropriate documents. Strangely, I never heard from the individual again after that.

A short time later, I received a “cease and desist” letter from the Pennsylvania Securities and Exchange. The letter had several direct quotes from the emails I had exchanged with this individual. The State did not fine me, but asked that I never advertise on Craig’s List or on my web site. Needless to say, I am complying.

Private Lending Guarantee - Do not use the word “guarantee” in any form in any of your advertising. Do not use the word “guarantee” or ever imply that somehow your investments are “guaranteed”. This is a sure fire way of attracting the attention of the wrong people. You may say your investments are secured by real estate, which is accurate, but do not use the word guaranteed.

Do’s

For Private Lending contacts you should schedule at least one breakfast meeting per week - This simple advice might be the best and almost certain way to attract large amounts of capital. Schedule a breakfast meeting every week with someone who has extra cash available and is interested in your lending program. You will not get everyone to invest, but the chances are you will get enough to support a reasonable real estate buying business. At these meetings, be sure to ask the person for the name of at least one other person they know who might be interested in your programs.

Hand out 5 to 10 business cards per week - Again, this simple but very powerful advice will ensure that you have plenty of people on your prospect list. These are the people you have breakfast meetings or schedule a group meeting with. Everyone you come in contact with may be a potential lender. Do not overlook people just because they do not fit the perfect profile. You would be shocked that people that you would never think of as investors may become one of your best clients.

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In the late 1980s and early 1990s we had the junk bonds and the S & L Scandals and now we have a crisis in the sub-prime lending banking sub-sector. During the height of the real-estate bubble too many loans were being made to folks who had marginal or less than marginal credit. Loans were made well above the actual equity value. Now the equity in many folk’s homes has dropped by 20% or more, where does that leave the lenders?

Well, it leaves the borrowers upside down in equity and for new home buyers it means more incentive to simply walk-away from their debt, vacate and/or wait for a long-eviction process. These factors will cause the sometimes less than ethical sub-prime lenders severe financial problem. Some economists and analysts will say, what did they expect; they deserve it? Others have said it is a sleazy industry, that sub-prime market.

No matter what you think about the situation or why it happened, there will be an economic fall-out to all this. More foreclosures, more sub-prime lender bankruptcies, more loans being recalled and more personal bankruptcies, thus a ripple affect in our economy. It will also cause a lengthening to the time of real estate value recoveries and that prolonged recovery will also impede positive advances in consumer confidence levels, which is an important economic indicator as well.

I certainly hope this article is of interest and that is has propelled thought. The goal is simple; to help you in your quest to be the best in 2007. I thank you for reading my many articles on diverse subjects, which interest you.

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