Affordable Updates to Make You Fall in Love with Your Home Again

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Does it feel like everyone is smitten with their home, while you’re lacking any sense of emotional connection to your surroundings? Take heart! Breathing new life into your home doesn’t require a huge renovation budget. Try these simple updates to bring back the spark and make you fall in love with your home all over again!

Enhance the Entryway

Your front entryway is the first area guests see of your home. Impress visitors by investing in a new front door or giving the current door a fresh coat of paint. A new front door can drastically change the look of your home and enhance curb appeal! If you are wary of changing your front door, you can repaint the exterior trim, update your house number tiles or install new outdoor lighting for an updated, more stylish look.

The Walls

Update your kitchen walls by adding a fun kitchen-backsplashbacksplash. If you do not have the budget for a tile backsplash, try something simple like tin ceiling tiles, wallpaper, stainless steel, chalkboard or magnetic paint. If you are thinking about updating the space above a desk area, consider adding a cork backsplash. Cork walls are not only inexpensive, but can also serve as a real-life Pinterest board.

Lighten It Up

light-fixturesNew kitchen lighting or an updated fixture over the dining room table can make a huge impact on your living space. Replace any outdated fixtures with modern light fixtures that make a statement. Or, consider adding a dimmer switch. A little mood lighting can go a long way in terms of ambiance! For an easy DIY fixture update, repaint an old chandelier or ceiling fan to give it a fresh look.

Landscape the Yard

Landscaping is too often overlooked. Fresh landscaped-yardlandscape isn’t only aesthetically pleasing, it can reduce water bills and maintenance if properly planned! Start out with a trip to the local greenhouse and figure out what plants thrive best in your area, or more importantly, what plants are easiest to care for. If you live in a drought prone area, look for plants that do not require lots of watering.

Clean and Fresh

living-room-interiorAs much as new updates will help, one of the easiest ways to revamp your home’s interior is a little TLC. Consider hiring a cleaning service to give your walls and floors a scrub down. Or tackle each room a day at a time. Start with the most-used rooms, like the kitchen or family room. Take time to wipe down every surface and clean the windows. Organize drawers, cabinets, countertops and any areas in your home that tend to get cluttered. Purge and/or store things that are not frequently used. A good thorough cleaning and a fresh coat of paint can give your home that sparkle that it was missing and make it feel like new!

By Kendall Taylor

Answers to Your Questions About Escrow Impound Accounts

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When you purchase a new home, one of the many decisions you will consider is whether or not you need an Escrow Impound Account, also known simply as an impound account. To help you understand what an impound account is and how it works, we’ve answered some commonly asked questions.

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What is an impound account?
An impound account is set up and managed by mortgage lenders to pay property taxes and homeowners insurance on behalf of the home buyer. Lenders will collect these fees monthly along with your loan payment and pay the tax and insurance bills on your behalf when they are due. Although these insurance and tax payments are not technically part of your mortgage, they are necessary for you to keep your home, which means the lender has a vested interest in making sure they get paid. The impound account protects the lender and offers you some added convenience to ensure your bills are paid on time.

How is the account set up?
Your impound account is set up by your lender during escrow. Escrow is that period of time during which an impartial 3rd party (the escrow or title company) holds on to your earnest money and the house until the sales transaction is finalized and funds and property can be properly distributed. The escrow company will collect an Escrow Impound Deposit, which is typically 2-6 months’ worth of tax and insurance payments. Because property taxes may be adjusted and insurance premiums can change, this money is collected in advance to allow for possible increases and ensure that the lender has enough in the account to pay the bills when they are due.

How does an impound account work?
The lender divides the annual cost of each bill into a monthly amount and adds it to your mortgage payment. Each month when you make your mortgage payment, the funds for property tax and insurance are deposited into an account. When the time comes to pay the bills once or twice a year, the lender uses funds that have accumulated in that account to pay the bills on your behalf. Your monthly mortgage statement will show the balance in the account and your lender will review the account annually to ensure that the correct amount of money is being collected. It’s important to keep an eye on the account and be aware that your monthly payment could fluctuate based on adjustments to property taxes or insurance rates.

What happens to money in the account after the loan is paid off?
At the conclusion of the loan, whether you pay it off with cash, refinance, or sell the property, any money left in the impound account will be refunded to you.

Is an impound account required?
Impound accounts are not mandatory in all cases. You may elect to pay insurance and property taxes on your own. However, if you have a government loan with a low down payment option such as FHA, VA, or USDA, you will be required to have an impound account.

What are the pros and cons of an impound account?
Since property taxes and home insurance bills are only paid about twice a year, you may find it difficult to consistently set the money aside to pay them. The impound account allows you to pay large home expenses gradually throughout the year and avoid the sticker shock of being confronted with large bills a couple of times a year.

On the flip side, pre-paying several months’ worth of taxes and insurance at closing may be a deterrent if you don’t have the cash on hand. Also, if you can be disciplined about saving for those bill payments, you may prefer to set the money aside in your own high-interest savings account instead.

If you have questions about which loans and payment account options may be right for you, contact a loan advisor who can review your situation and explain your choices.

By Amy Malloy

How to Choose the Right Energy Efficient Lighting

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Over the past several years, lighting options and the way they are measured have changed as part of the movement toward energy efficiency. Traditional incandescent bulbs are no longer manufactured and are quickly becoming a nostalgic thing of the past! They’ve been replaced by more efficient lighting options including: halogen incandescent, compact fluorescent lamp (CFL), and light-emitting diode (LED) bulbs. These energy-saving options offer choices of light levels, sizes, shapes, and colors. Which option is best will depend on the purpose and location of the lighting, as well as personal preference. Here’s what you need to know to make the right selection for each space in your home:

kitchen lighting

Halogen Incandescent
Halogen incandescents have the look of a traditional incandescent but are unique on the inside. Within the bulb is a capsule that holds a special halogen gas composition around the filament to increase efficiency. Halogen bulbs meet the federal minimum efficiency standard and are the most affordable option, but they are not the most efficient bulbs because they can cost more to operate and don’t last as long as other options.

Compact Fluorescent Lamp (CFL)
CFLs are typically identified by their corkscrew-like shape, although there are versions available in more traditional shapes. CFLs use 25-35% less energy than traditional incandescents and last about 10 times as long. They take about 30 seconds to reach their full brightness once turned on. It is worth noting that CFLs contain a tiny amount of mercury which means there are special health and safety guidelines to follow for recycling, disposal and clean-up of a broken bulb. The EPA Website provides more detail.

Light Emitting Diodes (LED)
While LED lighting tends to be the most expensive, these bulbs are expected to save you more in the long run due to longer life span and very low energy use. They use 75% less energy than a traditional incandescent and can last about 25 times longer.

Reading the Label
lighting_label_0The Federal Trade Commission developed the Lighting Facts label for product packaging to provide consistent information about light output, energy used, durability, and color of light. Here’s a breakdown to help you decipher the label:

Brightness is measured in lumens and tells you how much light you will get from the bulb. The more lumens, the brighter the light. 800 lumens would be about equivalent to a 60 watt traditional incandescent bulb. The Estimated Yearly Energy Cost and Life measurements will help you compare your return on investment between different bulbs. Light Appearance, also referred to as Color Temperature, allows you to choose the desired hue of the light. Warm light is more yellow and creates a smooth relaxing feel, measuring between 2700-3000 Degrees Kelvin. Cooler light that measures higher (further to the right on the Kelvin scale) is a whiter light typically used in kitchens, bathrooms and work spaces. Energy Used indicates (in watts) how much energy will be consumed to give off a certain amount of light. When replacing incandescents, you will purchase lighting with lower wattage, while still getting the same amount of light.

Armed with this basic knowledge of energy efficient lighting, you will be able to make better selections to enhance the ambience and functionality of your living spaces, while saving energy and reducing costs.

By Amy Malloy

Is Buying Down Your Rate Right For You?

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Rates began ticking up in the wake of the election and the upward trend is expected to continue, albeit at a slower pace compared to the first few post-election months. If you are currently in the market for a home, you may be concerned about battling increasing prices and upward trending rates. But, you could have the option to tackle affordability by buying down your rate.

reviewing paperwork

As RPM’s executive vice president of sales and marketing, Julian Hebron, explained in a recent CNBC article, “Buying your rate down, or ‘paying points,’ means you’re paying an extra fee on top of standard loan fees like appraisal, underwriting and a credit report to get a lower rate.” While this option costs more upfront, it could pay off in the long run. Since points are pre-paid interest, the benefit comes in the form of interest cost savings down the road.

How do you determine if this option is a good one for you? What are the risks? We’ve laid out some details to consider before deciding if paying points is the way to go in your particular situation:

Availability of Cash

Do you have the money to pay points up front? Will this leave you with enough left over to cover unforeseen expenses? The cost of buying a point is equal to 1 percent of the amount of the loan. For example, buying a point on a $300,000 mortgage would cost an extra $3,000 at closing, or at the start of the loan.

Monthly Interest Cost Savings vs Monthly Budget

Compare the rates for a loan option with and without points to calculate the monthly interest savings. For example, a 30-year fixed loan of $300,000 might show a rate of 4.25% with zero points. If you buy a point and pay an extra $3,000 at closing, the rate might drop to 4%. This .25 percent rate reduction might lower your monthly payment by $44 per month and save you $62.50 per month in interest cost. Comparing monthly payments is important for budgeting, but to calculate a break-even on the expense of buying points you need to use interest cost savings. (A quick math refresher: Interest cost is calculated by taking the Loan Amount x Interest Rate and divide by 12 to convert to a monthly interest cost estimate.)

Time Spent In the Home

Do you plan to stay put for long enough to benefit from the interest cost savings?  In order to calculate if the upfront fee is worth the potential savings over the course of the mortgage, you will need to estimate how long you plan to stay in the home. This will allow you to determine how long it will take you to “break-even”. For example, if you pay one point on a 5-year ARM and it takes 4 years to break even, you only have one year to benefit from the lower rate before the loan adjusts. Conversely, if you pay one point on a 30-year fixed and it takes 5 years to break even, you have 25 years to benefit from the lower rate.

Break-Even Calculation

With some simple math you can figure out how long it will take you to recoup the cost of paying points.  Take the cost of buying a point and divide it by the monthly interest cost savings. That will give you the total months it will take your interest cost savings to repay the point. Everything from that point forward is pure benefit from the lower rate. Divide that number by 12 months to convert the number of months to years.  If that figure is longer than you plan on being in the home (or loan), buying down your rate may not make sense. The chart below will help clarify the math for interest cost savings:

buying points chart

One of the risks associated with buying a point is that rates could drop after you spend the money to buy down your rate. “For now that risk is low, Hebron stated. “The Mortgage Bankers Association (MBA) is predicting that rates will rise about .375 percent from current levels during 2017.” As part of your decision making process, a loan advisor can help you review some of the economic indicators used by the MBA and other experts to predict where rates might be headed.

Market Outlook & Evaluating Risk

When it’s time to consider financing a home, contact an experienced loan advisor who can help you understand when buying down your rate meets your objectives.

By Amy Malloy

Key Economic Indicators that Affect Mortgage Interest Rates: Housing Reports

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For the past couple weeks, we’ve been looking at how key economic indicators cause mortgage rates to move up and down, and why home owners, buyers and refinancers, should follow along. In this last installment of series, we take a look at three housing reports that indicate the health of the economy.

Case-Shiller Index

Home prices are a huge indicator of how the economy as a whole is performing. The Case-Shiller Index is actually comprised of four indices; the National Home Price Index, 20-city composite index, 10-city composite index and 20 individual metro indices. These indices track the changes in price for sales of the same single-family homes over time in large markets throughout the country. It is published on the last Tuesday of each month and has a two-month lag time, so the index released in March will show data from February and January.

The Case-Shiller Index tells us whether home prices are increasing or decreasing throughout the country, and keeping an eye on the data could help you better time your purchase. If prices are increasing, you may decide to purchase quickly while your preferred home is within budget. Conversely, you may choose to hold off a little longer in hopes of a better deal if prices seem to be on their way down.

For more information on The Case-Shiller Index, click here.

MBA Purchase Index

Each week, the Mortgage Bankers Association (MBA) releases its Purchase Index, which measures the amount of home loan applications submitted nationwide – different from the number of homes purchased or loans closed – and is reported as a percentage increase or decrease from the previous week. The index reports on the factors that influence mortgage applications, such as interest rates, home prices, credit availability and all-cash homebuyers.

The MBA Purchase Index is considered to be one of the leading indicators of the health of the housing market. It helps housing economists and homebuilders forecast home sales, and lenders use the index to gauge the amount of applications they are receiving compared to the overall U.S. mortgage activity.

New Residential Construction Report

Every month, the U.S. Census Bureau and the U.S. Department of Housing and Urban Development (HUD) issue the New Residential Construction Report. This report is derived from surveys of homebuilders nationwide and includes data on housing starts, building permits and housing completions. Similar to the MBA’s Purchase Index, this data is presented as a percentage change from the prior month and year-over-year period.

Housing starts and building permits are considered leading indicators of growth for the housing industry and the data provides insight into the current state of the economy. Increases in new residential construction means there’s a higher demand for homes to purchase, which often leads to homebuyers spending more money on other consumer durable goods, such as home appliances and furniture. The more homes being built, the healthier the market .

To view the latest New Residential Construction Report, click here.

Want to know the latest on how these reports are impacting rates? Feel free to contact a trusted RPM loan advisors who will explain it in simple terms so you can better understand your financing options and make the choices that are right for you.

By Kendall Taylor

Key Economic Indicators that Affect Mortgage Interest Rates: The Employment Situation

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Business people having a discussion.

We continue our look at how economic indicators affect mortgage interest rates, with a dive into The Employment Situation Report—commonly referred to as the jobs report. It is released on the first Friday of every month and, of the indicators we’re discussing in our series, has the most impact on mortgage interest rates. This is because the data has broad implications for the overall health of companies and consumers, and identifies the direction of wage and employment trends. The economy reacts strongly to this report, with interest rates rising on stronger jobs reports and falling on weaker ones.

The Employment Situation Report is comprised of:

 Unemployment Rate

The Unemployment Rate is the total labor force that is unemployed, but actively seeking employment. The Bureau of Labor Statistics identifies the Unemployment Rate by analyzing U.S. labor sample surveys, Social Security Insurance statistics and employment office statistics. It then takes this data and compares it to the Current Population Survey, a monthly survey of 50,000 households, to express the unemployment rate.

This statistic is considered a lagging indicator, meaning that it confirms, does not predict, long-term market trends. After peaking in October 2009 at 10%, the Unemployment Rate was back down to 4.7% in December 2016 – a rate we haven’t seen since 2006 and 2007, pre-housing crisis.

 Nonfarm Payroll

The Nonfarm payroll represents the total number of paid U.S. workers and tells us how many jobs were created or lost in the previous month, and in which employment sectors. So this is a key indicator in how well the economy is doing. The total nonfarm payroll accounts for 80% of the workers who produce the GDP and directly affects the stock market and the U.S. dollar.

The Take Away

The Employment Situation Report remains one of the most widely watched indicators of the U.S. economy, despite its ability to fluctuate and its continuous revisions. Statistics regarding U.S. employment directly influence financial markets and provide valuable insight on interest rates. For the next Employment Situation Report release date, click here.

In the next edition of our economic indicator series, we’ll be focusing on U.S. housing reports. If you missed our last installment on consumer behaviors, click here.

Want to know the latest on how these reports are impacting rates? Feel free to contact a trusted RPM loan advisor who will explain it in simple terms so you can better understand your financing options and make the choices that are right for you.

By Kendall Taylor

Key Economic Indicators that Affect Mortgage Interest Rates: Consumer Behaviors

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Throughout the year, reports are released that provide us not only with a look at the current state of the economy, but insight into potential economic trends that could be headed our way. And because these economic indicators can cause mortgage rates to move on a monthly, weekly and even daily basis, it’s especially helpful for home buyers, owners and refinancers to fully understand and follow these reports so they can make informed decisions when needed.

Over the next few days, we’ll be taking a look at various indicators in the categories of consumer behavior, jobs and housing, and why they are ones to keep an eye on if you’re considering a new home purchase or refinance. We’ll start by diving into four widely followed reports based on consumer behaviors and how they can impact interest rates:

Gross Domestic Product

Gross Domestic Product (GDP) measures the market value of all goods and services produced in the U.S. and shows us how much the economy is growing or contracting each quarter. Stronger GDP causes interest rates to rise, while weaker GDP causes rates to fall. GDP is updated three times throughout the quarter as data comes in and these revisions can add to rate volatility as they trade daily.

For previous GDP reports and upcoming release dates, click here.

Consumer Price Index

The Consumer Price Index (CPI) measures the changes in prices paid for consumer goods and other services purchased by households, and is one of the two most common indicators of consumer inflation – the other being the Personal Consumption Expenditures index. Rates are sensitive to CPI because if market investors think their future rate of return on their investments won’t keep up with rising inflation cost, they will sell their investments, causing rates to rise. In other words, higher CPI means higher rates, and lower CPI means lower rates. Since the financial crisis of 2008, CPI has been relatively low, but an improving economy typically results in inflation and increased interest rates.

To see when the next CPI report will be released, click here.

To see when the next PCE report will be released, click here.

Producer Price Index

While the CPI measures changes in the prices paid for goods, the Producer Price Index (PPI) measures the changes in prices received for goods by producers in the U.S. It’s one of many producer inflation measures to determine the health of goods-producing sectors of the economy, like mining, manufacturing, agriculture, fishing, forestry, natural gas, electricity and construction. Rate markets react the same to PPI as they do to CPI and PCE—rates generally rise with rising PPI and fall with lower PPI.

To see when the next PPI will be released, click here.

Consumer Confidence Index

The Consumer Confidence Index (CCI) is designed to measure consumers’ optimism surrounding the state of the economy and is based on the results of the Consumer Confidence Survey. The survey is administered to 5,000 households every month. Participants are asked five questions, two about current economic conditions and three about future expectations. Participants can only respond with positive, negative or neutral. If the CCI measures consumer optimism high, the idea is that consumers are likely to purchase more goods and services, and an increase in consumer spending helps stimulate the economy.

The Conference Board releases the CCI on the last Tuesday of every month. For more information regarding the latest CCI, click here.

So you may have already started seeing a trend here – increases in these indicator reports can stimulate an increase mortgage interest rates, which may be a concern if you’re shopping for a mortgage. But, increases are also sign of an improving economy and as long as you’re finding yourself in a financially healthy position, there’s little to be worried about. We’ll continue our series by taking a look at U.S. employment.

Want to know the latest on how these reports are impacting rates? Feel free to contact a trusted RPM loan advisor who will explain it in simple terms so you can better understand your financing options and make the choices that are right for you.

By Kendall Taylor

Home Maintenance to Retain Value during the New Year!

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At the start to every New Year, we all promise to make changes for the better and set resolutions to help achieve these goals. One part of our lives is often overlooked– our homes. This year make an effort to maintain your home better and give it the upgrades it has so badly needed! Here are a few home maintenance updates that will help boost your home’s value in the upcoming year:

The Kitchen

Let’s face it– your kitchen is tired. After countless meals, baking experiments and afterschool snacks, your kitchen may be looking worse for wear. Consider refinishing or repainting your cabinetry. This upgrade can be budget-friendly, if you choose to Updated kitchenturn this upgrade into a DIY weekend project. To complement your new cabinetry, replace any outdated hardware. New hinges and drawer pulls can transform the entire look of your kitchen.

Looking for a more drastic change to your kitchen? Change out appliances in favor of more stylish and more energy efficient models. Or, give your countertops a fresh new look by exchanging tile or laminate for granite or quartz. These upgrades are more costly, but will leave you with a fully upgraded kitchen!

The Yard

Give your yard some TLC by adding greenery alongDrought-friendly plants in a garden box. the walkways and patching up any bare spots with fresh sod or seed. When adding new plants to your yard, look for native plants with a long lifecycle and consider the amount of water required, especially if you are in a drought-challenged area. Not only will these plants last longer, but they will require less maintenance and less frequent replacement, making them a cost-friendly option. When your backyard is livelier, and stops looking like an unfinished project, you will be more likely to spend time in it.

The Bathroom

Start the New Year off with a deep cleaning to get any dirt Updated bathroom with white tile.or grime off your bathroom surfaces. Small changes like replacing outdated wallpaper, getting shower glass to sparkle again, and updating light fixtures can boost your home’s value without emptying your wallet. If you are ready for a bigger remodel, think about adding new flooring and plumbing fixtures or upgrading your bath tub or shower. When it comes time to sell your home, you will be glad to see the return on investment from that new bathroom!

The Walls

A fresh coat of paint is the easiest way, and cheapest – especially if you paint it yourself, to rejuvenate your interiors! Consider painting the Neutral wallswalls of high-traffic areas, such as the front entryway or stairs. These walls can easily get scuffed and are often overlooked when it comes to home maintenance. If you are contemplating selling your home in the near future, consider painting your walls in neutral colors. This helps potential buyers be able to visualize their belongings in your home. Plus, neutral walls can work with a wide array of interior decorations, if you like to swap out interior decorations with the changing seasons.

The Floors

New hardwood flooringLike paint, new flooring can drastically change the look of your home! Stained or ripped carpet is not helping your home look any younger. Replace your old carpet with easy-to-clean and visually pleasing flooring. Hardwood flooring is appealing to a wide-array of buyers. Other more affordable and eco-friendly options include bamboo and cork. If you are lucky, you may have hardwood floors hiding underneath your carpet. With a little sanding and refinishing, your hardwood flooring will look good as new!

What upgrades do you plan to make to your home this coming year? Share in the comments below!

By Kendall Taylor

Setting Goals to Achieve Homeownership

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As a first step in preparing for a home purchase, it’s important to determine if you are actually ready to become a homeowner. Are you able to stay put for a while? Is your income fairly stable? If you answered yes to both questions, the next step is to carefully consider your finances. Resolve to do the following in the New Year and you could be ready to purchase a home sooner than you think – maybe even ahead of any anticipated rate increases.

New Year Resolutions

Evaluate Debt
Do you have credit card debt, auto or student loans? The amount of debt you are carrying is important because it factors into your debt to income (DTI) ratio which lenders use to qualify you for a home loan. It is calculated by dividing all of your monthly financial obligations (debt) by your gross monthly income. You generally want to aim for DTI less than 36%.

Set Up a Budget
Take a close look at what you spend every month. Start with a budget worksheet to organize your monthly expenses. To create some padding in your budget to allow for the unexpected, calculate 10% of your total expenses and add that to a miscellaneous expense category. Remember to include your savings as an expense.

A rent vs buy calculator will also allow you to do a simple payment comparison. But, be sure you consider all housing expenses, not just the mortgage. The amount you pay in rent may be similar to what you would pay in principal and interest on a mortgage loan, but you also need to take into account additional homeownership expenses like property taxes, insurance, HOA fees, trash pick-up and utilities.

Create a Savings Plan
Once you’ve established a budget, determine where you can cut expenses. Set a goal for paying down debt and saving for a down payment. Consider automating your savings plan to commit a certain percentage to be routed to a savings account each month.

While it is generally a good practice to have a 20% down payment to avoid private mortgage insurance (PMI), there are options to put down as little as 3.5%.

Do a Credit Check-Up
Everyone is entitled to one free credit report per year. Visit annualcreditreport.com to request your report and review it for errors and unusual activity. If there is something that needs to be corrected you can dispute the accuracy of the information with a consumer reporting agency under the guidelines of The Fair Credit Reporting Act (FCRA). Under this law, the agency must conduct an investigation at no charge and make any adjustments within 30 days.

Prepare for the Mortgage Process
After your budget is set and your savings plan is in place, it’s time to gather documentation and apply for a mortgage pre-approval. Be prepared to provide verification of your income with the last two years of W-2s, last two years of federal tax returns and your most recent 30 days paystubs. To verify personal assets you will need to provide the last two months of bank statements and quarterly investment/401k and retirement statements. Depending on your specific situation, additional items may be required so organize any documents that relate to your financial status.

To learn more about the pre-approval process and begin your journey to homeownership, contact a loan advisor today!

By Amy Malloy

Making Sense Of Your Credit Report

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Woman looking over Credit Report.

A credit report offers a summary of your financial life, including your loan payment history and the status of your credit accounts. Lenders use these reports, along with other information, to evaluate what lending options you qualify for.

What is in a credit report?

Credit reporting companies collect information from public records and companies you do business with in order to compile your credit report. Each credit reporting company formats and reports information differently. However, all credit reports contain essentially the same categories of information. Each category is broken down below:

Identifying Information

Your name, address, Social Security number, date of birth and employment information are all used to identify you on your credit report. This comes from the information that you have provided to lenders, and is used solely for identification purposes.

Trade Lines

Trade lines represent a list of your total number and history of credit accounts. Lenders report on the type of accounts you established with them, such as bankcard, auto loan or mortgage. The date you opened the accounts, your credit limit or loan amount, account balance and payment history are all documented here.

Credit Inquiries

Each time you apply for a loan, you authorize a lender to ask for a copy of your credit report. The Credit Inquiries section identifies everyone who accessed your credit report within the past two years. The report lists both ‘voluntary’ inquires and ‘involuntary’ inquiries. ‘Voluntary’ inquiries appear when you make a request for new credit. ‘Involuntary’ inquiries appear when lenders order your report. This can happen when a lender wants to make you a pre-approved credit offer in the mail. ‘Involuntary’ inquiries do not affect your credit score.

Public Record and Collections

Here you will find public record information from state and county courts, as well as information on debt from collection agencies. Public record information can include bankruptcies, foreclosures, suits, wage attachments, liens and judgments.

What should I look for in my credit report?

It is important to review your credit report once a year to check for accuracy. Keep an eye out for any information that is inaccurate, incomplete or information that should no longer be on your credit report. Remember, your credit report should only show credit inquiries within the past two years. Other errors to look out for are addresses where you never lived or employers you never worked for.

If you find any errors, report them to the creditor and the credit reporting company that you received the report from to have them corrected. If you think that any fraud or identity theft has occurred, contact the credit reporting company immediately. The credit report will include information on how to dispute incorrect or incomplete information.

Where can I get my credit report?

The Fair Credit Reporting Act (FCRA) requires that each nationwide credit reporting company give you a free credit report once every 12 months.

You can request your credit report at www.annualcreditreport.com or call 877-322-8228.

By Kendall Taylor