Get Financially Fit

Discover how to prepare for buying a home.

If you're goal is to be a homeowner but the dream seems out of reach, give us a call. We'll do everything we can to assist and support you in reaching your goal. Read through this section to see what we mean. Ownership means a lot to us—we'll help you figure out how to start building your equity.
Your credit history is represented by credit scores. They are the driving force in determining whether or not you qualify for a home loan. A credit score calculates the probability of default—how likely you are to make your loan payments on time. Although the scores may seem arbitrary, the science—especially over the past 20 years—has made them fairly accurate. Equity Atlas knows and understands the science. This can provide an upper hand in resolving credit issues that may be affecting your scores. Even with a low score, given sufficient time and a game-plan (usually 1-2 years), one is able to improve the scores to a point where one qualifies for a home loan.

Credit Score Rankings

In the event you have no credit or less-than-perfect credit, don't worry. There are proven strategies for building good credit. Credit scores are based on your credit history, how much money you owe, how long you've owed it, how many new accounts you have, how often you miss or are late with payments, and what type of credit accounts you have. Changes in any of those factors will cause your score to recalculate.

What is Factored?

Take a look at the minimum scores listed under Loan Programs. The higher your credit score, the more loan options you'll qualify for and the more likely you'll qualify for a lower rate. There are three credit reporting agencies who provide complimentary credit reports annually through the sanctioned U.S. Government website, Sometimes there can be incorrect information on the reports. If you discover any mistakes that need correcting, it's best to contact the credit agency as soon as possible. Removing errors can take time, and there is a lag-time between when the correction is made and when the credit score improves. Not sure how to manage this process? Contact one of our Home Loan Advisors for further information and assistance on how to improve your credit scores.
Let our expert Home Loan Advisors assist you with the process of building or rebuilding your credit. It's only a matter of time before you'll be eligible for a home loan. The Great Recession affected many households and potential homebuyers.

Don't let this stop you in your pursuit to own a home.
Here are some examples of our clients building the credit they needed:
For Joe, 37, and his family, rebuilding their was a long-term affair. Affected by a layoff during the , they were forced to sell their home as a . During the three year mandatory waiting period, they slowly rebuilt their credit. When the time came, they were ready to buy. Utilizing a low down payment with minimal requirements, they were able to find a home that met their family's needs. Joe, his wife, and two children now live in a single-story home in a beautiful SE Portland neighborhood.
Elsa, 26, and her husband were committed to purchasing their first home. With minimal income and savings, several loan programs were utilized including the Credit Certificate. Unbeknownst to them, was the fact her husband had multiple medical collections on his . The claims had been reported in error. It took several months of continuous correspondence before they were removed. The end result was a sufficient improvement in his s which enabled Elsa and her husband to purchase and close on their first dream home.
Melissa, 39 and her husband owned their home for 10 years. They decided to do a to lower their rate as well as provide funds for the purchase of an . During this time-period, a small card balance was overlooked and went unpaid, which lowered the husband's to 657. Although it was still possible to close the loan, the rate was approximately .250-.375% higher. After analyzing the credit, it was determined the best course of action was to pay off the small balance as well as another credit card and then rescore the credit. In the end, the score improved to 684, which resulted in an reduction and long-term savings.

More Reasons For Building Good Credit

Not only do s affect your home loan rates and payment rates, they can affect your s and pricing on everything from credit cards to auto loans to the insurance premiums for your home and auto. Even potential employers may use credit scores to help evaluate how dependable you are.

Mortgage Insurance

Mortgage Insurance helps make homeownership more affordable when you have less than 20% down. While some loans such as the Loan require no mortgage insurance, most loans, in some fashion or another, require mortgage insurance coverage when there will be a low . Rather than wait until you accumulate a savings of 20%, mortgage insurance provides the opportunity to buy a home sooner with less money down. The mortgage insurance is in place during the early years of your home loan. Once you pay the mortgage balance down to 22% of the original purchase price, you can cancel the mortgage insurance coverage. Note: s no longer offer this option. Most loan programs allow for a new to determine the home's value in place of the original purchase price.

There are different types of mortgage insurance and different rates dependent on the amount of the down payment, the loan program, and your s. Be sure and check with your Home Loan Advisor which loan program is best suited to your homeownership goals for the short and long term.

Maintaining Financial Fitness

Tax Benefits

IRS Tax Publication 530 outlines the tax deductions and how tax filers should treat costs relating to purchasing and owning a home, including s, interest, real estate taxes, and repairs. The publication outlines which home-related items can and cannot be deducted on the tax return and what items a taxpayer should keep track of in order to set the of the property.

One of the biggest deductions will be the interest you pay on your home loan. are deductible from your federal taxes if you itemize. , if paid at the closing, are tax-deductible in the year you pay them. If you use part of your home exclusively for a home-based business, you may be able to deduct a portion of the related expenses. To make it worthwhile, your itemized deductions should exceed your standard deductions. Check with your accountant to make sure you are receiving the full tax benefits of home ownership.

Simple Interest Loans

All loans made by Atlas are s. Simple interest ignores the effects of , so interest paid is always based on the outstanding balance; there is no interest on interest. This means that if you make additional payments, you will lower your outstanding balance thereby lowering the amount of interest you pay over the lifetime of the loan.

For example, if you have a loan amount of $200,000 with a fixed payment for 30 years at the rate of 5.00%, your monthly payment is $1,073.64. By making one additional payment annually, the loan will be paid-in-full in 25.42 years versus the normal 30 years, thereby saving $32,922 in interest payments.

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