First Time Home Buyers

Why Are Appraisals Important?

                When you get qualified for a mortgage, you get approved for your unique situation: your income, your debt, and your credit. Also, lenders check that the property is a good fit for you, which is done through an appraisal. Who Does the Appraisal? When an appraisal is done, an unknown, third-party, qualified professional is brought in to examine the property. The buyer and lender do not have the ability to choose the appraiser. This person will go to the property and look at the amenities of the property, and then compare that to all the properties that have sold in the area to determine a fair market value for your home. Is the Appraised Value Acceptable? A lender will look at the appraised value of the home, and compare that value to your contract price, whether you have bought the home or…

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Who Can Qualify for a VA Loan?

                        VA loans, or loans through the Veteran’s Administration, are special loan programs for veterans that require qualification. If you are looking at VA loans, you have probably heard of some of the great benefits: you can buy a home with no money down, you do not need monthly mortgage insurance (rather, there is just need a one-time funding fee built into the loan), and you get a competitive interest rate with low closing costs. It is probably one of the best loans out there and was designed for those who have served our country. Do You Qualify? If you have been in the Armed Forces, such as the Army, Navy, Air Force, Coast Guard, Marines, National Guard, or their reserves, you could be eligible. The VA loan program is inclusive of both active duty and qualified veterans. If…

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Making Income Changes While in the Process of Obtaining a Mortgage

                  What happens if you have to change jobs while you are in the middle of getting a mortgage? Lenders typically recommend that you do not make major changes if you are in the middle of trying to get a mortgage, because lenders look for continuity, and will have to re-verify information if major changes are made. However, many folks do not have a choice: sometimes a new opportunity comes up, or are forced to change jobs. The good news is that lenders can work with you, and use the new information (income, salary, etc.) from your new position for your qualifying. This process can be started with just an offer letter, so the terms (salary, start date, etc.) are known to get the process started. Typically, at least one pay stub will be required before closing to show that you have…

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What Can You Do with a Renovation Loan?

What specifically are you allowed to do with a renovation loan? The real question is, “What can’t you do?” because there is a lot of flexibility with this type of loan. There are many different ways to use this program. There are three basic types to look at: FHA 203k renovation loan: a great way to get a government-insured property with as little as 3.5% down, including costs of repairs Homestyle renovation loan: better if you have a bit more of a down payment VA renovation loan: includes special benefits for veterans and disabled veterans The good thing about renovation loans is their flexibility: you can use it for something that just needs a little bit of work or a home that needs a tremendous amount of work. It doesn’t matter what the condition of the property is currently in, but what the condition will be once you finish making…

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Learn About the Illinois Assist Program

                  For first time home buyers, there is a great new program called the Illinois Assist Program. This program is great news for first-time buyers and is a grant that does not have to be paid back, which gives money back at closing towards your down payment and closing costs. If you qualify, you can get up to 5% of the loan amount back, which can be a huge amount. Qualifications for the Illinois Assist Program There are some strings attached – it is not available everywhere in Illinois, but is in a number of areas in the Chicago area: including Cook County, Kendall County, and a number of cities such as Naperville, Schaumburg, and Aurora. There are income caps for the buyer, but they are still relatively high so there is room for you to buy, and there is a cap…

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How to Find the Right Lender for a FHA 203k Renovation Loan

                  A renovation loan, or FHA 203k renovation loan, is a great tool for buying a home that needs some repairs or improvements to raise the value of the home. Renovation loans allow buyers to incorporate renovation costs into the mortgage in order to improve the home and raise its value immediately, rather than waiting to renovate years down the road. In addition, this can save money in comparison to a second mortgage or use credit cards to make improvements. When shopping for a lender, what questions do you need to ask when considering a renovation loan, or FHA 203k renovation loan? How Experienced Is the Lender? How many renovation loans has the lender done in the past? There are many moving parts to a renovation loan: you have to approve the situation, know the timing of everything, and know what is…

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How Can a 203k Renovation Loan Save You Money?

                  If you’re looking into buying a home in the Chicago area, a 203k renovation loan can end up helping you save money. If you’re looking to buy with an FHA 203k loan, it will allow you to buy a home, and add in some improvements at the same time. While it costs a bit more to buy with a 203k loan than a traditional mortgage, you can still save a lot of money if you know what you’re doing. When a Renovation Loan is Appropriate It comes down to your plans for the home after you buy. Many folks think that a renovation loan is only for buying a run-down property or a foreclosure, and homes that haven’t been cared for very well. However, there are many homes in good condition that are simply out of style, such as homes occupied…

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Down Payment: Where Are The Funds Coming From?

                  One of the issues we see arise during the loan process happen while verifying down payment.  Down payment funds may come from several sources, and all of them have their own unique documentation requirements.  If the underwriter is unable to easily see where the money came from it can cause a huge headache for everybody, including you. Luckily, there are things you can do to help ensure that this part of the process is as smooth as possible.  When reviewing the bank/investment account from which the Down Payment will be coming from, the underwriter is looking over the most current 60 days in the transaction history.  Any deposits into the account, besides payroll direct deposits, will need to be explained. This makes the easiest way to avoid frustration is to have your down payment funds already in a separate account with…

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What Is the Mortgage Appraisal Process?

                    Today, we are going to talk about appraisals and the mortgage appraisal process. When you go to get a mortgage, lenders approve YOU, and your specific financial situation. A lender will begin by looking at your credit, your income and your debts, the sources of your income, and the specific property you are buying or refinancing. The lender will check that the cost of the home is where you need it to be from a financial standpoint, and that it comes in at the right value by doing an appraisal. Finding an Appraiser When doing an appraisal, a qualified appraiser is brought in to appraise the value of the home. Previously, we could pick the appraisers that we brought in to do the appraisal that knew the area well. However, today there is more of a blind system: appraisers are…

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Are You Thinking About Buying a Chicago Area Home in 2017?

                    With 2016 behind us, and the beginning of 2017 underway, many folks take a step back and look at their New Year’s resolutions and what they would like to accomplish in the coming year. While reflecting on their aspirations for the year, many renters and first-time buyers have the goal of purchasing a new home in 2017. If buying a home is one of your New Year’s resolutions, take some time to figure out and assess where you are now, and where you need to be in order to buy a home. Doing an assessment with a qualified mortgage loan officer will help you determine where you are at financially, and things you can to do to help you prepare to buy a home. Examining Your Savings, Debt and Credit An important aspect of your financial picture is your amount…

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