buying a home in the Chicago area

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 are doing…

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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 you are already a veteran and have been honorably discharged, in…

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What Questions Should You Ask Your Lender When Applying for a Loan?

                  When shopping for renovation loans and FHA 203k renovation loans, what questions should you ask your lender to be sure they are qualified and ensure a smooth process? Renovation loans are popular because they are flexible: you can take a property in need of a lot of work, and turn it into a good-as-new home, or find a home needing minor updates and make it the way you want. Checking Lender Experience While many lenders say they do renovation loans, it is important to find out how many they’ve actually done. One of the most important things to determine is the amount of experience your lender has with renovation loans. Renovation loans are different than traditional mortgages. Not only does the borrower need to be approved, but contractors doing the renovations need to be involved as well. Everything that needs to…

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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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What Mortgage Programs Are Available to Veterans?

If you’re a veteran or a disabled veteran, what special programs for buying a home are available to you? If you served your country, you can take advantage of the Veterans Administration Loan Program that allows you to get 0% down on a home loan. In addition, there are other benefits with a VA loan, which will be described below. Funding Fee When setting up a Veterans Administration loan, a funding fee is attached to the mortgage. VA loans do not require mortgage insurance, as with typical mortgages when you put less than 20% down. However, there is a one-time funding fee that is added back into the mortgage. The amount of the funding fee depends on whether you were active duty, or served in the National Guard. However, if you are a considered a disabled veteran, this funding fee is waived and can save you money up front. Real…

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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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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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Renovation Loans: How Long to Close

How long does it take to close on a renovation loan? Many folks have heard horror stories on renovation loans, which often times can take 90 or 120 days to close. Realtors often discourage the use of renovation loans because they never close. However, renovation loans can close quickly when set up appropriately. Two main factors influence the amount of time renovation loans will take to close: making sure the loan officer gives good advice on an appropriate time schedule, and you doing your homework. When doing a renovation loan, you will go and find a property and get a contract on the home, and then determine what work needs to be done to the home. Once under contract, your list of repairs and upgrades needs to be priced out, which involves getting quotes from good contractors that will do the work. Coming up with a list of what work…

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