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        <atom:link href="https://www.chicagosluxurycondos.com/blog/2020-03/rss/" rel="self" type="application/rss+xml" />
        <title>Real Estate Blog</title>
        <link>https://www.chicagosluxurycondos.com/blog/2020-03/</link>
        <description>Follow Linda Shaughnessy's Luxury Living Blog, reporting on luxe real estate trends for the affluent Chicago market. </description>
<item>
    <guid>https://www.chicagosluxurycondos.com/blog/do-you-need-a-pre-approval-letter-to-make-an-offer-on-a-property.html</guid>
    <link>https://www.chicagosluxurycondos.com/blog/do-you-need-a-pre-approval-letter-to-make-an-offer-on-a-property.html</link>
        <author>Linda@ChicagosLuxuryCondos.com (Linda Shaughnessy)</author>
        <title>Do you need a pre-approval letter to make an offer?</title>
    <description> <![CDATA[ 
While you are not required to provide a mortgage pre-approval letter in order to make an offer on a property, it vastly improves your chances of having your offer accepted. This is because a pre-approval assures the sellers and their broker that you are serious about buying their home, financially qualified to buy their home, and that there will not be extensive delays to closing since you have already begun the process of working with a lender.





When you think about buying a new home, you probably think about square footage, fixtures and finishes, along with the right neighborhood or local schools. However, one of the most important things to consider early in the process is your mortgage application. When should you apply for a mortgage pre-approval and how does the process work?


 We have the answers to your most burning questions. Keep in mind, every loan approval and home purchase is different and your specific situation can affect timelines and processes.


What is the difference between pre-approval and pre-qualification?


While many people use the terms mortgage pre-approval and pre-qualification interchangeably, they are, in fact, distinctly different processes. While pre-qualification may provide some helpful preliminary information, pre-approval is far more useful throughout your home search process.


Mortgage pre-qualification can be done quickly over the phone. It is based on a brief conversation where your lender will ask a few questions about your income, assets, debt, and overall financial picture. This will allow the lender to give you a ballpark figure for your home search, a professional guesstimate of how much home you can afford.


 Mortgage pre-approval goes further and is potentially much more helpful. Pre-approval involves the lender pulling your credit report, with your permission, in order to give a much more accurate and thorough picture of the loan amount for which you could potentially be approved.


Because pre-approval offers you more information and a more solid sense of your potential loan amount, it pays to get your pre-approval early in the home search process.


How does mortgage pre-approval affect my credit score?


There are two types of credit inquiries -- “soft” and “hard.” A soft credit inquiry is the kind that an employer might make in order to determine whether or not you are qualified for employment. A hard credit inquiry is attached to an application for credit or a loan.


 However, the mortgage pre-approval process falls somewhere between these two types of inquiries. While it is attached to a loan application -- and is thus a hard inquiry -- pre-approvals are lumped together as part of the same loan process. That means that you can apply for multiple pre-approvals within a 14-day period with only a single five-point impact on your credit score.


Can I be pre-approved by multiple lenders?


You can be pre-approved by multiple lenders, and it pays to shop around. Mortgage pre-approval allows you to:




       Compare interest rates, fees, and requirements for a variety of lenders


       Evaluate the pros and cons of a variety of loan products


       Determine which company’s customer service is best.




Comparisons among three different lenders may yield some interesting results. Beyond that, the law of diminishing returns takes hold and you will probably not see much difference.


What do I need to provide for a pre-approval?


Most of the documents you need for pre-approval will subsequently be used during the mortgage underwriting process. These include:




       Social Security Card and Driver’s License for each borrower


       Proof of employment


       Proof of income


       Self-employment income information


       Tax documentation


       Place of residence


       Bank account information


       Debt information




 If some of your funds will come from gifts, you will be required to supply letters from the gift-givers to verify the funds. This is important in order to ensure that you will not be expected to repay the money.


What will a pre-approval letter include?


Your lender will generate an initial pre-approval, then will create a specific letter to accompany your subsequent offer. The pre-approval letter will normally be printed on the lender’s letterhead, and will include:




      Borrower name(s)


      Lender information


      Maximum loan amount or purchase price


      Interest rate


      Repayment details


      Property type




If you are applying for a specific loan program, this information may be included as well as the down payment amount, if available.


How long does pre-approval take?


Some lenders may take several days to process your documents and provide you with a pre-approval. Others may use online resources that shrink the pre-approval process to just a few minutes. Once the initial pre-approval has been created, you should be able to get a subsequent, property-specific pre-approval letter relatively quickly.


How long does pre-approval last?


Pre-approval is generally good for about three months. However, keep in mind that significant changes to your credit score or to the loan requirements may mean a change in some of the specifics of your eventual loan and even of your approval status. Once you’ve been pre-approved,




       Don’t make new, major purchases, especially on your credit card


       Don’t take out additional new loans


       Don’t quit your job


       Don’t change banks or open new accounts


       Don’t close out existing credit card accounts


       Don’t make large withdrawals or deposits that you can’t account for.




 Looking to begin the pre-approval process? Your real estate broker offers an extensive network of lenders and other professionals to assist you throughout your home search and purchase. Let’s discuss your particular needs and your financial information in order to find the right lender for you


                                                                                                              What credit score do you need to buy a house ~ Read More


 


 


Jameson Sotheby’s International Realty


55 E Erie Street  1C


Chicago, IL 60611                   


 
 ]]> </description>
    <pubDate>Mon, 23 Mar 2020 10:30:00 -0500</pubDate>
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<item>
    <guid>https://www.chicagosluxurycondos.com/blog/what-are-hoa-fees-and-what-do-hoa-fees-include.html</guid>
    <link>https://www.chicagosluxurycondos.com/blog/what-are-hoa-fees-and-what-do-hoa-fees-include.html</link>
        <author>Linda@ChicagosLuxuryCondos.com (Linda Shaughnessy)</author>
        <title>What are HOA fees and what do HOA fees include?</title>
    <description> <![CDATA[ 
The term HOA  or Homeowner’s Associate Fee, refers to the monthly fee an owner pays for the use of a condo building's common amenities, including the exercise room, the pool and sun deck, the services of the building's staff, a professional  property management company, if the building has one, water (in Chicago), and, in most cases, the building’s common insurance





However, there is so much variability among condo buildings and townhome communities,  it s recommended that you become familiar with the various HOA fee structures before you begin your property search. Ask your realtor,  what is and isn’t included, so you can accurately determine whether or not a property is within your budget.


Types of HOA Association Fees


Townhome HOA Fees


Towhomes may be owned “fee simple” meaning you own and maintain the exterior of the townhome as well as the land. The HOA fees, therefore, are lower.


Other townhome communities are condominiums, and, like units in a high rise, the owner owns the interior, and pays dues to the association to maintain the common areas. And, while you may feel like you own your own home, the exterior will have to conform to the homeowner’s association rules, including the color you paint your front door.





Even when you know if a townhome is fee simple or a condominium, ask before a showing if the homeowner is responsible for roof repairs, windows, and tuck pointing. You will confirm all this information during the attorney approval process when you read the bylaws and declaration,  but knowing up-front will help you to better evaluate the property based on possible future expenses.


Condo HOA fees


Ownership of a condo is often referred to as “walls-in,” because the building itself and its common areas are jointly held by all of the owners while actual ownership is limited to the individual unit. You will, therefore, be required by your lender to have homeowner’s insurance for the condo’s interior, and your monthly HOA fee will include a payment toward the building’s common insurance. In Chicago, water is included also.





The more amenities the building offers, the higher your HOA fees will be. A pool requires cleaning and maintenance, a sun deck needs flowers and the wood deck sealed, an exercise facility requires safe and modern equipment. Twenty-four hour doorstaff is expensive. All buildings, however, have to be well maintained, and that includes regular tuckpointing, attractive lobbies, and safe elevators. A portion of the monthly HOA fee is put aside for future repairs, and another portion is used for current operating expenses.





Pre-war buildings provide steam or hot water heat to the units, and the heat is included in the HOA. However, owners in newer condos that have heat and air condition provided by the building, pay for the electric to run the fan that distributes the air and heat. Other condos have electric heat, paid by the condo owner based on their personal usage.





Parking Fees


Condo Buildings with Onsite Parking Garages


Older condo buildings built roughly between the 1960s and 1990s have onsite parking garages and you lease the space. The advantage of a leased parking garage is that guest parking is also available. The leased monthly parking expense is not included in the condo HOA fees so be sure to ask your agent what they are and if there is a range. Some condo buildings have outdoor spaces at a lower fee, self-park options at higher rates, and then, the most common, valet parking fees.


Deeded Parking


Condos in newer buildings have deeded parking spaces. You cannot lease a garage space in these buildings, there is no garage attendant, and there is no guest parking. The garages were built to only accommodate the condo owners’ cars.  You drive into the garage and park in your private space.  These spaces were offered at the initial sale of the building, so the first purchaser of the condo you may be considering  purchased one, two, and, possibly more spaces if the condo was exceptionally large. Each deeded space is considered a form of real estate and has its own PIN number – Property Identification Number and, therefore, an annual tax bill. There is also a small monthly fee to maintain the garage. These fees vary, so add that to your list of questions.





 If you do not own a car or, if the condo is offered with two spaces, your agent will likely stress the resale value of owning the condo with the deeded space or spaces. You can often lease the space to another owner in the building, but not to outside residents.


 Condo prices may or may not include the price of the deeded parking space, and, therefore, the HOA fees may or may not include the deeded parking monthly fees. As this information is listed in the MLS, your agent can quickly tell you what the deeded parking fee is and if it is included or will be in addition to the HOA association fee.


 


 


Jameson Sotheby’s International Realty


55 E Erie Street  1C


Chicago, IL 60611                   


 312.961.6212





Is it a buyers' or sellers' market? See real-time market data. Learn what's happening today. Choose condos or homes. Search by zip code. Streeterville 60611 Gold Coast 60610 Lincoln Park 60614 River North 60611 River North West 60654 New East Side 60601 South Loop 60605 Lakeview 60657
 ]]> </description>
    <pubDate>Sun, 08 Mar 2020 14:46:00 -0500</pubDate>
</item>
<item>
    <guid>https://www.chicagosluxurycondos.com/blog/what-credit-score-do-i-need-to-buy-a-house1.html</guid>
    <link>https://www.chicagosluxurycondos.com/blog/what-credit-score-do-i-need-to-buy-a-house1.html</link>
        <author>Linda@ChicagosLuxuryCondos.com (Linda Shaughnessy)</author>
        <title>What credit score do I need to buy a house?</title>
    <description> <![CDATA[ 
Your lender will look at scores from each of the three credit bureaus: Equifax, Experian, and TransUnion. Most lenders will then drop the highest and lowest and use the middle score in making their determination. Your credit score is affected by a number of different factors and plays different roles in different loan scenarios.  





 


How are credit scores calculated?


Credit or FICO scores are based on a combination of the following factors:




       Payment History (35)


       Amount of Credit Used (30)


       Age of Credit (15)


       Mix of Credit Types (10)


       New Credit Inquiries (10)




Credit Scores for All Types of Mortgages


Your credit score is affected by a number of different factors and plays different roles in different loan scenarios. The minimum credit score for your mortgage loan varies according to the type of loan you’re seeking, your down payment, and the agency or organization backing the loan.


 Here are some of the most popular types of mortgages along with their requirements.


Federal Housing Administration (FHA)


The FHA loan is a government-backed mortgage insured by the Federal Housing Administration and designed to assist low- and moderate- income homeowners with their home purchases. The minimum credit score for the FHA loan varies according to the down payment.


 For a down payment of 3.5 of the purchase price, the minimum credit score is 580. For a 10 down payment, the minimum credit score is 500.


Veterans Affairs (VA)


The VA loan is designed to help veterans and their families buy a home with no money down. While the VA does not designate a minimum FICO score, most lenders use 620 as their minimum, with some offering VA loans with scores as low as 580.


United States Department of Agriculture (USDA)


The USDA loan is designed to help buyers who are purchasing property in a designated rural area. While the USDA does not designate a minimum score, most lenders require a credit score of at least 640.


Conventional Loans


Conventional loans come in a variety of terms with a variety of requirements. They can differ significantly depending on the down payment requirements and the loan amount. Most conventional mortgages require a FICO score of 620 to 640.


Loans for Special Circumstances


There are a variety of ways in which your home purchase and credit history may fall outside of the normal guidelines for credit approval. In these cases, your lender may require a higher credit score, larger down payment, or additional documentation for approval. These include:




       Self-employed applicants


       Recently unemployed applicants


       Divorcing couples


       Applicants with a history of foreclosure or bankruptcy




 In addition, purchasing a luxury residence with a jumbo loan may subject you to more stringent requirements than purchasing a more modestly priced home. In these cases, lenders may require a FICO score of more than 700 and up to 720.


How do you raise your FICO score?


Because your credit score is based on a variety of factors, there are a number of ways to improve your score. Many of these take time, so it is important for you to start thinking about your credit score well before you are ready to apply for a home loan.


 Here are seven great ways to improve your FICO score according to Experian:


1.    Pay your bills on time.


It is easy to let payment due dates sneak up on you, but paying your bills on time has a big impact on your credit score. If you have a hard time keeping track, consider using automatic payments or online bill pay to pre-schedule your payments every month.


2.    Get credit for on-time utility and cell phone bill payments.


Some services offer tracking for utility bills, apartment rentals, and other types of accounts in order to allow you to build a positive credit history. This can be especially helpful for building your credit when you begin working or for rebuilding your credit after a bankruptcy.


3.    Pay off credit cards and keep balances low.


Carrying a large balance can create difficulties when trying to qualify for additional credit for a home purchase. Start early paying off your credit cards or, if you can’t pay them off entirely, try to keep the balances low.


4.    Don’t open new credit accounts too often.


The best way to avoid overextended credit is to avoid opening up accounts in the first place. Don’t apply for retail credit cards in order to get a one-time discount. You’ll save far more money by paying cash and avoiding that extra credit account.


5.    Don’t close paid-off, unused credit accounts.


You’ve paid off those credit cards. Congratulations Be sure, however, that you leave the accounts open. That shows that you can be responsible with credit and that just because you have credit available doesn’t mean you’ll use it for a shopping spree.


6.    Don’t apply for multiple accounts, resulting in numerous inquiries.


If you know that you’ll be applying for a mortgage, put off that new car or furniture purchase. Every “hard” credit inquiry causes a dip in your credit score. Just one or two of those hits in the days leading up to your mortgage approval could mean the difference between a yes or a no.


7.    Check your credit report and dispute any inaccuracies.


Mistakes happen but you shouldn’t have to pay the price. If a company incorrectly reports a late payment or fails to update an error in billing, you’ll need to contact them and have your credit report corrected. In fact, check your credit report each year in order to stay ahead of any possible disputed items.


                                                                                                    Do you need a pre-approval letter to make an offer ~ Read More


 


Jameson Sotheby’s International Realty


55 E Erie Street  1C


Chicago, IL 60611                   


 312.961.6212



 ]]> </description>
    <pubDate>Sun, 01 Mar 2020 21:22:00 -0600</pubDate>
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