Tuesday, May 10, 2011

4 Tips for Qualifying for a North Shore Mortgage Loan!

It seems that spring is officially here to stay as we enjoy today’s summer-like weather in Chicago’s North Shore!  Those of you who currently live in one of the great North Shore cities such as Evanston, Northbrook, Skokie or even Chicago know that the Chicago North Shore area is bustling with activity all year round, but especially in the summer months.

As North Shore Real Estate agents, this is always an exciting time of year as we see the housing market constantly being updated with new homes for sale, as well as buyers who eagerly pluck these beautiful homes off the North Shore Real Estate market!  It’s great to see the housing market continually pushing towards full recovery and the active market is a sure sign it’s well on its’ way!

While it may seem a little daunting to join in the busy real estate season and attempt to compete for your ideal North Shore home, you’ll have no problem if you do some pre-work prior to beginning your house hunt.  Many of you have heard about the changes that have been made to qualifying for a home loan, and the fact that lenders have tightened the reins in order to cut down on future foreclosures.  Yet this is not a reason to get discouraged about buying a North Shore home

There are four key things you can do to ensure that you’ll qualify for a mortgage loan, and before you know it, you’ll be hunting for your ideal North Shore home!

1. Have the right credit score- Credit scores are moving to the forefront of being approved for a North Shore home loan.  Most lenders are expecting a credit score of 600+ even for FHA loans.  A good credit score will not only help you qualify for a home loan, but can lower your interest rate, which can save you thousands of dollars in the long run.

2. Shop around- The interest rate is important, but there are other costs to consider such as discount points and even the type of mortgage loan. When shopping for best rates, compare various combinations of discount points and loan types. Your North Shore Real Estate agent can help you decide on the best option.

3. Know your borrowing limit- If you’re not sure how much you want to borrow, a good rule of thumb is to look at the Federal Housing Administration requirements.  FHA will limit mortgage payments at 31% of gross monthly income before taxes for most buyers.  This can help ensure that you’re not getting in too far over your head.  If we’ve learned anything over the past few years, it’s to play it safe in the housing market. 

4. Consider a No-Closing-Cost Loan- If you have positive equity, but are lower on cash up front, you do have an option to choose a no-closing cost loan.  This simply means that you’ll have a slightly higher rate, but the closing costs will be paid over time instead of up front.

If you have questions about any of these tips on qualifying for a home loan, or about the North Shore Real Estate market, please let us know!  We’d love to show you current homes available in Chicago’s North Shore and Chicago as well as take the time to answer your questions.  Buying a home is a large decision and you shouldn’t have to go through the process alone.  As North Shore Real Estate agents, we have years of experience and would be happy to help you each step of the way. 

We look forward to hearing from you!

The Thomas Team
@ Properties

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