Chicagoland Home Buying Process
The process of buying a home is similar for all buyers. There are many important steps from establishing a price range to closing of a transaction. Following those steps closely will make the process of buying more efficient and less painful.
First step is establishing how much home can you afford.
Lenders have pre-determined formulas calculating the ratios of income to debt in order to establish maximum monthly housing cost. And yes, your existing debt matters. Student loans, car payments credit card debt, they all affect your monthly P.I.T.I. (principle, interest, taxes, insurance) and monthly assessments, if applicable.
For more specific details and numbers, you can talk to Liz at 773-430-3000.
Second step is deciding on the location and the type of home best suited for you.
When choosing the location variety of factors will play a role. Choice of a school districts, proximity to employment and transportation, property taxes, appearance of the neighborhood, entertainment and recreation are all important. Single family homes, townhouses or condos are all different and present variety of concerns that play in final decision making. Due to current market conditions, Chicago condos have to be evaluated carefully. To discuss pros and cons you need help of a resourceful real estate professional who will honestly present the findings to you.
Thirds step is preparing and presenting your Purchase Offer.
In Illinois, a real estate contract have to be submitted to seller in writing. It usually states your price, financing terms, dates for approval and closing and an earnest money deposit you are willing to offer. The seller may choose to accept, reject or counter your offer with different terms or pricing. Once both parties, the seller and the buyer agree, your offer becomes a contract.
Your real estate professional will make sure that all the continent deadlines are met and the contract stays in force.
Fourth step is applying for a mortgage.
No two buyers are alike, so what is good for your friend is not necessarily good for you. You employment history, credit score and cash on hand for the down payment will determine the type of mortgage available. Condition of your property and financial health of homeowner associations will affect available financing as well. Financing options have changes a lot lately. Lenders are much more cautious in underwriting new loans. When you work with a trusted professional you will be able to compare financing options that suit you best.
Fifth step is your closing.
At the closing you and the seller will meet and complete the conditions of the contract by signing numerous documents. Your lender will deliver a loan package in which you all the mortgage terms and conditions will be specified. Your attorney will make sure that the language of those documents is correct and there no mistakes in calculations. The seller’s existing mortgage will be paid off, free and clear title insurance will be issued and all the repair credits will be given. You will receive a settlement statement, commonly known as HUD-1. It will show all the fees that have been paid on your behalf in order to close the transaction.
As you see, the process of buying a home is quite involved. You do need knowledgeable and trusting professionals in order to avoid unnecessary complications. Over the years, hundreds of families have put their trust in Liz. Her experience and continuous education will protect and help you too. Feel free to contact her at 773-430-3000 for a consultation.