Many of you may not be currently thinking about buying a home as the North Shore’s recent snowfall is keeping us all content to be in our warm homes. However, as you have time to be indoors and consider your current home; you may begin to think of your goal to buy a North Shore home this year. Whether you’ve been considering this for some time or have only recently begun to think about a new home purchase, I can assure you that now is a great time to buy a home!With the low mortgage rates that are expected to remain throughout the year, many have been inspired to buy their North Shore home before the busy spring season. In a recent article by real estate expert Shobhana Chandra, it’s noted that in December alone, sales increased an overwhelming 12 percent! The encouraging news is that these were existing homes; which is great news for sellers as well!
It seems the housing market is clearly on the steady incline to recovery, and this is seen in Chicago’s North Shore Real Estate market as well. Senior economist at Moody’s Analytics Inc., Aaron Smith pointed out that, “Sales have been recovering steadily from a depressed level. A better economic backdrop should boost confidence and push potential homebuyers off the sidelines.”
If you do plan on buying a North Shore home, you’ll want to know that there has been a change in mortgage guidelines for 2011. In hopes of bringing the market to full recovery, lenders have tightened the reigns on qualifying for a mortgage loan. These four tips should be helpful as you begin to get things in order to buy a North Shore home.
1. 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.
2. 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.
3. 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.
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 pain over time instead of up front.
If you have any questions about where the North Shore Real Estate market is currently at, or have questions about qualifying for a mortgage loan; please let me know! I know the housing market can be overwhelming at times, and having someone to guide you along the way is important in having a stress free home buying experience.
Finding a North Shore Real Estate agent can be a process in and of itself, but I’d love to offer you my services as I have years of experience with buyers and sellers in the North Shore Real Estate market. Please feel free to contact me anytime. I look forward to hearing from you!
Janie Bress
Your North Shore Real Estate Expert
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