4 Financial Questions to Ask Yourself When Buying a North Shore Home

Are you financially prepared to buy a home on Chicago's North Shore?

Your Finances & Buying a Home

When contemplating the purchase of a home on Chicago’s North Shore, you must consider your financial standing very carefully. Evaluating your finances goes beyond just looking at your credit, as there are many other financial considerations involved. But what are those considerations? Here are 4 questions to ask yourself when considering the purchase of a North Shore home:

How much can I afford? Your mortgage payment should not exceed 30% of your net household income. While the amount will vary based on the type loan that you are trying to obtain, you will also need to have liquid cash available for a downpayment as well. There are many mortgage calculators available to help you get an estimate of what you can afford. You will also want to account for additional monthly costs, such as insurance and taxes.

Do I have a firm budget in place? Before purchasing a home, it’s important to have a budget in place. A budget will help you monitor you money more closely, which will be very important as you go through the approval process for a mortgage. It should be reevaluated often to ensure that you are staying on track and that no adjustments need to be made. Maintaining a budget can also help you pay down debt and put more money into savings.

How does my credit look? Your credit rating is highly important when purchasing a home. The second that you begin considering the purchase of a home, you should obtain a copy of your credit report. Verify the accuracy of your report and also evaluate your debt-to-credit ratio. Derogatory marks on your credit or too much  revolving debt can prevent you from getting approved for a loan. A strong credit rating can also help you get a lower interest rate.

Should I get pre-approved? While not required, it is a very good idea to get pre-approved for a mortgage if you feel you are ready to start seriously looking for a home. This is the only way that you will know the actual amount that you will be able to finance. Your offer will also be more appealing to sellers because a pre-approval assures them that you are financially capable of purchasing the home.

Especially into today’s stringent lending environment, having a strong grasp on your finances is incredibly important if you are looking to buy a North Shore home.  Asking yourself these 4 questions will help you determine if you are financially prepared to buy a home on Chicago's North Shore.  If you feel like you and your finances are ready to buy a home, the next step is to find an experienced North Shore realtor to help you through your home search process. It would be my pleasure to assist you in finding the perfect North Shore home to suit your needs, so please contact me today to start your home search!

Janie Bress
Your North Shore Real Estate Expert

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