5 Tips for First Time Homebuyers in Illinois
Looking to break your lease agreement and take on the independence of owning your own home? Here are 5 tips for first time homebuyers looking to purchase a home:
1. Location, Location, Location! You’ve heard it before, location is key when you’re buying your first home. Be sure to take into consideration the surrounding area, specifically when it comes to the value of your home. While you may spend more, it is better to buy in an area that is a stable market, as your home will retain in its value come resale time. Also, look at key area features like school districts, nearby shopping or dining, and proximity to transportation like train stops. These features will make an area more desirable and thus lead to a stable or increased value over time.
2. Type of property. In some areas, like downtown Chicago, condos are very desirable. Certain features of condos can lead to trouble when it comes to mortgage financing. Be sure that your realtor asks the right questions before you put down earnest money on a condo that isn’t financeable. Additionally, condos have other fees like association dues that single family homes do not. Association dues will play into how much you qualify for when you buy a home, be sure to pay attention to this important detail.
3. Less is more. With interest rates still near historic lows borrowing more makes sense. You can still obtain conventional financing and put as little as 3.5% down on a property. Lesser down payment at a low interest rate can expand purchasing power for first time homebuyers. When looking for a home, be open to different types of program to create the possibility of purchasing your dream home.
4. Good vs. Bad Debt. All of your monthly liabilities factor in to the qualification process. Any monthly payment you have will affect how much you can afford when it comes to buying a home. For example, your car payment, credit card payments, and student loans are all included in your debt ratio. Even if your student loans are in deferment, the monthly obligation will be factored in to your liabilities. This guideline can lead to many issues for first time homebuyers.
5. Get Pre-Approved. The easiest way to avoid the heartbreak of not being approved for your dream home is getting pre-approved. United Home Loans offers a simple, non-invasive and fast pre-approval to aid homebuyers that are on the go! Find out a specific price range or get approved for a certain property by trying out our link below!
Questions? Contact us below or call 708-531-8388.