How Your Tax Refund can Help You Become a Chicagoland Home Buyer

How Your Tax Refund can Help You

Become a Chicagoland Home Buyer

If you're one of those estimating you'll receive a refund on your taxes ... and you dream of buying a Chicagoland home in the future ... now is the perfect time to:

• Get Started 
• Ask your financing questions 
• Discover what options you have to borrow and buy 
• Position yourself for the mortgage best suited to your needs
• Contact Me

The refund money you receive can be extremely helpful in buying a home.  A common use for the refund money is to use it as a downpayment on a home.

There is good news for those hoping to do just that.  Why?  There are presently many mortgage options available for hopeful homebuyers to consider and use.  Those include many that require only small down payments.  (Note: It's a myth that you need 20% down to buy a home.)  

The following are examples of mortgage options that are available (when qualified) to Chicagoland area home buyers/borrowers with smaller/no down payments saved:

• 3.5% Down Payment FHA loans 
• 0% Down Payment VA loans (Qualified Veterans) 
• 3% Down Payment Conventional loans 
• 0% Down Payment USDA loans (Eligible Applicants – Eligible Locations)

Also keep in mind:  Many states and local municipalities have grants or resources available for Borrowers in need of Down Payment Funds.

But it's also true that your tax refund can help you qualify for mortgage financing (that's where I come in) ... or simply put you in a better place financially after you've purchased. 

During your mortgage analysis, I'll help you find the best and wisest use for your refund monies.  And where their expenditure makes most sense and positions you best to qualify for the mortgage needed at the time of purchase.

However, we may find that it's most advantageous for you to think "outside the downpayment box" with your tax refund.  

Your monies may be best spent:

• Paying down some credit cards, which in turn will raise your credit scores
• Growing your "Reserve Funds" 
• Paying your Closing Costs
• To pay-off a smaller loan (car loan, etc.)
• To pay-off a Collection
• As Earnest Money towards your purchase
• To eliminate Private Mortgage Insurance
• More ...

Just as coaches and players must have a "game plan", plan ahead to position players on a field, and to successfully play and win games ... so must hopeful home buyers plan and position themselves for success when buying and financing a home.

Fact is though until you and I analyze your present financial position and your future financial goals, you won't have a game plan.  You won't know how to use your tax refund most advantageously ... or most easily reach your home buying goals.  

Another reason that tax refund time is the perfect time for us to talk?  It revolves around the documentation that is required when getting a loan. 

Mortgage Lenders need to view tax returns (latest 2 years), W-2's, and more in order to pre-qualify you for a loan and to assist you in mortgage application.  At tax filing time, you'll simply have the numbers and documents from your accounts and tax filing fresh in your mind, at your fingertips, and readily accessible.  

For those that might find this portion of the financing process a challenge, tax refund time is a godsend.  It makes it "easy breezy", as they say.

Even if you're thinking that buying a home is a year out or more, it makes sense for us to have a preliminary talk now.  You'll have a better understanding of your present credit standing and finances.  

Plus, you'll move forward with a more clear plan in mind.  A plan that will help you eliminate any present financial or credit issues that may exist ... and place you in a much better position as you grow closer to mortgage application.  

Receiving a tax refund?  Is New Lenox - Will County - Chicagoland home buying in your future?  Let's talk ...

(Remember:  You have until Monday, April 15, 2019, to file 2018 returns and pay any taxes due.)

* Hoping to Buy or Refinance a Home in New Lenox or elsewhere in the Chicagoland area?  Contact me!  I'll put my 40+ years of Mortgage experience and expertise hard to work on your behalf.
     I'm easily found at:

Gene Mundt

Mortgage Originator - nmls #216987 - IL Lic. 031.0006220 - WI Licensed

American Portfolio Mortgage Corp.

nmls #175656

Direct: 815.524.2280

Cell or Text: 708.921.6331

eFax: 815.524.2281

www.genemundt.com

gmundt@goapmc.com

              

       

Gene Mundt, Mortgage Originator, an Originator with 40+ years of mortgage experience, will offer you exemplary mortgage service and advice when seeking: 

Conventional, FHA, VA, Jumbo, USDA, and Portfolio Loans in Chicago 

and the greater Chicagoland region, including: 

The Lincoln-Way Area, Will County, (New Lenox, Frankfort, Mokena, 

Manhattan, Joliet, Shorewood, Crest Hill, Plainfield, Bolingbrook, 

Romeoville, Naperville, etc.), DuPage County, the City of Chicago, 

Cook County, and elsewhere within IL & WI.

Referrals are Appreciated and Welcomed!

  



     

Buyer's Guide to Closing Costs Credits

Buyer's Guide to Closing Costs Credits

Closing Costs ... people are always interested in them.

HOW they can be paid, borrowed, financed ... and possible credits for Closing Costs that might be available to them from their Sellers or their Lender. 

I find that many of my new clients have preconceived notions about Closing Costs.  Or they're just plain confused by them.

And it's easy to understand why this can be the case.  The differing loan types ... Conventional, FHA, VA, USDA, Jumbo loans ... all have varied Rules and Guidelines.  It can be tough for new Borrowers to wrap their head around all of it. It's a lot to digest. 

Adding to the confusion:  In some cases, the amount of down payment made on the purchase can affect the amount of allowed credits received from a Seller.  

Yep.  See what I mean?  It can seem a bit overwhelming. 

That's why, when I hold my initial conversations with Borrowers regarding Closing Cost options, I begin at the beginning ... with the basics.  That means an explanation of what Closing Costs are.  

My explanation always includes a list of those cost items that are "Pre-Paid" ... meaning they are funds needed to Close on a Conventional Loan in addition to the Down Payment made.

In previous articles, I've discussed the various programs available for Home Buyers with Conventional Financing, but suffice it to say ... 3%, 5%, 10%, 15%, and 20% Down (or more) programs are prevalent today.  

For those making Investment Property purchases: 

The rules regarding the Seller's contribution towards Closing Costs is straightforward and clear-cut.  The Seller can contribute no more than 2% of the Sales Price if negotiated into the Contract. 

Here's an example:

Purchase Price = $200,000 

 X  2% 

=

Seller-Paid Contribution of $4,000

It must be noted:  It's possible that the Lender can credit back some or all of the Closing Costs, either in the form of a lump sum or a percentage (%) of the Loan Amount.  I've found that typically my Borrowers will absorb or accept a higher interest rate as a trade-off for receiving that Closing Cost credit.

In NO case, can Closing Costs owed by a Borrower, be "rolled into" the loan amount on a Conventional Loan.  Certain program costs can be allowed when utilizing FHA, VA, and USDA financing, however.

For Owner-Occupied purchase transactions, the allowed Seller-paid Closing Costs vary according to the Down Payment percentage (%).  (Conversely, the Loan-to-Value (LTV) Percentage).

Those variations are shown in the table below: 

These stated credits can be used to offset (pay for all or part of) the true Closing Costs related to:

• Title Fees
• Lender
• Appraisal Fee
• Attorney Fee
• Credit Report
• Flood Certification Fee
• Points
• Etc. 

... as well as pre-paid items, which generally are set aside for:

• Real Estate Taxes
• Homeowners Insurance 
• Interest Charges
• Home Owners Association Dues (if applicable)
• Mortgage Insurance Premiums (initial or renewable) 

As you can tell from the info provided above, there are many scenarios available for Buyers' consideration prior to their making a request for Seller-paid Closing Cost assistance.  

Each Buyer has their own individual and unique finances, needs, and circumstances that contribute to the final outcome.  I will (or your own Lender will) conduct a thorough analysis of all options available to you ... and then discuss them with you.  Once that is completed, you'll be able to make a sound decision regarding your Closing Cost request.

Buyers need to know:  It's almost impossible for Buyers to go back and ask for Seller-paid Closing Costs assistance AFTER a Contract has been signed.  Having your discussion with me (your Loan Officer) and your Realtor ... proactively, early, prior to entering into Contract is vitally important and wise.

Need more info?  Have questions regarding your Chicagoland home buying and financing?  Let's talk today!

    

   

* Hoping to Buy or Refinance a Home or Investment Property in the Chicagoland/IL/WI area? Contact me! I'll put my 40+ years of Mortgage experience and expertise hard to work on your behalf.
I'm easily found at:

Gene Mundt

Mortgage Originator - NMLS #216987 - IL Lic. 031.0006220 - WI Licensed #216987

American Portfolio Mortgage Corp

NMLS #175656

Direct: 815.524.2280

Cell or Text: 708.921.6331

eFax: 815.524.2281

www.genemundt.com

gmundt@goapmc.com

              

        

Gene Mundt, Mortgage Originator, an Originator with 40+ years of mortgage experience, will offer you exemplary mortgage service and advice when seeking: 

Conventional, FHA, VA, Jumbo, USDA, and Portfolio Loans in Chicago 

and the greater Chicagoland region, including: 

The Lincoln-Way Area, Will County, (New Lenox, Frankfort, Mokena, 

Manhattan, Joliet, Shorewood, Crest Hill, Plainfield, Bolingbrook, 

Romeoville, Naperville, etc.), DuPage County, the City of Chicago, 

Cook County, and elsewhere within IL & WI.

Referrals are Appreciated and Welcomed! 

Thinking of Buying a Chicagoland Condominium? Get Educated and Informed ... it Matters

 Thinking of Buying a Chicagoland Condominium?

Get Educated and Informed ... it Matters

Many home buyers, especially first-timers, don't know about (or are confused by) the differences that exist between condominiums and townhomes.  

They also don't know that those differences can trickle down to how ownership is held on these properties ... 

The fact that the differences between these properties are not always something that can be easily seen visually ... definitely adds to this problem.  The differences between the two can be almost indiscernible.

So it becomes vitally important, when considering a purchase of either type of property, that Buyers work with a Chicagoland agent and mortgage originator that is thoroughly educated and experienced in their transacting and financing.  

This education and experience matter greatly.  And it's an area where my background and experience, including 20 years of Chicagoland real estate appraising experience, offer my Borrowers/Buyers a definite advantage.

In this article, properties legally classified as Condominium will be the focus.  The property, typically referred to as a "Unit", will lie within a legally platted condominium site and a legal "Condominium Association". 

The property has been established ... and recorded ... as such.  The recorded documents established the Declarations and By-Laws, and any/all rules (covenants) that outline, detail, and mandate how the Condominium Association is run.

What Chicagoland Buyers/Borrowers of Condominiums need to know:

• When buying an individual condominium unit, you're buying the individual rights to that unit
• The other unit owners (and you) are "equal owners" of any commonly owned facilities within the project.  
• Those facilities and services (if they apply to your Association) can include:

       *  First:  Common areas are defined as those areas of multi-owner real property which are meant for the exclusive use of all individual owners.
       *  Common Areas such as: Hallways, Laundry Rooms, Storage Areas, Balconies, Patios, Mechanical Rooms, Parking Lots, Driveway Access, etc.
       *  Common Areas where: Recreational Facilities are found, such as green areas, Playgrounds, Water Retention Areas, Pools, Tennis Courts, Exercise Facilities, Security Gates, Party, Clubhouse, or Recreation Rooms, etc.
       *  HOA Services:  Snow removal, landscaping, etc.

Common Areas need to be maintained and paid for.  This is done via the "Homeowners Association Dues/Fees" which are typically paid monthly, paid directly to the Association (or its professional management company).

Also:  Many Condominium Homeowner Associations maintain rules that must be adhered to by its Owners.  They're called Covenants and Conditions and Restrictions (CC&R).  Prospective Buyers should ask if the property under consideration falls under these rules prior to entering into Contract.  

Common CC&Rs cover:

• Pet Ownership (What breed, how many, where they can be walked)
• Noise Restrictions
• Smoking Restrictions 
• Parking Restrictions
• Use of Clubhouse, Pool, Tennis Courts, etc.
• More ... 

It's important for Buyers to know:  Homeowners Association Dues/Fees are included in the Mortgage Lender's Monthly Housing Expense Calculations.  

The amounts and dues/fees paid can vary greatly from one Association to another, as you can imagine. Most typically, the more upscale or more amenities offered, the higher the Association dues/fees are.  

Those dues/fees can have a huge impact on a Buyer's Monthly Payment.  That in turn, can affect the outcome of a Buyer's Loan Approval. 

How and Why is that true?    

The impact on the Buyer's Monthly Payment directly relates to the "Debt-to-Income" analysis conducted for financing. Debt-to-Income is calculated by dividing the total recurring monthly debt by the Borrower's Gross Monthly Income.  The DTI (Debt-to-Income) is expressed as a ratio or percentage (%) figure.

Buyers considering a Condominium purchase can ill-afford to be caught off-guard regarding the type of property they're purchasing ... or the Association Dues/Fees that may accompany it.  Buyers need to possess information regarding the true definition of "Condominium" and "Planned Unit Development" (PUD) and a thorough understanding of each. 

The health and standing of the Homeowners Association under which jurisdiction the property lies is as important for a Buyer to know as the Sales Price (and condition) of the property.  The same goes for the Real Estate Taxes that accompany the property.

Buyers need to ask the following questions about the financial stability of the Homeowners Association:

• What is the budget of the Association? 
• Is the Association financially sound?
• Are there repairs needing to be made to the Building's exteriors?
• Are repairs needed or planned for any common areas?
• Are there any upcoming "special assessments" for Buyers?  (If major expenses arise within the project, and the Homeowners Association does not have the money (reserves) to pay for them, the Association may charge an extra assessment fee to HOA property owners)      
• What increases in Fees/Due have occurred in the past?
• How large were the past increases?
• More ...

Also important to know:

• How is the HOA governed?
• Are rentals of properties allowed?  If so .. how many?
• What insurance does the HOA have?
• More ...

I can't stress enough just how important it is for potential Condominium Buyers to become informed and educated about Condo Ownership ... to gain full knowledge about the specific property they're considering ... and the health of the financial health of the Condominium Association involved ... prior to the signing of any Contract.  

Ask questions of your Agent and me, your New Lenox - Chicagoland - IL/WI loan officer. Gather facts.  Do your homework well and proactively.  

Thinking of buying a Chicagoland Condominium?  Get educated and fully informed prior to signing a Contract. 

What you find out and learn matters.  To the quality of life, you'll lead.  To your financial health ...

    

     

* Hoping to Buy or Refinance a Home or Investment Property in  Chicagoland - IL - WI? 

Contact me! I'll put my 40+ years of Mortgage experience and expertise hard to work on your behalf.

     I'm easily found at:

Gene Mundt

Mortgage Originator - nmls #216987 - IL Lic. 031.0006220 - WI Licensed #216987

American Portfolio Mortgage Corp.

nmls #175656

Direct: 815.524.2280

Cell or Text: 708.921.6331

eFax: 815.524.2281

www.genemundt.com

gmundt@goapmc.com

 

              

 

Gene Mundt, Mortgage Originator, an Originator with 40+ years of mortgage experience, will offer you exemplary mortgage service and advice when seeking: 

Conventional, FHA, VA, Jumbo, USDA, and Portfolio Loans in Chicago 

and the greater Chicagoland region, including: 

The Lincoln-Way Area, Will County, (New Lenox, Frankfort, Mokena, 

Manhattan, Joliet, Shorewood, Crest Hill, Plainfield, Bolingbrook, Channahon,
Lockport, Romeoville, Naperville, etc.), DuPage County, the City of Chicago, 

Cook County, and elsewhere in IL & WI.

Your Referrals are Appreciated & Welcomed!