You may be watching both home prices and mortgage rates tick upwards in today’s unpredictable real estate market, wondering if buying a home right now is your best bet. While it may be an expensive endeavor, your goal of owning a home in Glencoe, Winnetka, Highland Park, Deerfield, Northbrook, Lake Forest, Wilmette, Evanston, Glenview, Riverwoods, Bannockburn, or the surrounding North Shore communities is not out of reach.
There are many strategies for saving money and staying on budget while buying a home on Chicago’s North Shore and as your local real estate expert, I am listing four to try below. Continue on for top tactics for becoming a homeowner in the current real estate market.
Get a Low or No Down Payment Loan
If the thought of putting 20 percent down on a home causes you stress or makes you want to toss your homebuyer dreams out the window, take a deep breath. Many homebuyers are in the same position and you may just find that you qualify for a loan program that requires a low down payment— or nothing down at all! For instance, an Federal Housing Administration (FHA) loan allows you to put down as little as 3.5 percent, so long as your credit score is above 580.
Many of these down payment requirements vary by lender so it’s always best to touch base with yours first to see what is available to you.
Research Down Payment Assistance
If you still find the down payment to be your biggest obstacle to purchasing a home in Glencoe, Winnetka, Highland Park, Deerfield, Northbrook, Lake Forest, Wilmette, Evanston, Glenview, Riverwoods, Bannockburn, or the surrounding North Shore communities, try researching down payment assistance programs in your area. Some programs qualify buyers for grants, zero-interest loans, and other opportunities to make the down payment on a home. To find programs in your area, visit state housing finance authorities or the homebuying programs page on the HUD website.
Use a Family Gift
Some homebuyers have family members who gift them funds to use as a downpayment and while this is a perfectly acceptable option, know that it comes with rules.
Lenders will look into your financial history, your credit score, employment, and income, as well as research where your assets, like said gift, came from. A lender will want to confirm whether the lump sum a family member or friend gave you was indeed a gift or a loan. If the loan needs to be paid back, it could interfere with your ability to make upcoming mortgage payments. You will also need to obtain a gift letter that states the amount of the gift and confirms that it does not need to be paid back.
Keep Your Eye on Foreclosures, Short Sales, Auctions, Etc
Everyone loves a deal, especially on a home— so be sure to keep your eyes on foreclosures, short sales and auctions in the Chicago area. Short sales are typically conducted to spare the bank the hassle of a foreclosure and it can be a helpful way to find a home at a great price.
I am happy to help you navigate the market in Glencoe, Winnetka, Highland Park, Deerfield, Northbrook, Lake Forest, Wilmette, Evanston, Glenview, Riverwoods, Bannockburn, or the surrounding North Shore communities this year! Give me a call today to get started on your home buying journey.
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