Posts byPeter Thompson

Training Chicago Area Realtors on how to work with FHA 203k and Homestyle Renovation Loans

One of the biggest issues for buyers looking for new homes in the Chicago area, has been the shortage of inventory for quality properties. Homes that show well and are priced right have been selling quickly all year long. But there are a lot of other properties that may be in good neighborhoods, that are sitting on the market a lot longer. These are the properties that might have some issues. Sometimes it is deferred maintenance, sometimes the home is just outdated and doesn’t show well. Either way, most borrowers are looking for homes that are in move in condition, and these homes don’t even show up on their radar. But these homes can be a great opportunity for buyers with imagination. These homes are neglected because they don’t have the amenities today’s buyers are looking for, but with a renovation loan, you can fix and improve a home, changing it into the home you…

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FHA 203k Eligible Property Types in the Chicago Area

  There are a lot of ways you can use the FHA 203k  and Homestyle rehab and renovation loans if you are buying a home in the CHicago area. This video goes over some of the uses, including how you can buy a 2-4 unit apartment building, use the renovations to increase the rents, which will add more value. Loan Depot Interview Between Peter thompson and Milton Minolas on  what property types are eligible for FHA 203k and Homestyle Renovation and rehab loans in the Chicago area Pete: Hi. This is Pete Thompson your Chicago area mortgage guy, and I am here with Milton Manolas, our national renovation expert. Today we’re going to talk a little bit about property types. When most people think of renovation loans, they’re thinking of houses that are falling down, but it’s not just single family homes that you can do with this and it’s…

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FHA 203ks can be Part of the Solution to the Chicago Area Housing Inventory Shortage

Chicago FHA 203k Renovation loans  A lack of inventory for the homes that buyers have been looking for has been number one problem in the Chicago area housing market for most of the last year. And lately, the problem just seems to be getting worse.  If a home is in a good neighborhood, is in good condition and is priced right, it is going fast. Most of the time with multiple offers. At the same time, there are a lot of homes in great neighborhoods that aren’t selling right away. A lot of the time it is homes that are in a good location, but they just don’t show as well. These homes might not have been maintained as well, or they could have outdated features, or maybe there are serious problems that need to be fixed before they can even get financed. These homes tend to have lower sales prices, and less…

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What is the Process and Timeline for Getting a Chicago Area Renovation Loan?

  If you are looking to buy a home in the Chicago area, you probably know that the market is tight. There are a lot of buyers looking for the same types of property (well maintained, up to date homes that are priced right), and whenever a new listing comes on the market, there is a waiting line of buyers ready to view it. And often, ready to make offers. At the same time, there are a lot of homes that just don’t get as much love and respect. These are older homes, homes that haven’t been updated, need some work or just don’t have the curb appeal that buyers are looking for. It’s not unusual for these homes to stay on the market longer, and sell for less. But these ugly ducklings can be swans in disguise. If you are open to considering homes that might need some work,…

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Why Are Appraisals Important?

  Who Does the Appraisal? When an appraisal is done, an unknown, third-party, qualified professional is brought in to examine the property. The buyer and lender do not have the ability to choose the appraiser. This person will go to the property and look at the amenities of the property, and then compare that to all the properties that have sold in the area to determine a fair market value for your home. Is the Appraised Value Acceptable? A lender will look at the appraised value of the home, and compare that value to your contract price, whether you have bought the home or are doing a refinance. After the appraisal, the lender needs to check that the appraised value is acceptable, and also determine the condition of the home to see whether any improvements need to be made. In some cases, such as with FHA renovation loans, a list…

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Who Can Qualify for a VA Loan?

                        VA loans, or loans through the Veteran’s Administration, are special loan programs for veterans that require qualification. If you are looking at VA loans, you have probably heard of some of the great benefits: you can buy a home with no money down, you do not need monthly mortgage insurance (rather, there is just need a one-time funding fee built into the loan), and you get a competitive interest rate with low closing costs. It is probably one of the best loans out there and was designed for those who have served our country. Do You Qualify? If you have been in the Armed Forces, such as the Army, Navy, Air Force, Coast Guard, Marines, National Guard, or their reserves, you could be eligible. The VA loan program is inclusive of both active duty and qualified veterans. If…

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What Questions Should You Ask Your Lender When Applying for a Loan?

          When shopping for Chicago Area renovation loans and FHA 203k renovation loans, what questions should you ask your lender to be sure they are qualified and ensure a smooth process? Renovation loans are popular because they are flexible: you can take a property in need of a lot of work, and turn it into a good-as-new home, or find a home needing minor updates and make it the way you want. Checking Lender Experience While many lenders say they do renovation loans, it is important to find out how many they’ve actually done. One of the most important things to determine is the amount of experience your lender has with renovation loans. Renovation loans are different than traditional mortgages. Not only does the borrower need to be approved, but contractors doing the renovations need to be involved as well. Everything that needs to be done…

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Making Income Changes While in the Process of Obtaining a Mortgage

                  What happens if you have to change jobs while you are in the middle of getting a mortgage? Lenders typically recommend that you do not make major changes if you are in the middle of trying to get a mortgage, because lenders look for continuity, and will have to re-verify information if major changes are made. However, many folks do not have a choice: sometimes a new opportunity comes up, or are forced to change jobs. The good news is that lenders can work with you, and use the new information (income, salary, etc.) from your new position for your qualifying. This process can be started with just an offer letter, so the terms (salary, start date, etc.) are known to get the process started. Typically, at least one pay stub will be required before closing to show that you have…

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What Can You Do with a Chicago Renovation Loan?

      What specifically are you allowed to do with a renovation loan? The real question is, “What can’t you do?” because there is a lot of flexibility with this type of loan. What can you do with a Chicago Area Renovation Mortgage? There are many different ways to use this program. There are three basic types to look at: FHA 203k renovation loan: a great way to get a government-insured property with as little as 3.5% down, including costs of repairs Homestyle renovation loan: better if you have a bit more of a down payment VA renovation loan: includes special benefits for veterans and disabled veterans The good thing about renovation loans is their flexibility: you can use it for something that just needs a little bit of work or a home that needs a tremendous amount of work. It doesn’t matter what the condition of the property…

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What Mortgage Programs Are Available to Veterans?

If you’re a veteran or a disabled veteran, what special programs for buying a home are available to you? If you served your country, you can take advantage of the Veterans Administration Loan Program that allows you to get 0% down on a home loan. In addition, there are other benefits with a VA loan, which will be described below. Funding Fee When setting up a Veterans Administration loan, a funding fee is attached to the mortgage. VA loans do not require mortgage insurance, as with typical mortgages when you put less than 20% down. However, there is a one-time funding fee that is added back into the mortgage. The amount of the funding fee depends on whether you were active duty, or served in the National Guard. However, if you are a considered a disabled veteran, this funding fee is waived and can save you money up front. Real…

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