Honest Real Estate Advice

Ok here is my deal

I have been renting an apartment for the past year and a half and am ready to purchase a home. I have saved up about 10 grand for a down payment and am looking for a 1 or 2 bedroom condo in the Chicago area.

My problem is I am on the younger side and don't know that much about buying a home. I'm looking for a condo in the 130-175,000 range. How do I go about doing this, what kind of mortgage options are available? Do I qualify?

Any and all advice will be appreciated

Start pulling your credit reports from all 3 bureaus and make sure all the info is correct. Make sure there are no mistakes that may bring down your credit rating. A low credit rating will get you a crappy (higher) mortgage interest rate.

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Q: How do I order my free report?

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You may order your reports from each of the three nationwide consumer reporting companies at the same time, or you can order your report from each of the companies one at a time. The law allows you to order one free copy of your report from each of the nationwide consumer reporting companies every 12 months.

Thanks for the advice

Just ordered the credit reports

Any other advice is welcome

If you need help give me a call.. I only lend in Florida but i'd be happy to give you advice that could lead you to the right mortgage protessional.


you have 10k for the down payment.

how much do you have for closing costs?


I'm a mortgage guy in Mass. Sounds like you have 5% down roughly. The rates will not necessarily be that much better than going no money down, so you're looking at either an 80/20 no money down or an 80/15 with 5% down.

If you go with the 5% down you'll need to finance the closing costs. The easiest way is to tack it on to the price of the house. Let's say you agree to a price of $175k. You tell the seller you'll buy the house for $180k and he credits you $5k for closing costs and prepaid items. Or you make the offer such that the price you offer includes the credit for costs and prepaids. It is generally not a problem as the seller is ultimately getting there price. I've done pleanty of closing like that.

Fire away with any questions about financing. I can't lend in your area, but I can answer questions and make sure the deal you are getting is a good one.

Why are you buying a condo in Chicago? There is so much inventory coming on the market right now and in the next year.

"Why are you buying a condo in Chicago? There is so much inventory coming on the market right now and in the next year."

Sounds like a good time to buy to me.

I'm a realtor in Washington State. You should check out my website for info. It's about 97 percent complete and will hopefully be finished in the next couple days. It has a section for buyers with a good timeline laying out the buying process.

You really need no money to buy a home these days. You can tack the closing costs in the purchase price of the home and maybe that 10K will be better left in your pocket. You can contact me anytime as well if you have questions on the buying process. I can also refer you to a good lender as well.

Check out www.DiToProperties.com


Meaning the inventory levels have yet to peak, when they do in a year or so then you buy.

I used to be a real estate agent, currently an attorney and an investor in real property.

Feel free to email at jrj731@hotmail.com I can give you my number and we can chat live. I can walk you through the entire process step by step top to bottom (btw, just trying to help not selling any services).

You're in a good position in life you just need the right guidance.

^^ i second that. it's not going to kill you to wait

$10,000 is not going to make a difference for your financing, save that money for some of your closing costs and keep your loan amount as low as possible.

Usually the seller will pay for your closing costs (if you have a good RE agent that should not be a problem). As for PMI you can do 2 loans, one for 80% and one for %20 and you won't have to pay PMI.

Most likely, since you are young and you will likely sell that condo/apartment before the term of your loan (if you go the standard 30 years), you should not worry about long term cost, it would be irrelevant.

If you want to sell that apartment within say 7 years, keep your monthly payments low by using a ARM loan type.

In an up market and especially for investment that what I would do (I am a loan officer in WA State). A lot of people hate ARM products, but I believe that they have their place if you know how to use them properly.

Lastly, do not forget that you'll need some money for fixing up the house. Paint, some electrical work can quickly add up even if you are doing things yourself.

Good luck!


I would also wait like others have said. But wait actively, don't wait for the newspaper to tell you the market is right. If inventory is rising you sit and watch for a place that goes unsold for a long period. Then come in with a lower offer and try to make yourself a good deal.

My biggest mistake in buying my first house was paying full asking price in a seller's market. If I'd have waited 6-8 months I could be sitting pretty cash heavy and ready to jump fast on all the deals in the inventory glut in my area right now.

Sit tight, keep saving and wait for the right deal.

Good luck on timing the market of any investment. The market is in a state of fear but it won't last forever. If you can find the right situation (a seller that must sell even below current market rates), it might be a great time to buy. If you think people are looking at buying deals, just look at a few of the threads on this part of the forum.

2006 will be the first time in HISTORY (since tracking values in 1963) there was a devaluation of real estate nationally. Could it happen again in 2007? Maybe, but nothing in history supports that real estate devalues for long periods of time. It has occurred in other countries but not the US.

In the end, real estate has historically been a great investment. Unfortunately the high appreciation the last few years has got people away to understanding the long-term value of real estate (including managing debt) because people were playing short-term strategies to take advantage of a real estate market on the tear.

I'm a real estate agent in chi-town. Shoot me an e-mail if you still need any assistance.