Tag Archives: Construction Financing/Mortgages

How to Avoid Unwelcome Surprises When Buying a Chicago-Area Condominium or Townhome

     One issue that has cropped-up often throughout the time I’ve been a Mortgage Lender (and continues to do so routinely) surrounds the question …

     Is the property I’m purchasing really a Condominium … or is it a Townhome?
  

https://1609956119.secure-loancenter.com/FreeConsult.aspx

      Just last night, the question came up one more time.  My client, who had been told they were purchasing a Townhome, is in fact buying a Condominium.

     The Legal Description of the property proves it is a Condominium.  The tax Permanent Index Number (PIN) shows the property is a Condominium.  Note:  They signed their Sales Contract before they talked to me.

     As you can guess, my Borrower is not very happy … 

     Calls and emails flew back and forth all night between my Borrower and myself regarding this issue.  Question after question was raised.  

     But no amount of talk, frustration, or wishing things were different will change fact.  The Borrower has contracted to buy a Condominium … even if they thought differently.  Facts and legal documentation don’t lie.  (For additional info, please read my post:  How to Determine if You’re Viewing a Condominium or a Townhome)

      When the Developer platted the property they have contracted for, they legally platted the development as a Condominium Project.  Within a Condominium Project the land is “common land”.  The land on which the Condominium is built is NOT OWNED by the individual Condo owner.

     What distinguishes a Condominium from a Townhome is not building design.  

     Let me say that again …

     What distinguishes a Condominium from a Townhome is NOT the design of the building.  Rather, it is the ownership rights of the land found underneath the building.

     In a true Townhome, the land underneath the building is separately divided and owned by each individual Townhome Unit owner.  Pretty much the opposite of Condominium ownership.

     I strongly suggest:  Everyone considering the purchase of a Chicago-area Condominium or Townhome should personally take the time to:

  • Obtain and Read the Legal Description of the property they are thinking of buying 
  • Thoroughly investigate the type of ownership that will  be received via the purchase of the property they are considering 
  • Do so PRIOR to signing a Contract 

 http://www.genemundt.com     Why does it matter?  Condominium Associations can be, and usually are, more restrictive on rules and regulations as they pertain to use of the property.  Restrictive to the point that a property’s marketability and “lendability” can be affected.
     So it’s very important that you take the time to perform this research.  Get the facts you need to make an educated and informed choice regarding your property purchase.  You don’t want unwelcome surprises when you go to finance your Chicago-area purchase …

http://www.genemundt.com/ContactUs.aspx

      
     *  Hoping to Buy, Construct, or Refinance a Condominium, Townhome or Single-Family Home in Will County or elsewhere in the Chicago area?  Contact Me today!  I’ll put my 37 years of Mortgage experience and expertise hard to work on your behalf.
     I can be easily found at:

Direct:  815.524.2280
Cell or Text:  708.921.6331
eFax:  815.524.2281
Click HERE for your FREE Mortgage Consultation!
Ready to Apply for your Mortgage?
 Twitter Account of Gene Mundt, Mortgage Lender   LinkedIn Account of Gene Mundt, Mortgage Lender   Facebook Acct. of Gene Mundt, Mortgage Lender   Pinterest Acct. of Gene Mundt, Mortgage Lender   Digg Acct. of Gene Mundt, Mortgage Lender
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Gene Mundt, Mortgage Lender, a Lender with 36 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


    

Dreaming of Owning a Home? Potential Move-Up Homebuyer? Don’t Be Afraid!

     Two articles I read just this morning addressed the issue of potential home buyers’ fears of rejection as they pertain to mortgage financing.  Each article, also spoke about the many misconceptions the public has that contribute to their fears.

https://1609956119.secure-loancenter.com/FreeConsult.aspx     The statistics quoted in these articles (per a national consumer survey by loanDepot LLC) were somewhat distressing for me as a Mortgage Lender.  The most alarming were:

  •  Nearly half (46%) of prospective homebuyers have not pursued the financing they would need in order to buy a home due to fear they wouldn’t qualify for a mortgage
  • More than half (56%) of all buyers who don’t currently own a home, but want to, indicated they’re not pursuing homeownership because they fear they won’t qualify for a loan
  • Of those who want to buy a home but haven’t tried to because they think they won’t qualify, 53% think today’s qualification environment is tougher than last year.


    And finally …
 

  • Fewer than three-quarters of Americans who fear they won’t qualify admitted they haven’t actually taken any steps to find out for sure


     That last statistic is a particularly frustrating one, as it seems that collectively Mortgage Lenders, the real estate industry, and news media have done a good job of delivering the message (a needed educational one, admittedly) regarding the numbers of steps and larger amount of documentation required of today’s mortgage applicants.  

     But we may have done too good a job.  As the statistics show, potential homebuyers are now intimidated and fearful of the homebuying and mortgage process.  That’s not good … nor is it the reaction we seek. 

     If you are hoping and wanting to buy, you shouldn’t be scared of the process you need to follow to accomplish it.  And you certainly should never be scared of approaching or contacting me or your real estate professional.  You should not be afraid to ask questions or perform some fact-finding.  

     What you find out may surprise you! 
    

http://www.genemundt.com/MortgageChecklist.aspx

     Recently I wrote a post, What are the Requirements to Qualify for a Home Loan Today?”  It offered many of the basics for mortgages and mortgage applicants as they exist currently (post written 4/28/2014).

     The truth is:

  • Mortgage programs are available that accept Credit Scores (in some cases) as low as 580.
  • You do NOT have to put 20% Down on your home purchase
  • Mortgage Programs exist for 0% Down (VA and USDA-RD loans) or as little as 3.5% Down (FHA financing)
  • According to Ellie Mae:  Credit standards have loosened in comparisons to one year ago.  Approval rates for  applications are almost 3% higher than they were (58% in March of 2014
  • Exceptions DO exist for those that suffered “Extenuating Circumstances” (Foreclosures, Short Sales, Bankruptcy, etc.)
  • Sellers CAN assist with Closing Costs
  • A NO received on your Mortgage Applications doesn’t have to remain a NO indefinitely
  • Mortgage consultations are typically FREE.  Mine, for Chicago area clients, definitely are.

  
     Please, if you’re considering buying a home now or in the future … don’t assume you know an outcome or the answers to questions left un-asked.  Find out for sure if you can buy for the first time or if you can become a “move-up” buyer.   

     Dreaming of Owning a Home?  Potential Move-Up Homebuyer?  Don’t Be Afraid!  Contact me today.  Together we’ll discover what facts and reality exist for you … and then move forward accordingly.

http://www.genemundt.com/ContactUs.aspx


     *  Hoping to Buy, Construct, or Refinance a home in New Lenox, another Lincoln-Way Community, Will County, or elsewhere in the Chicago areaContact Me.  I’ll put my 36 years of mortgage experience and expertise hard to work on your behalf.
     I can be easily found at:

Direct:  815.524.2280
Cell or Text:  708.921.6331
eFax:  815.524.2281
 
Click HERE for your FREE Mortgage Consultation!
Ready to Apply for your Mortgage?
 Twitter Account of Gene Mundt, Mortgage Lender   LinkedIn Account of Gene Mundt, Mortgage Lender   Facebook Acct. of Gene Mundt, Mortgage Lender   Pinterest Acct. of Gene Mundt, Mortgage Lender   Digg Acct. of Gene Mundt, Mortgage Lender
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Gene Mundt, Mortgage Lender, a Lender with 36 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


    

Just Like Your Underwear: Credit Needs to be Freshened-Up, Scrubbed, Updated, Fluffed & Changed

Just Like Your Underwear: 
Credit Needs to be Freshened-Up, Scrubbed, 
Updated, Fluffed & Changed 
https://1609956119.secure-loancenter.com/FreeConsult.aspx

     Everything needs to be “freshened up” once in a while.  It need to be given a trim.  Updated.  Fluffed.  Scrubbed-up.  Changed or re-arranged.

     Credit is no different! 

 
     But stop and think about it.  When was the last time you took a good hard look at your credit situation, your credit cards, or Credit Report?  Over a year?  Two?  More?

     Truth is, what worked for you credit-wise in the past, may not be serving your overall financial good now …  

  •  Interest Rates on your credit cards may have risen 
  •  Promotional rates may have fallen off 
  •  Rewards that initially drew you to a specific card, may   have lapsed. 
  •  The credit card company may have updated or dropped the benefits you liked from your card 

     It happens all the time … 

     And your mortgage rate?  The one you might have thought you were doomed to forever because of housing values?  It may actually deserve a second-look.  

     Mortgage Interest Rates have remained low … lower for much longer than most experts thought they would.  And as of this writing, have actually fallen some recently.  Enough that Refinances have come back on the radar for a large number of Americans in many housing markets.

     The airwaves, social media, and news are full of stories that tell of new security breaches. Passwords to banking accounts and websites need to be changed one more time.  We hear of it so frequently, that it’s begun to take on the air of “common occurence”.  

     But it’s not …

https://1609956119.secure-loancenter.com/FreeConsult.aspx
     Your credit and Credit Report are always a “work in progress”.  If you haven’t checked your credit and Report out in the past 12 months, it’s time to now.  You can easily accomplish this on your own.  Just head to: 
 

and request your FREE Credit Report.

     If you want to find out what options exist for you to become a step-up home buyer, or to discover if Refinancing your present mortgage is an option … in the Chicago area, contact me.  Together we’ll run the numbers to find the opportunities that currently exist for you.  

     And if we find your credit and credit scores need improvement, we’ll “freshened them up”, give ’em a trim, fluff, scrub, change or re-arrange them so they’re the best they can be as you head into your financing and the future …

http://www.genemundt.com/ContactUs.aspx

      
     *  Hoping to Buy, Build, or Refinance a Home in the Chicago area?  Contact Me Today!  I’ll get you the facts, info, and figures you need to make the best home buying and mortgage financing decisions for you and your future.
I can be easily found at:

Direct:  815.524.2280
Cell or Text:  708.921.6331
eFax:  815.524.2281
 
Click HERE for your FREE Mortgage Consultation!
Ready to Apply for your Mortgage?
https://1609956119.secure-loancenter.com/WebApp/FullAppLogin.aspx
 Twitter Account of Gene Mundt, Mortgage Lender   LinkedIn Account of Gene Mundt, Mortgage Lender   Facebook Acct. of Gene Mundt, Mortgage Lender   Pinterest Acct. of Gene Mundt, Mortgage Lender   Digg Acct. of Gene Mundt, Mortgage Lender
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Gene Mundt, Mortgage Lender, a Lender with 36 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

Love Your New Construction … But Educate Yourself About Future Tax Bills

 Love Your New Construction … But Educate Yourself About Future Tax Bills

     *  I want to preface this article by saying it’s geography specific to the Chicago Area and its collar-counties …

     So you’ve opted for building or buying a newly constructed home.  You’ve decided you’re okay with investing most, or all, of your savings to cover the Down Payment and Closing Costs.  After all, it’s a new home, you hopefully won’t need money for repairs or improvements for quite a while. 
    

https://1609956119.secure-loancenter.com/FreeConsult.aspx

     Plus, the property taxes for your new home will initially be lower, as they’ll be based upon the vacant lot on which your new home is built.  (The new home wasn’t completed yet for the previous tax year’s bill.) 

     But how does this effect your future tax bill and the tax portion of your monthly mortgage escrow?

     When obtaining financing, during your first year of a new construction occupancy, the real estate tax portion of your escrow account is based upon the last available tax bill for that property.  Again, that tax bill, (referred to above), is based on the vacant lot, so your Mortgage Escrow Account, set-up at the time of your Closing, has been funded by low monthly payments … maybe as low as $50 to $100.  

     It must be pointed out:  I, as your Mortgage Lender, am required to base your tax escrow figures upon the MOST RECENT AVAILABLE tax bill.  I, like all Lenders, am prohibited from collecting anything beyond that.  

     The pros for homeowners that result from this are:  Their initial monthly mortgage payments are quite low.  But unfortunately, there are cons that come with this too.  

     What are those?  In the second year of occupancy, the County Tax Assessor having jurisdiction over the property, notes that the property (vacant lot) has been improved upon with a newly-constructed residence.  

     In Chicago and its Collar Counties, the following is an example of what the typical ramifications of this vacant lot/new construction tax escrow scenario are … and the timeframe in which they occur:

   1.  Closing occurs on:  August, 2012.  The Occupancy Permit is issued on that date.

   2.  Taxes for the previous year of 2011 (based on Vacant Land), now payable in 2012, were $100.00.
https://1609956119.secure-loancenter.com/FreeConsult.aspx 
   3.  The Builder paid the 2011 tax bill for $100 at the time of the Closing in August, 2012.

   4.  The Buyer/Borrower’s Mortgage Escrow (based on the 2011 tax bill) is figured and set-up at Closing.  The Mortgage Lender require they pay $50 per month into their escrow for Real Estate taxes, beginning with their first payment due in October, 2012.  

   5.  New tax bills are issued in May 2013, for the previous 2012 tax year.  They still don’t reflect the newly- constructed improved property, as the Assessor’s Records aren’t updated in time to reflect that improved property’s existence.

   6.  AFTER these tax bills are issued, the Tax Assessor updates the property record card noting the Occupancy Permit issuance and the date of Occupancy, August 2012.  The Tax Assessor then submits the new improved evaluation and assessment accordingly.
      
     Fast forward to May 2014 …  

   7.  New tax bills are once again issued, but now they reflect 16 months of improved property (the last 4 months of 2012 and the entire 12 months of 2013).  This new tax bill is issued at the current tax rate levied for the property’s Township.

   8.  As a result, the Homeowner’s/Borrower’s Escrow Account is short.  It doesn’t have enough money in it to pay the new tax bill reflecting the improved (newly constructed) property.  * Remember, the Escrow only has collected the low $50 per month amount allowed at the time of Closing.  But the new bill is “catching up” on the missed months of taxes based upon the improved property.  

   9.  The Mortgage Lender, based upon the new tax bill they have received, sends the Homeowner/Borrower a notice of an increase to their escrow payment … or they provide the Homeowner an option to cover their shortage in escrow with a lump sum payment.

     The result of this new construction tax scenario can be scary and burdensome for a homeowner.  If they haven’t prepared by setting aside an estimated amount for their new higher taxes, panic can set in.  All too often, I’ve seen the homeowner have to opt for the larger monthly escrow payments because of their ill-preparedness. 

     If you are considering the buying or building of new construction in Chicago or a Collar County:  Don’t be caught off guard regarding your new construction property taxes.  They will rise at some point.  Be fully prepared for that. 

     While you’re in your initial Mortgage Process and your Closing, listen to me, your Mortgage Lender.  Heed my advice regarding your escrow and future tax bills.  This issue is too important to not fully understand it, prepare for it, and act upon it …

http://www.genemundt.com/ContactUs.aspx

    
     *  For thorough, detailed new construction financing advice and assistance in the Chicago area, contact me today!  I’ll put my 36 years of mortgage experience hard to work on your behalf.  I can be easily found at:

Direct:  815.524.2280815.524.2280
Cell/Text:  708.921.6331708.921.6331
eFax:  815.524.2281815.524.2281
Click HERE for your FREE Mortgage Consultation!
Ready to Apply for your Mortgage?
https://1609956119.secure-loancenter.com/WebApp/FullAppLogin.aspx
 
 Twitter Account of Gene Mundt, Mortgage Lender   LinkedIn Account of Gene Mundt, Mortgage Lender   Facebook Acct. of Gene Mundt, Mortgage Lender   Pinterest Acct. of Gene Mundt, Mortgage Lender   Digg Acct. of Gene Mundt, Mortgage Lender
 Trulia Acct. of Gene Mundt, Mortgage Lender   Zillow Acct. of Gene Mundt, Mortgage Lender   Lender411 Acct. of Gene Mundt, Mortgage Lender    Klout Acct. of Gene Mundt, Mortgage Lender    Gene's Chicagoland Blog/Gene Mundt, Mortgage Lender 
Gene Mundt, Mortgage Lender, a Lender with 36 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
 

 

Looking to Buy a Condominium? What You Need to Know

Image

Looking to Buy a Condominium?  
What You Need to Know
     If you’re presently in a house hunt, or even just dabbling with the idea of buying a home, you’ve probably done some research and run across multiple articles regarding the current Mortgage Process … and its challenges … 

     You’ve probably also heard that you’ll be asked to submit plenty of documentation regarding your finances (savings, credit/debt), employment, down payment ability, and more to meet lending requirements.  And that the home your hoping to buy will need to pass muster (via an Appraisal) with your Lender as well.       All that is true.  And if the property you’re hoping to buy is a Condominium, the level of scrutiny and amount of documentation required grows even more.   

     Why is that?   

     There are many outside influences that are woven into a Condominium transaction and its financing. Because of that, there are a few extra steps that must be taken by Buyer(s), Seller(s), and professionals involved with these transactions.  

     It’s important to establish if the property being transacted is legally determined a Condominium.  That determination is arrived at in a number of ways.  

     The first entails examination of the property’s PIN or Permanent Index Number A PIN is a numerical “code” for the legal description of a piece of land as it has been defined for the purposes of real estate taxation. The code points to the parcel’s location on tax maps.  PINs for Condominium units OFTEN, but not always, appear differently from other properties, as they are identified by an additional suffix, or set of numbers; other than 0000 at the end.  

     The second method  involves the Legal Description for the property.  If the word “Unit” is used within the Legal Description, the property is most likely a Condominium.  If the Legal Description mentions “PUD” (Planned Unit Development) within it, the property is typically a Townhome.  

     The Association aligned with the Condominium Project will need to supply information and documentation for the Mortgage Lender.  A complete copy of the recorded Condominium Declarations and Bylawsalong with any amendments  … must be suhttps://1609956119.secure-loancenter.com/FreeConsult.aspxbmitted to the Lender for their viewing.  The Association’s most recent budget must be submitted too.
    
  A fully-completed Condominium Questionnaire will be required.  What information does your Mortgage Lender look for on this Condominium Questionnaire? 

  • The number of 30-Day delinquencies within the Association (Ratio to total number of Units)
  • The number of Owner-occupied VS Investor-owned Units
  • Pending Special Assessments
  • Possible litigation, mediation, arbitration, or disputes involving the HOA (Present & Pending)
  • What, if any, Reserve Funds exist
  • If common elements and/or facilities are complete 
  • If the Project plans additional phases or add-ons
  • If the Condominium Project maintains adequate Insurance Coverage

      Selling/Listing Agents can assist in the smooth transacting of  Condominium properties by providing the following:

  • Tax Bill for the Property
  • Declarations/ByLaws for the Condo Association
  • Survey (if it exists – There will be one for Townhomes)
  • The Name and Contact for the Association
  • A copy of the Title Policy/other document with a full Legal Description within it

     It’s important for Mortgage Lenders to perform this close scrutiny of properties, as not all Condominiums (or the Projects they lie within) are eligible for all types of financing.  Borrowers must remember it’s ultimately for their protection that these questions are asked and documentation is requested.

     Looking to Buy a Condominium?  What You Need to Know  …  There are some extra steps that must be considered and taken when purchasing a Condominium property.  Your interests will be best served by working with experienced Mortgage and Real Estate professionals from start to finish.

     In the Chicago area, contact me with your Condo questions and for assistance with your Condominium financing.  I’ll be happy to put my 36 years of extensive Mortgage expertise and experience hard to work on your behalf.   
     I can be easily found at:

Direct:  815.524.2280
Cell or Text:  708.921.6331
eFax:  815.524.2281
Click HERE for your FREE Mortgage Consultation!
Ready to Apply for your Mortgage?
https://1609956119.secure-loancenter.com/WebApp/FullAppLogin.aspx
 
 Twitter Account of Gene Mundt, Mortgage Lender   LinkedIn Account of Gene Mundt, Mortgage Lender   Facebook Acct. of Gene Mundt, Mortgage Lender   Pinterest Acct. of Gene Mundt, Mortgage Lender   Digg Acct. of Gene Mundt, Mortgage Lender
 Trulia Acct. of Gene Mundt, Mortgage Lender   Zillow Acct. of Gene Mundt, Mortgage Lender   Lender411 Acct. of Gene Mundt, Mortgage Lender    Klout Acct. of Gene Mundt, Mortgage Lender    Gene's Chicagoland Blog/Gene Mundt, Mortgage Lender 
Gene Mundt, Mortgage Lender, a Lender with 36 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
 

     

10 Tips for Constructing a New Home in New Lenox and Chicagoland

     No doubt about it.  The winter we’ve had in Chicagoland this year has been a long and challenging one.  Mother Nature dumped one more round of snow on us yesterday.     Yet, truth is, Spring isn’t that far off.  It will definitely be very welcomed this year … 

http://www.genemundt.com     Last year, and even into this winter, we did find more new construction popping up in the Chicagoland area.  In Will County, a handful of towns saw applications for new housing permits numbering over 100+.  The Village of New Lenox, a  Lincoln-Way Community, was one of them.  Great news for the area.

     The Village of New Lenox has issued 180 new construction permits for this year so far.  (The Village’s fiscal year ends April 30th).  Newer changes made in the fee structure paid by Builders and Developers are paying off for the Village and are being given credit for the steady rise in permit applications.  

     So if you’re a hopeful new construction Buyer … or dreaming of building your own home somewhere in the New Lenox area … what’s the first step you should take?

     As with any home buying experience, the first thing you should do is talk to a Mortgage Lender to be Pre-Qualified for Mortgage financing.  By doing this very important first step, you discover exactly how much home you can afford to buy or build.  (For more info regarding Chicagoland new construction Mortgage financing, click HERE.
http://www.genemundt.com/ContactUs.aspx

          After your Mortgage financing has been put in place, you should consider and follow these 10 new construction tips below:

     1.  Contact and work with an Agent from the area in which you hope to build and live.  
 
         Yes, you read that right.  An experienced local agent can provide you with a myriad of important info ranging from school systems, to a list of area builders.  They’ll help you compare Builders’ completion statistics and reputation.  They’ll also have info for you on differing area subdivisions,  price, taxes, and much more. 

    2. Thoroughly research the reputation of the Builders provided by your Agent.  Get references and testimonies from their previous customers.  Check with the municipalities in which the Builders have previously built for any financial or construction issues that might have occurred.   

    3.  Consider the potential Re-Sale value of the home you are building.  You never know what the future holds in store.  Plan ahead for possible life changes.

    4.  Once you have narrowed your choice of location to a neighborhood/subdivision, talk to the governing municipalities in which it is located.  See what those  municipalities have in store for that area in the future.  Zoning, parks, schools, taxes, roads, additional future construction in the area, and much more can play a distinct part in the future re-sale of your home/property.  Be educated about the building process and do your homework. 

    5.  Keep a timeline for construction in mind.  Expect and plan for some delays.  Weather and a host of other issues can cause construction to fall behind.  Allowing for delays will lower your overall new construction costs and stress level.

    6.  Prior to signing a Contract to construct:  Work out ALL details.  Making changes or additions to work after a contract is signed can be extremely costly.  It also slows down construction and can push your completion date back.  

    7.  Be consistently involved in the progress of your new construction.  Talk to your Builder.  Ask questions.  Do “drive-bys” to see how things are moving along.

    8.  Include a Home Inspection in your Contract.  New construction does not insure perfection.  Have an independent inspection performed by a licensed Home Inspector. 

    9.  Scrutinize and keep to your construction budget.  Remember you’ve been approved for your financing (and a monthly payment) already.  Don’t get emotionally carried away and overspend on extras.

  10.  Consider options for temporary housing, should it be needed.

     New Lenox offers great opportunities to buy or build new construction, as do many other cities and counties in the Chicagoland area.  A menu of financing opportunities are available to those considering buying or constructing a new home today.  

    10 Tips for Constructing a New Home in New Lenox and Chicagoland.  To start your exciting journey to becoming a new construction home owner in New Lenox, another Lincoln-Way Community, Will County, or elsewhere in Chicagoland, contact me.  I’ll get to work immediately to help you discover what financing options exist for you. 

http://www.genemundt.com/ContactUs.aspx

      
     

Gene Mundt, Mortgage Lender
Direct:  815.524.2280815.524.2280
Cell or Text:  708.921.6331708.921.6331
eFax:  815.524.2281815.524.2281
Click HERE for a FREE Mortgage Consultation!
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Gene Mundt, Mortgage Lender, a Lender with 36 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

Construction Terms & Definitions You Need to Know While Building a Home in Will County & Chicagoland

Construction Terms & Definitions You Need to Know While Building a Home in Will County & Chicagoland    

     A short while ago, I wrote a post addressing new home construction in the Chicagoland and Will County area.  It set-off a firestorm of calls from people … each interested in pursuing their dream of building their own home soon.      Within my post I provided a “blueprint” of sorts for the pursuit of New Construction Mortgage financing and what is vitally important should you hope to find success in securing a Construction Loan.  

     When you read my post, you see that Construction financing is a process … one that takes place in an ongoing fashion throughout the planning, building, and ultimately … at the completion of your home.  Given that fact, it’s wise to be fully-educated and familiar with the terms you’ll be hearing through the financing and building processes.  

     As we head into a New Year, it’s the perfect time to kick-start your education and to get your new Construction questions answered.  For financing info, contact me.  To help with the terms you’ll hear during the actual planning and construction of your home, I went in search of glossaries and dictionaries for new Construction.  And I found some very good resources to pass on to you … 

     I’ll start with my most obvious resource for financial and Mortgage terms, my own website’s Glossary, found HERE.  When you have questions concerning anything you’re seeing, hearing, or just don’t understand, contact me.  We’ll discuss your questions and concerns so you’re more comfortable moving forward in the process.
          
     For new Construction terminology, I found a handy glossary provided by Home Building Manual at:  www.HomeBuildingManual.com.  From A to Z, this glossary provides 100’s of words and their definitions you’ll hear and need while you, your General Contractor, and sub-contractors are planning and building your home.

    Another great source of info was BuilderSpace.com‘s,  Construction Dictionary and Glossary of Construction Terms.  It covered everything from general terminology used during a new construction project to Concrete, Doors and Windows, Electrical, Masonry, and more

     For those hoping to build a “green” home, I offer an

https://1609956119.secure-loancenter.com/FreeConsult.aspx

article that explains just what actually defines or makes a home or product “green”.  Very timely in our Will County and Chicagoland area as I write this post, as the snow is thick on the ground and the temperatures are frigid … and we just were through a very warm summer this past year.  That valuable info/resource can be found on the Green Builder Magazine website: HERE.

     As written in my prior post, the good news is that a menu of options exists for you to choose from … during the search for a lot and a building plan … and new Construction financing.  To secure the most advantageous options for every step of the new construction process, it’s best to be fully educated and familiar with all you’ll hear and be expected to make decisions on.  I hope the resources I provide above assist you in achieving that important goal.

     
     To ask and receive the answers you need prior to building a new home in the Lincoln-Way Area, Will County, or elsewhere in Chicagoland, receive the info on new Construction financing you’ll need, or referrals to real estate professionals in the area, contact me.  I’ll be happy to hear from you and assist you with all your Mortgage questions and needs.  
      I can be easily found at any of the following:

Direct:   815.524.2280 
Cell or Text:   708.921.6331 
eFax:   815.524.2281 
Click HERE for a FREE Mortgage Consultation!
Ready to Apply for your Mortgage?
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Gene Mundt, Mortgage Lender, a Lender with 36 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.  

Gene Mundt, Mortgage Lender can be contacted at:  

 815.524.2280   or   708.921.6331  
or via his email:  gmundt@goapmc.com.

Contact Gene Mundt, Mortgage Lender soon!

 

New Home Construction Financing in the Chicagoland Area

New Home Construction Financing in the Chicagoland Area

     My wife and I were out running errands yesterday.  It was an absolutely gorgeous Fall day in Chicagoland.  We weren’t alone in our effort to get out and enjoy the beautiful weather either.  The roads were busy and filled with cars. 
      
     As we drove along, we both noted the healthy spattering of new construction popping up all over.  Once a very familiar sight, new home construction in our area had come to a screeching halt during the housing crisis.

     The area in which we live, Will County, IL … as well as the entire Chicagoland area … had exploded with new construction during the housing boom.  According to the 2010 Census, Will County, IL saw a growth in population of almost 35% over that reported in the 2000 Census.  (That 2000 Census had reported an increase of almost 41% over the previous census.)  So it’s no wonder that Will County was named the 2nd fastest growing county in the State of Illinois during that time.

     The sight of newly-framed homes, new developments, and a rising number of contractor’s trucks on the highways in Chicagoland is very welcomed, as it’s a sign of improving economic and housing market health.  This new construction activity brings other good things along with it too, as its brought a flurry of calls and questions regarding new construction financing.  Love it …

     As with many things in the quickly-changing real estate industry though, the new and current construction financing doesn’t completely resemble the old.  Here’s some of the changes to be found …

     Years ago, vacant lots were often times owned or purchased by the homeowner.  In this scenario, when the Individual (not a Builder or Contractor) owns a lot and chooses to build a new home on it, the typical financing route is a “6-month construction loan”, secured by the Individual Lot Owner (Borrower) at a Bank or Mortgage Company. 

     During the construction process, the Individual/Lot Owner requests that 4 or 5 “payouts” be made.  These “payouts”  are funds from the loan that pay the Sub-Contractors for their completed work (supported by signed and notarized Contractor’s Waivers).   Payouts are usually preceded by inspections (performed by the Bank or Mortgage Company’s Appraiser) verifying the payout of funds requested appropriately reflects the actual work completed.

     The stages at which these “payouts” are considered, usually include completion of:

  • Excavating and Foundation
  • Rough Framing/Construction of the Residence/Garage
  • Rough Mechanicals – Plumbing, Electrical, Heating and Air Conditioning are “Stubbed” in
  • Insulating, Drywall, Millwork (Trim, Doors, Windows)
  • Final Inspection – (100% Complete – Final Occupancy Permit)

     After completion of construction, the Homeowner seeks a permanent, or “end loan” to pay off the Construction Loan.  (Construction Loans are typically a short term, interest only type of loan … not intended to be for a Fixed Term, such as 15, 20, or 30 years.)  The Individual/Borrower’s permanent Mortgage is then based upon a “completed” value, as determined by the Mortgage Lender’s Appraisal. 

     This value estimate is typically in line with the Cost or Value of the lot, PLUS the Construction Costs (Labor and Materials).  The new loan is then considered a Refinance … and Loan-To-Value considerations are based upon the new Appraised Value.


     However … in today’s environment, MOST of the building sites in Will County, and elsewhere in the Chicagoland area, are created and owned by Developers/Builders, who market/sell their products from Model Homes.  Prospective Home Buyers contract for varying features and amenities offered in addition to the basic model chosen and semi-customize their new home according to their tastes and preferences.

     In this scenario, the Builder funds his own construction process (usually with their own banking relationships, or cash), and when the home is completed … sells the home outright to the new Homeowner.  The Homeowner/Buyer secures traditional Mortgage financing, according to the agreed-upon Sales Price, and closes after the Final Occupancy Permit is issued and the home is complete.

     So what are your current financing options if you own your own lot in Will County or Chicagoland and wish to hire your own Contractor to construct a new home on that lot? 

     I have good news!  Another loan option exists and is  available to you in this building/financing scenario.  This loan option performs as a combination of the two forms of financing related above.  It’s known as a  “Construction to Perm”  loan.  

     A “Construction to Perm” loan provides the money needed during the construction period and then converts to a permanent (End Loan) after construction is completed.  I’ll be offering more information regarding this loan option (“Construction to Perm”) in greater detail in an upcoming blog.  Should you have questions or have a more immediate need for information or assistance, contact me at your convenience at any of the options found below …

    
  
     *  Hoping to Buy or Build a Home in Will County or elsewhere in the Chicagoland region?  Contact Me!  I’ll put my 36 years of mortgage experience, knowledge, and expertise hard to work on your behalf.
     I can be easily found at:

Direct:  815.524.2280
Cell/Text:  708.921.6331
eFax:  815.524.2281
Click HERE for a FREE Mortgage Consultation!
Ready to Apply for your Mortgage?

When Should a Will County – Chicagoland Home Buyer First Seek Financing Guidance?

When Should a Will County – Chicagoland Home Buyer First Seek Financing Guidance?  
     As a Mortgage Lender, I recommend that potential Home Buyers contact me up to one year in advance of their purchase.  That is especially true when that Home Buyer is a First-Time Home Buyer.  And here’s why …
     I recently had a young newly-engaged couple contact me for Mortgage financing.  They were hopeful First-Time Home Buyers wanting to learn how well they were currently positioned to buy a home.  They also wanted to know more about their Mortgage financing options and what was ahead of them during the Mortgage Process itself.
     This young couple was well-organized.  I’d recommended that they visit my website prior to our meeting and they had done so.  They had a good portion of their needed financial documentation in-hand and were prepared and ready to talk.
     But when this young couple sat down, I just knew they were scared to death.  It isn’t unusual to see this reaction.  Most First-time Home Buyers have little idea of what they’ll face, so it’s only natural that they’re a bit apprehensive.
     Many clients have probably heard that there will be an onslaught of questions to answer.  But they rarely know what those questions will be … or how answering those questions will end-up fulfilling a need within a transaction.
     After working with this young couple, I thought seeing some of the questions they were asked during their first Mortgage Consultation might prove helpful to others in their preparation to buy/finance a home.  Keep in mind, every Buyer’s needs and financing scenarios are different and can vary greatly.  But many of the questions you hear may be similar or close to those found below. 
     You will most likely be asked:
  •  How soon are you hoping to buy?
  •  Do you know your Credit Scores?
  •  Have YOU pulled your Credit Report from www.freeannualcreditreport.com(Depending on your personal situation, I may/may not request to run your Credit Report at this time).
  •  Have you saved any monies for a Down Payment?
  •  If so, how much have you saved for your Down Payment?
  •  Do you want to “keep back” or retain any of your savings after Closing?

     Other questions will include:

  •  Have you started an actual home search?
  •  Do you know the location and price range of home you wish to buy?
  •  Do you know what price a home with those features … and in that location … will demand?
  •  What debt do you currently have?  
  •  Do you have installment Loans, such as Auto Loans, Student Loans, Credit Cards?
  •  How many accounts (called trade lines) have you established?
  •  What about your Employment(s)?
  •  How are you paid?
  •  What are you paid?
  •  How long have you been on the job?
  •  Does that include overtime?  Will that overtime continue?
  •  Does your pay include bonuses? Will those bonuses continue to come … or are they unscheduled?
  •  Are their children involved?  Child Support? Alimony?

     Knowing this couple was an engaged couple, with a wedding day set, I also asked the following questions:

  •  Will your wedding and wedding expenses impact your credit/debt?
  •  If so, how much?
  •  Upon marrying, will monetary wedding gifts impact your Down Payment?
  •  How do you intend to use the gift monies?
  •  Have you set-up a separate banking/checking account for wedding/reception funds?  One that separates those monies from the Down Payment funds/account?

     
     As you can see, there is much to consider as you enter into Home Buying.  This is especially true if you are a First-Time Home Buyer or someone getting married during the Process.  The questions above also prove just how personalized today’s Mortgage Process has become … and just why I recommend starting the Mortgage Process so far in advance.  

     In my next post, I will address:

  • HOW and WHY having an early Mortgage Consultation can benefit you
  • WHY providing required documentation in a timely manner is important
  •  WHAT guidance and assistance you can expect as we move forward in the Mortgage Process together

     

     As always, you are invited to contact me with any questions or needs at your convenience.  You can easily find me at the following:
                                                                                                Gene Mundt
Direct:  815.524.2280
Cell/Text:  708.921.6331
eFax:  815.524.2281
Click HERE for your FREE Mortgage Consultation!
Ready to Apply for your Mortgage?