Living in Lincoln Park Blog

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February 10th, 2009

Buyer Advice…lending guidelines have changed

We’ve all read the articles about how bad the national real estate market is. And we have had conversations about Chicago real estate and this being a great time to buy. While I see both sides, I lean towards the “great time to buy side.” And though there are some great deals to be had, the wild card now seems to be the lenders. In the past, buyers were able to tell the lenders what they were willing to put down – 5%, 10%, even 0% + throw in the closing costs and go for a 103% loan! Or to make it even more interesting, “let’s do an interest only loan.”

Oh how the times have changed! Now the loan criteria seems to be a moving target. As I have been telling my buyers looking for Chicago real estate over the past few months, we are no longer in a market where you can say “here’s the loan I want,” or “here’s what I’m willing to put as a down payment.” The ability to get a loan is now pretty much dictated by the lender…they will tell you how much of a down payment you will have to come up with in order to get a loan.

So before you go out and find the home of your dreams, make sure that you can get a loan. Mortgage calculators will give you a sense of what you can afford, but it is up to the lenders to make it happen.

February 9th, 2009

Finally some good economic news!

We are constantly being bombarded with bad economic news. Well, finally there seems to be some good news on the horizon! James Smith, chief economist at Parsec Financial is quoted in the Chicago Tribune as saying growth will resume “no later than May 15.” Smith has strong opinions about how economies react to a panic, which in the current case is “about over,” he said. “After every one of these episodes, the economies affected usually come back stronger than before and more rapidly than we expect. The deeper they fall, the quicker the rebound.” He believes that housing will rebound first, then vehicle sales, consumer confidence and small-business optimism.

So if you agree and feel that we may be ready for the economic recovery,  it’s time to start searching Chicago homes for sale so you’ll be ready to take advantage of the market before the rebound is in full swing!

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