Types of Home Loans in Illinois

What Type of Illinois Mortgage Loan is Best for Me?

Illinois Mortgage Loan

It is an important question to anyone who owns a home in Illinois to understand if they can afford an Illinois Mortgage loan. There are questions such as, what kind of downpayment will I have, and what the heck are mortgage points?  What will closing costs be on my Illinois mortgage loan?  How much will the title fees be on my Illinois mortgage loan?

What Illinois Mortgage loan can I afford?

Most lenders concur that your ideal mortgage should lie no more than above 28% of your overall income before taxes. This makes your mortgage very affordable and safe, and also includes interest, prinicipal repayments, and other monthly expenses like taxes on your real estate and home owners insurance.

Example of debt to income calculation on your Illinois mortgage loan

To give an accurate example, if your annual gross income is $32,000, you should not accept anything more than roughly $800 monthly with your Illinois Mortgage loan. Or if you earn $50,000, those payments adjust to around $1,033 a month.

Should I consider an adjustable rate mortgage?

It’s a very valid possibility to take out a mortgage with a adjustable rate, that adjusts as your level of income changes over the years. With an adjustable rate mortgage you can more easily purchase better properties. You must pay a flat amount for these types of mortgages upfront, usually.

What are mortgage points?

If you happen to have spare money when you draw up the contract or your mortgage, it’s quite possibly to get a sizable reduction in your interest rate by the practice of purchasing mortgage points. To make it simple, one point is 1% of the loan. If you borrow $50k to purchase your new home, one point will be $500.  Mortgage Points are fantastic for reducing your mortgage rates. If you utilized the same $500 you spent on one mortgage point as an additional down payment, you would only save roughly $20 a year at a 4% mortgage rate. So thus once you have paid the down payment, any extra money you may have available would likely be best spent buying mortgage points, in lieu of adding more money to your original deposit.

Paying off your debt

Many people wonder how can I possibly afford an Illinois mortgage loan when I have all these credit cards to pay off. Really this question can only be answered by you, or someone with your direct financial information. If you have any spare money available month to month after paying your mortgage, it is quite advisable to make payments on your current debt.

Cash Out Refinance Mortgage to Consolidate high interest rate debts

Mortgage loans are often much more affordable than credit cards, which charge up to 4 times more than a conventional mortgage loan. So this effectively means that if you use a mortgage loan over credit cards, you can borrow up to four times the amount of money!

There are many other things to consider when lending, but these two things should be a great help to your decision in purchasing a Illinois mortgage loan.  I am a mortgage banker and correspondent lender with no mortgage lender overlays and can help you qualify for a mortgage loan in Illinois as well as other states.  Please contact me at gcho@gustancho.com or call me at 262-716-8151.

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The information contained on Gustan Cho Associates website is for informational purposes only and is not an advertisement for products offered by The Gustan Cho Team @ Gustan Cho Associates or its affiliates. The views and opinions expressed herein are those of the author and/or guest writers of Gustan Cho Associates Mortgage & Real Estate Information Resource Center website and do not reflect the policy of Gustan Cho Associates Lenders Network, its officers, subsidiaries, parent, or affiliates.

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