What Missteps to Avoid When Wanting To Get Approved for a Mortgage   Buying a home is an exciting experience, but there are some important things to remember when applying for your mortgage. To make sure the process goes as smoothly as possible, it’s important to avoid doing certain activities that could disqualify you from getting approved or result in a higher interest rate. This blog post discusses seven common mistakes people make after applying for a mortgage and how they can be avoided. 1. Sourcing large sums of cash Before making large cash deposits into your account, you'll need to check in with your loan officer and discuss the best way to document the transaction. This is because lenders need to source the money they are loaning; however, since cash isn't easily traceable, it's vital to document all transactions accurately. By discussing this with your loan officer in advance, you can ensure that all lending regulations are met and provide a smoother process. 2. Making any large purchases It can be tempting to buy an expensive new appliance or furniture set when you’re preparing to move into a new home. But when applying for a mortgage, it’s critical to avoid making any large purchases—not just home-related ones. Lenders look at your debt-to-income ratio when assessing loan eligibility; anything that increases your debt could disqualify you from a loan. Keeping purchases to the strict essentials while awaiting loan approval is one way to ensure success in obtaining the mortgage even if it feels like a necessary purchase, wait until after you’ve gotten approved for the loan before diving into larger purchases. 3. Cosigning loans for anyone When considering cosigning a loan, they should be aware that it’s not just a matter of signing the paperwork and being done with it. The contract carries a significant responsibility to ensure that the lender receives what was promised. Getting approved for financing could depend on careful analysis of the debt already committed to, including cosigned loans. Although a cosigner may not be actively making payments for the loan, their obligation remains—and should be considered when considering further financial commitments. 4. Switching bank accounts When you are trying to purchase something major, lenders need to be sure they can trust your ability to pay back a loan in full. To do this, they have to source and track all of your assets – and the task can be quite complicated if your accounts are inconsistent. That's why it is important to speak with your loan officer before transferring money. This way, you can ensure that your lender has a clear understanding and record of where every dollar is being allocated, giving you the best chance at obtaining the loan you need. 5. Applying for new credit Credit scores are an important factor to consider when making any financial decision. From purchasing a car to obtaining a new credit card, having your credit report run by organizations across multiple channels can seriously impact your FICO® score. Lower credit scores will not only determine the interest rate you are offered but could potentially impact your eligibility for approval. These factors make understanding your financial health critical in helping you make informed decisions regarding borrowing and ultimately achieving long-term economic stability. 6. Closing any accounts Although many buyers incorrectly believe that decreasing available credit makes them less risky and more likely to be approved, the opposite is true. Your payment history is just one part of what determines your credit score. Two other key components are the length and depth of your credit history and the total amount of credit in use compared to available credit. Usually, when someone closes a credit account, it has a negative effect on both of those factors, resulting in an overall lower score. Therefore, reducing your available credit can make you appear riskier to lenders and lower the possibility of being approved. 7. Not discussing changes with the lender Please be sure to stay open with your lender when pursuing a home loan. Any income, assets, or credit changes should be openly discussed before making decisions regarding the loan application. It’s also important to keep your lender updated on any recent changes in your employment status that could affect your eligibility and ability to repay the loan. These conversations are often difficult, but they'll help lockdown the best rate available and provide security and peace of mind when signing those all-important documents. Being fully transparent is always better than hiding information - it can save time, money, and stress down the line if unexpected issues arise. To sum up, the process of obtaining a loan can be complicated and stressful. To ensure your best chance at success, following the above seven tips will be beneficial to getting the most favorable terms for getting a mortgage. If you would like assistance navigating the world of the home-buying process in the Chicagoland area, Deborah Benn with Real Estate Hub Spot is ready to assist you.

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    Looking for a new home is tough, but we can find your perfect match with the right resources! Hello, my name is Deborah Benn, one of the partners at RealEstateHubSpot.com, and I'll be your tour guide on the steps when buying a new home. Yay, it's time to start hunting for your home and go shopping to find it. Our team's website, RealEstateHubSpot.com, is an up-to-date website to search for Chicagoland homes online; you can't get more up-to-date than ours with the timeliness of new listings hitting the market. Based on your needs, we will create searches, where you will receive new listings in your email… And you will have access to search the properties for sale yourself.   Knowing you will only see the properties available for sale is important. Did you know that other websites include property listings under contract with another buyer that is unavailable for you to buy? You're probably thinking, yeah, what's the big deal? These websites are trying to get your contact information to solicit their services. The more homes on their website, whether available or not, provides the higher probability that a consumer will register with their contact information. This causes much confusion to consumers, which is why we avoid it on our website. One of the common frustrations is when buyers use these third-party websites, get excited about a home, ask their Realtor about it, and find out it's under contract with another buyer. It's frustrating and a waste of time. It is also good to know that when using other popular third-party websites, you never know the type of agent you'll be communicating with. Just like in every industry, there's a spectrum with the quality of agents; some "faking it till they make it," some that sell a lot of real estate where they treat their clients like a "number," you know put their needs before the clients, and the list goes on. On RealEstateHubSpot.com, with our exceptionally high standards for our clients and team, you'll be comfortable knowing precisely who you are communicating with.   Let me share one story, one that you'll appreciate. Recently, we worked with buyers who had minimal availability for showings. At that time in the market, buyers needed to view the home rather quickly, as the houses were flying off the shelves. To service these clients' unique needs, we had to tap into the variety of real estate brokers with RealEstateHubSpot.com to show them homes they were interested in. These buyers greatly appreciated that each partner, individuals they had never met before, truly cared about finding the right house; all willing to crawl through "crawl spaces" to help them dissect the property and speak about the pros & cons of it. They expressed they never felt rushed and appreciated that they never thought we were leading them in a direction just to get them under contract. It's incredible to work with colleagues that love each other clients like it's their family. We have story after story on how our clients feel comfortable with our high standards when it comes to our clients.  Once you find homes that pique your curiosity, our team will schedule showings to view them.   We have some tips for showings that are good to know. For showings, it's important to know that sellers permit us to view their property during a window of time. Entering their home outside that window of time is trespassing. Because of this, it's important to be timely for the showings so that we can take your time to view every aspect of the property. If we're going on a tour where we're scheduled to see multiple homes, it's even more important to be on time. Also, wear shoes that can be easily removed, remember to wear socks, or use the shoe covers provided during showings. We’re honored and excited to be working with you!  Now, let’s find you a new home.

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  What are the experts saying about home prices?  It seems like someone is talking about the possible housing market crash everywhere you turn.  Will home prices go up or down?  When will it happen?  Is now a good time to buy or sell?  These are all valid questions - but luckily, we have the experts to help us make sense of it all.  So what are the experts saying about home prices?  So let's take a look at this quote from Redfin.  It says, "For those bearish folks eagerly awaiting the home price crash, you'll have to keep waiting.  As much as demand is pulling back, supply is as well.  And that's reducing downward pressure on prices in the short run." So what does this mean?  This means houses are staying on the market longer.  We're not seeing an influx of new listings.  It is still a seller's market.  And what we know is that prices are driven by supply and demand.  And this is continuing to put upward pressure on home prices.  I know a lot of us are visual people.  So, let's look at this graph for the Chicagoland area, which shows the Median Sales Price Appreciation, the rate of appreciation for the past four years.  You'll see that Chicagoland is still experiencing appreciation, but the rate of appreciation is slowing down. Like markets across the nation, the Chicagoland real estate market is experiencing a historically low inventory of homes for sale.  We haven't seen inventory levels this low since 2013. News Listings represent supply, and the Contracts Written represent demand.  As in the previously discussed quote, supply and demand are pulling back, reducing the downward pressure on sales prices.   Let's discuss what experts say about the following year's home price forecast.  So we like to look across the board at several different experts and average them all out so you can see the whole picture here.  You can see here that some experts are projecting a little bit of appreciation next year.  That's what you see in those blue bars, anywhere from 0.7% to 2.6% appreciation.   We have other experts that are projecting slight depreciation.  So it's across the board; a little bit up, a little bit down, depending on how experts view it. When we average these across the year, there is roughly neutral, flat home price appreciation for 2023.  But it's certainly something we'll keep our eyes on as we go forward. Now, I would like to share another perspective on this with you.  Because big banks are projecting more depreciation in 2023, Goldman Sachs, Wells Fargo, Moody's, and Morgan Stanley, you can see that they're shifting more towards, You know what?  We may see some slight depreciation next year.  And it's a little bit different because some big banks follow more publicly traded builders versus some organizations that follow more existing homes. And so big banks are calling for more depreciation based on that new build type of environment, versus existing home organizations saying slight appreciation.  But what's most important and where they all tend to agree, and this is data from Wells Fargo that positions this well, is that 2023 may be a little bit of depreciation. So it could be rocky next year. But as we come into 2024 and beyond, we're turning to more normal home price appreciation levels.  And as we continue to look forward, as we look at things like the Home Price Expectations Survey saying more normal appreciation in the years ahead, it all depends on supply and demand.  And inventory is still historically low. So we will continue to see that in the years ahead. But 2023, a little bit of depreciation, a little more neutral. So that's the bottom line that we see here.  And this quote from Freddie Mac says that well.  It says, "While there may be a little statistical difference between a small positive number and a small negative number – talking about some appreciation, some depreciation – there are often huge differences in how they impact behavior." What we also know, especially as we look back on time, is that we had a great financial crisis.  There were five years of continued depreciation.  No one is calling for that long extended period of depreciation right now. So it will be a little rocky next year, potentially returning to more normal levels of appreciation.  So we're talking about something other than this prolonged financial crisis ahead of us.  We're talking about some up and some down next year and then back to more normal levels as we look nationally at that perspective, moving into a much more stable environment.  So, what does this mean?  Although 2023 will be a bumpy year, the experts predict the market will be more normalized in 2024. So, if you're a homeowner in Chicagoland wanting to sell and get ahead of the competition, now is the time to start reaching out to us.  We have helped homeowners sell their homes when another agent couldn't, and we've also saved our client's thousands of dollars by working with us on getting their homes ready for the market.  We know what it takes to succeed in the Chicagoland real estate market, and we can help you too!  Suppose you're a buyer, especially those who put their homebuying dreams on the shelves because of the highly competitive market and plan to stay in the home for several years. In that case, this may be the time for you to revisit buying again.  If you haven't already, we encourage you to watch the video on mortgage rates and what happened to rates during the last six recessions.  Also, there are 5-year arm products, negotiate with the sellers to contribute money towards a rate buydown, and more.  Then, when rates decline, you're not married to them so that you can refinance.  As always, if you have any questions regarding real estate or are ready to start working with us, please reach out to us on our website.  

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