Closing Chicago Real Estate

Saw these couple things in the news this week…

First, the Obama administration’s announcement that its Home Affordable Refinance program maximim loan will increase to 125% of a property’s loan-to-value ratio up from 105%. Here’s some coverage of the announcement and the release from HUD Secretary Donovan. Ho-hum is mostly my reaction…why do we want people owing 125% of an asset? Practically the rising interest rates over the last couple months have slowed refinance activity. This is unscientific but from one closing in early May to a closing I had on 6/30 the borrowers interest rate difference was 4.375% to 5.65%…and both were good credit borrowers.

Second, a nugget from the Trib’s Consumer Watch column regarding a resident’s inability to get a refund for a mistaken property tax payment. Of course the headline’s misleading…the parking spot owner didn’t pay his property’s taxes twice, he paid on another property first, realized his error, then paid the correct PIN, and now wants a refund for his WRONG payment. I’d side with the law and the explanation provided by the Treasurer, we do need trust-worthy property records. I’m relying on a title commitment at closing to tell me the property’s tax status and that can’t change after the fact which is what this guy wants.

Comments (0) Jul 03 2009

That’s the article title here from The Times. I hear a bit too much about credit scores than I want too and I think it’s absolutely the worst category of e-mail spam, but when it’s mortgage time you do need to be ready. And this is definitely new-to-me information:

¶ 35 percent is determined by your payment history. Do you regularly pay your bills or fines on time to any creditor that submits your information to the credit bureau? Even unpaid library fines, medical bills or parking tickets may appear here.

¶ 30 percent is based on the amounts you owe each of your creditors, and how that compares with the total credit available to you or the total loan amount you took out. If you’re maxing out your credit cards, your score may suffer.

¶ 15 percent is based on the length of your credit history, both how long you’ve had each account and how long it’s been since you had any activity on those accounts. The fewer and older the accounts, the better (assuming you’ve made timely payments).

¶ 10 percent is based on how many accounts you’ve recently opened compared with the total number of your accounts, as well as the number of recent inquiries on your report made by lenders to whom you’ve applied for credit. Your score can drop if it looks as if you’re seeking several new sources of credit — a sign that you may be in financial trouble. (If a lender initiates an inquiry about your credit report without your knowledge, though, it should not affect your score.) Shopping around for an auto loan or mortgage shouldn’t hurt, if you keep your search to six weeks or less. But every inquiry you trigger when you apply for a credit card can affect your score, says Craig Watts, a spokesman for Fair Isaac. So be selective.

¶ The final 10 percent is determined by the types of credit used. Having installment debt — like a mortgage, in which you pay a fixed amount each month — demonstrates that you can manage a large loan. But how you handle revolving debt, like credit cards, tends to carry more weight since it’s seen as more predictive of future behavior. (You can pay off the balance each month or just the minimum, for example, charge to the limit of your cards or rarely use them.)

Comments (0) Jun 24 2009

Some positive news from the IL Association of Realtors figures regarding May home sales released yesterday and here’s the story from the Tribune. Pretty consistent with what I’m feeling down at the micro-level. Sale prices up some 4% from April and the total number of homes sold up in the high teens from April, BUT, way down year-over-year.

I’m seeing a lot of buying activity out there and sales, if seller is pricing property appropriately rather than at 2007 values. The first 6 months of ‘09 we probably had 400% more residential transactions close in our firm compared to the last 6 months of ‘08 and I’d expect a similar increase over the second 6 months of ‘09.

Comments (0) Jun 24 2009

I have a residential closing tomorrow afternoon and just got a fax from the Seller’s attorney with his closing statement (which is somewhat standard) but he also included a page where he shows specifically how he calculated the real estate tax proration credit (often 105% or 110% of the last full year’s taxes). I like the gesture…it saves me some time and takes the guesswork out. It’s not a huge thing if I don’t see the math but then I’d have to pull a property tax bill, look at the contract, and get out a calculator.

Always striving for the perfect transaction…maybe tomorrow afternoon? 30 minutes with no snafoos?

Comments (2) Jun 24 2009

Two thumbs up to Circuit Clerk Dorothy Brown for publicizing this and putting up a link on the Website concerning possible $$ out there owed to persons who saw a home get foreclosed upon but then, upon public sale of the property, the property sold at sheriff’s sale for MORE than the amount owed on the mortgage…that overage is the former homeowners $$! Here’s the Sun-Times article link and the circuit clerk’s search page by name. I don’t do it anymore but a couple years back I’d actually conduct some auctions for foreclosure cases that had gone through the federal court system…mostly at the Lake County Courthouse in Waukegan or in the lobby of Daley Center. And, surprisingly every so often you’d get a sort of bidding war where I’d bet the price wasn’t that much worse than a regular old commercial sale.

Comments (2) Jun 21 2009

Comments (0) Jun 21 2009

I got that GREAT offer in the mail from Illinois Deed Provider, Inc. Nope I think I’m gonna take a pass. Not only did I, like every home buyer, get a recorded copy of my home’s deed returned to me after closing but a quick review of the Cook County Recorder’s Website suggests it charges a mere $20 bucks for a certified deed copy. And I’m there quite a bit anyways.

Seriously, anyone need a certified deed copy, I’ll get ya one for $75.

Comments (0) Jun 20 2009

A dreaded double…first there was the transaction where our listing agent failed to collect earnest money from a buyer making an offer and now the listing that apparently never was. All in the last 6 months.

Have people forgot the process since no property has been selling over the last 18 months??

And this recent faux listing wasn’t a big deal but it just is so eye opening that a supposed real estate broker would have these dated listings on her Website and the MLS and then not communicate with the buyer’s agent who submitted the offer for like a month before fessing up that this property isn’t for sale. Don’t think I’m going to be recommending you to my friends nor recommending that offers be made on your “real” listings.

Comments (0) Jun 20 2009

Some great posts here, here, and a comment from the wasserblawg regarding that ever moving target that is FHA insured financing. It seems times they are a-changin’ both in Springfield and Washington on this issue.

First, down at the General Assembly while they haven’t been passing a budget, both the House and Senate have approved HB0155 regarding condominium associations exercising their right of first refusal. It’s awaiting action from the Governor. Here’s a synopsis of the bill:

Amends the Condominium Property Act. Provides that in the event of a sale of a condominium unit by a unit owner, no condominium association shall exercise any right of refusal, option to purchase, or right to disapprove the sale, on the basis of the type of financing used by the purchaser.

Sadly, my analysis of this bill is that it’s worthless. Why? The reality is that condo associations NEVER exercise their rights of first refusal even if the most disagreeable potential buyer were set to move in or surely based on financing type. Why? What association wants to spend a few hundred thousand dollars to own a unit that provides no benefit to the general membership? Never happens!

The FHA mortgage letter seems like more of a mixed bag…looking negative in the short -term but good longer-term for condo buyers/sellers & associations. Take a look at Mike’s post for the nitty-gritty but my opinion is based on the elimination of the individual unit FHA “spot” approvals will surely hinder some buyers in the near-term. BUT, the elimination of the right of first refusal restrictions is a big positive going forward for buildings/associations who are on the ball and get their buildings/projects FHA approved.

Comments (0) Jun 20 2009

Just heard this referenced on TLC’s My First Home and had to post ’cause I had never heard of the program:

HUD’s Good Neighbor Next Door Program

A brief description…Law enforcement officers, pre-Kindergarten through 12th grade teachers and firefighters/emergency medical technicians can contribute to community revitalization while becoming homeowners through HUD’s Good Neighbor Next Door Sales Program. HUD offers a substantial incentive in the form of a discount of 50% from the list price of the home. In return you must commit to live in the property for 36 months as your sole residence.

From the look of things the one catch is many of the properties are in lets say transitional areas. While I’m on the subject, we just represented a Chicago Public School teacher who was elgible for a $3,000 closing cost credit for buying real estate in Chicago from CPS.

Comments (0) Jun 17 2009