Chicago Condo Directory

May 23, 2009 - If you’ve been thinking about taking advantage of the $8,000 federal tax credit, you need to keep in mind that you only have until November 30, 2009 to close on a unit. With a stockpile of Chicago Condos For Sale, it shouldn’t be too hard to find something to suit your needs and wants. And if coming up with the down payment or closing costs is going to be a financial feat, you may be able to get an advance on that tax credit if you qualify for an FHA loan or mortgage.

The idea, according to an article in the Washing Post, is to give another jolt to home sales because as much as 50% of all potential first time home buyers do not have the money available to cover closing costs or a down payment. The National Association of Home Builders estimates that by allowing those who qualify for the $8,000 tax credit to receive it early it could double the number of home sales predicted for 2009 to over 300,000 units. That would of course hinge on how many states and lenders would join the effort.

The way it would work is that any bank or lender or even local government organization who had FHA authorization would give a temporary loan to a qualified buyer and then be reimbursed when the buyer receives their tax credit. Since a lot of mortgage companies may want to participate but have to have some time to come up with the funds, don’t count on this being a speedy process. It would be wise to get on the ball now and find that perfect piece of Chicago real estate, put the paperwork in motion and try to grab that American dream.

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May 12, 2009 - With all of the new fees imposed by Fannie Mae and Freddie Mac that recently went into effect, some would-be Chicago real estate buyers may feel as though they have a bulls eye on them when it comes to getting a condo mortgage. But there may be one less fee tacked on by brokers if a ruling by the federal district court in Alabama holds up. A class-action suit was filed against RealtySouth, which is a division of HomeServices of America, the number two realty company in the U.S. The case disputed the “administration” or “processing” fees that are added onto commissions and final settlement sheets, according to a Daily Herald report.

The real estate broker fees can range anywhere from $100 to $500 and sometimes come as a last minute surprise to the buyer. This is in addition to the real estate agent’s fee or commission, which is usually already in the thousands. The administration fee normally goes to the broker. The brokerage service claims to need these extra fees to continue business because some top selling real estate agents can demand up to 90 percent of the commission charged on a sale.

The article stated that federal ruling determined that realty companies charging an administrative fee for no specific service is illegal. The ruling would affect some 30,000 Realty South clients who have paid that administrative fee over the years and could be entitled to a refund HomeServices of America VP Dana Strandmo told the Daily Herald that he didn’t know if his company would appeal the ruling or not.

Since there have been other federal cases about unearned fees that have ruled differently, there really is no precedent set here. Some are calling for a uniform rate voluntarily set by brokers and disclosed to clients. But the best advice to buyers who are shopping for Condos In Chicago is to make sure you ask for a complete list of all services and fees before you sign with a broker or agent. That way you won’t be surprised in a not pleasant way at closing.

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May 4, 2009 - Probably a lot of Chicago condo owners are aware of the new rules and regulations that mortgage giant Fannie Mae has implemented over the past couple of months. Some went into effect on March 1st and others have been added since then. So a quick run down of the new guidelines might be helpful to anyone who already owns a condo and is considering refinancing or also a first-time buyer who needs a quick look at the facts. A list was recently posted in the Tribune and highlighted a few of the main points.

Before the changes, 51% of a new construction or renovated building’s total units were required to be owner-occupied. Now Fannie Mae requires that at least 70% of the units must be owner-occupied before they will approve a loan for a buyer. Already existing condo buildings must still have at least a 51% owner occupancy rate if the loan is secured by investors, and for buyers who intend to live in a condo in an existing building there is no percentage limit.

Assessments are another area where changes have been made. A maximum of 15% of the total condos are allowed to be 30 days overdue in assessment payments in both new and existing developments. This means that unsold units are included in the totals, which puts Chicago real estate developers with unsold inventory at a disadvantage to buyers because they will need to pay full assessments for Fannie Mae to approve a mortgage. Also, fidelity insurance is now required for new condo building that has 20 units or more, although Illinois mandates that buildings with 6 or more units have it.

Fannie Mae also now requires that an owner has “walls-in coverage” on their insurance. Typically a condo association will have insurance that covers equipment, fixtures and a certain amount of personal property. But now a condo owner must have an “HO-6″ insurance policy for at least 20% of the condo’s estimated value.

And a prospective buyer also needs to check with Fannie Mae because some developer incentives like sales concessions, price reductions, certain developer contributions and interest and principal abatements will now disqualify a mortgage, according to the article.

The new rules certainly make it more difficult for buyers to purchase or refinance some units, but there are other perks like the $8,000 first-time tax incentive that can make buying Condos In Chicago in bit easier.

Technorati Tags: Fannie Mae, New Condos In Chicago, Chicago Real Estate