The Chicago Real Estate Market & Why Chicago’s a Great Place to Live

In the past couple of years, mortgages have been a hot topic around the country.  With the subprime mortgage market being heavily scrutinized and the housing market feeling the pinch of the adjustable rate mortgage crisis, Chicago homeowners and mortgage shoppers are scrutinizing their mortgage options.

The Chicago housing market is not as inflated as other areas of the country, such as Los Angeles, but this doesn't mean that it's not feeling the tight grip of a suffering mortgage industry.  Lenders in the past had relaxed their rule on borrowers and because of this, many Chicago mortgage shoppers had found it easy to get into a home even when they could not afford your traditional fixed rate mortgage.  However, many of these were adjustable rate mortgages or interest only mortgages, both of these options made it easy for Chicago home buyers to get into a home, but they also hid the real cost of the home. 

Unfortunately, many Chicago homeowners have to make a transition from these adjustable rate mortgages because their mortgage interest rates are increasing at a steady rate and one that they simply can no longer afford. 

Throughout this article, you will learn about the various mortgage options available to Chicago homebuyers and how you can avoid these mortgage traps that millions of Americans are now trying to dig themselves out of. You will also find that Chicago has a lot more to offer to homeowners than mortgages, but excellent family events and services that help make Chicago a great place to live.

Your Credit and Your Chicago Mortgage

The first thing that potential Chicago homebuyers need to consider before even searching for a mortgage in Chicago is their credit score.  Your FICO score is developed by Fair Isaac & Co.  Your credit score will help a creditor determine whether or not you can afford to take on a Chicago mortgage.  Credit scores are calculated on a number of different criteria and you want your credit score to be as high as possible.  The various credit-scoring factors include:

·       Whether or not you have made late payments on bills such as mortgages, credit cards and loans.

·       The amount of time you have had credit established.

·       The amount of credit you have used versus the amount of credit you have available.

·       The length of time you have lived in your current residence.

·       Your employment history.

·       Negative credit information on your credit report such as bankruptcies, foreclosures and charge-offs.

There are three FICO scores that are used to determine your final score.  These scores are provided by the three main credit bureaus including Experian, Equifax and Trans Union.  Your credit score is vital in obtaining a Chicago mortgage that you can afford and it's vital that you keep your credit score as high as you can and the best way to do that is by paying your bills on time and not applying for credit too frequently.

The main reason that many people find themselves in mortgages that they cannot afford is because they do not have good credit history.  The poorer your credit history the higher your Chicago mortgage interest rates are going to be.  Conversely, the better your credit, the more affordable your Chicago mortgage interest rates will be.  Therefore, the better your credit, the better home you can afford and the better mortgage options you will have available to you.

If you have and maintain good credit, you should not have to worry about finding yourself in a Chicago mortgage that you can't afford in the long run, such as an adjustable rate mortgage, although they may seem more affordable now.  When it comes to a Chicago mortgage, your best bet on affordability is always going to be a fixed rate mortgage because you won't have a fluctuating interest rate that will come back to bite you later down the road.

Chicago Mortgage Options

In Chicago, you have several options when it comes to choosing a home.  You can purchase a house in a beautiful Chicago suburb, a condo, a townhouse or a loft.  Deciding which type of home you want to purchase is an important decision for you to make and is just as important as the type of Chicago mortgage you decide to take out. 

For most homeowners, their best bet on a Chicago mortgage is going to be a fixed-rate mortgage.  These are ideal for homebuyers who do not plan to move in the next seven years and who want a traditional fixed-rate mortgage.  These are ideal for individuals who are first time buyers, moving to a new home or relocating to the Chicago area, or have just finished building a new home in Chicago. These loans allow you to pay on both your interest as well as your principal.  The interest rate on the mortgage and the mortgage payment will never change during the life of the loan, unlike an adjustable rate mortgage.  This means you have the peace of mind knowing that your payments will never increase and they allow you to budget your finances accordingly. These loans are traditionally 30-year loans, but they can be adjusted to 10 or 15 years if you would like.  These allow you to pay your home off quicker and pay less interest over the life of the loan.

Adjustable rate mortgages, variable mortgages and subprime mortgages are all the same.  With these mortgages, there are periodic adjustments made to the interest rate on the loan.  This means that your monthly payments will fluctuate over time.  For those homebuyers who are not going to be living in the home for a very long amount of time or intend to resale the house quickly, these loans may be suitable.  However, many of the individuals who are provided these loans are those with poor credit ratings and low income.  These are the individuals who find themselves tied up in these loans and unable to make their mortgage payment as it increases on a monthly basis.

Why Chicago is a Great Place to Live

Chicago is considered to be one of the top 10 places to live in the United States.  In 2006, Chicago was voted as one of the best places to live by CNN Money.  There are several reasons that Chicago is considered a great place to live.  For one, the median home price is much lower than many large cities at about $254,500.  This makes finding an affordable Chicago mortgage quite easy.  Plus, there are a ton of things to do in the city. 

There are tons of attractions and sights to see in Chicago.  Restaurants are everywhere and you just simply won't get bored in this city. 

If you're trying to get an overall view of the city, then you want to start at the John Hancock Observatory or the Sears Tower Skydeck.  Here you can see literally see the city expanse for miles into the horizon. 

If museums are your fancy, then head over to The Museum Campus.  Located near Soldier Field, you'll find The Field Museum and the Adler Planetarium.  You will also find the Shedd Aquarium.  The aquarium is the world's largest indoor aquarium and features over 8,000 exotic animals. 

Chicago is home to two of the finest zoos in the country.  On the north side of the city, you'll find Lincoln Park Zoo, which is open and free everyday of the year.  In Brookfield, you'll find the Brookfield Zoo.  It is 216 acres of landscaped grounds featuring over 2,000 animals.

When it comes to dining, it won't be difficult to find a good meal.  With over 5,500 restaurants to choose from, you'll find everything from hot dogs and pizza to excellent Midwestern Steaks.  You can also always enjoy a nice dinner cruise on Lake Michigan where you'll be served champagne and elegant entrees and desserts.

Chicago has something to offer to everyone, making it an excellent place to call home.

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