• You prefer classic old homes in established neighborhoods over newly built sub-divisions. Yes, of course you can find new construction on the North Shore, but most of the homes are older, especially in the communities along the lakefront. In many cases they have been fully renovated so you can have your cake and eat it too. You get the character and charm that comes with a vintage house, yet with all the modern conveniences of a new home.

• You love boating, fishing, sailing or going to the beach and are determined to be near the lake so that you can take full advantage of the waterfront.

• You want your kids to go to great schools. The North Shore is not unique in this regard. Many of the Chicago suburbs have excellent schools. But New Trier High School and all of its feeder schools continue to represent the gold standard when it comes to children’s education. New Trier’s athletic programs are top-notch, too.

• You are willing to pay a premium for a home on the North Shore. It’s one of the costliest places to live in the Chicago area but homes here tend to hold their value better than elsewhere. Even in a bad real estate market, where foreclosures and short sales run rampant, fewer than 1% of the homes on the North Shore are distressed properties.

If the North Shore sounds like where you’d like to live, we’d be happy to give you our signature “Tour of the Shore” so you can get a feel for the area and see if it measures up. We think it’s a great place to live and we love helping people who are relocating here discover all of the wonderful things that the North Shore has to offer. Just give us a call at 847-881-6657 or email us.  You can search for a North Shore home here.

Related articles:

• Top Ten Reasons to Move to the North Shore
• Where’s the Best Place to Live on the North Shore?
• 5 Reasons to Hire a North Shore Agent (if you’re moving to the North Shore)
• Comparison of North Shore communities

It’s true that after a  foreclosure, short sale or bankruptcy there is a significant waiting period for mortgage eligibility but you are not locked out of homeownership forever. Betsy Hanrahan of PHH Home Loans provided the useful chart below to clarify wait times for mortgage eligibility, depending on the type of financing you are going for. If there are extenuating circumstances the wait time may actually be shorter than what’s shown in the table. An extenuating circumstance would be a temporary event beyond the borrower’s control, like loss of a job, medical bills or death of a wage earner. Unfortunately, however, divorce or the inability to sell a home after a job relocation do not qualify as extenuating circumstances.

If you are looking for information or advice about the mortgage qualification process, we have some excellent resources that can give you the guidance you need. Just give us a call at 847-881-6657 or drop us a line and we’ll be glad to refer you to one of our trusted mortgage professionals.

Related articles:

How Your Credit Score Affects Your Mortgage

But first things first. Let’s do a little Credit 101 to set the stage:

What is a credit score?
In a nutshell, your credit score is a three digit number that represents the risk that you will default on a loan, using your past payment history as a benchmark. Your score will determine IF you can get financing and AT WHAT RATE. Insurance companies, credit card companies and mortgage lenders all use different models to calculate creditworthiness. Since we’re talking about home loans here, we’ll focus on the FICO (Fair Isaac and Co.) score. A high FICO score means you will have an easier time getting a mortgage at a low interest rate.

How is my FICO score calculated?
There are five components of your score:

1. Payment history: Do you pay your bills on time? Yes, it matters.
2. Balances on revolving accounts (you don’t want your balance to be too high as a percentage of your credit limit)
3. Length of credit history: Longevity is good, so don’t cancel that credit card you’ve had since college
4. Types of credit accounts (you want to have a variety)
5. New credit: you lose points when you open a new account
   

What is considered a good FICO score?
FICO scores range from 300 to 850. 720 is around the median score in the U.S., so anything above that is considered a good score.

How do I find out my score?
There are three credit reporting companies which gather information and assign you a score: TransUnion, Experian and Equifax. By law, you may obtain one free report annually from each of them. Visit www.AnnualCreditReport.com to receive your free credit report. It’s the only free credit reporting website endorsed by the federal government. It really is important to check your credit report, because around 80% of Americans have errors and inaccuracies on their reports, and this can have a major impact on your borrowing power. Checking your report can also alert you to possible fraud or identity theft that you’ll need to take action on to protect yourself.

Important Advice for Home Buyers
If you are planning to buy a home in the near future, start now to get your credit report cleaned up. Get errors fixed. Pay down your balances. Don’t open or close any accounts. And DON’T make any major purchases on credit. Even after you are approved for your mortgage, DON’T buy that new flat screen TV or dining room furniture until after you close on your new home. Your lender may check your credit right up until closing.

Little Known Secrets to Improving Your Score

• Not only are you penalized if you have a balance on all your cards but also if you have a balance on none of them. You should actually use your credit (a little) and pay it back promptly.

• When you open a new account it hurts you in two ways: you get penalized just for opening the new account, but that new account also reduces your average length history, which makes your score go down.

• Pay off your smallest credit card first. You get just as many “points” as if you pay off a big one.

• If you’re going to cancel a credit card, cancel the youngest card first (most recently opened). Leave your old cards open, and use them.

• Once your credit balance is above 50% of your credit limit, you get penalized more.

• A corollary to the point above: request that your credit limit be increased, if you have good repayment history on it. This is NOT so you can use it, but to reduce your credit utilization ratio (i.e., the percentage of your available credit you are using).

• You should check your credit score a couple of times a year. But don’t do it too often. Too many credit inquiries (even by you) can hurt your score.

If you are looking for information or advice about the mortgage qualification process, we have some excellent resources that can give you the guidance you need. Just give us a call at 847-881-6657 or drop us a line and we’ll be glad to refer you to one of our trusted mortgage professionals.

A good Realtor will always accompany an appraiser and provide him with her analysis of comparable properties. Most appraisers will welcome this input ans take it into consideration when they are writing up the appraisal. This is a much more effective strategy than trying to challenge the appraisal number after the fact.

If you would like more information on finding a lender or understanding the role of appraisals in the mortgage process, give Brett a call at 847-239-7810 or email him at brett@lotsoffgroup.com.

If you would like more information on finding a lender and qualifying for a home mortgage, give Brett a call at 847-239-7810 or email him at brett@lotsoffgroup.com.

I read something surprising in a Wall Street Journal article by Amy Hoak: research suggests that renting has almost always been a better option than buying, from a financial standpoint. Really? But then I read the caveat: only if the renter invests all the money they save from renting. Ah…we all know that no one actually does that. Home ownership has always been a forced savings plan for Americans, allowing them to build equity as they pay off their home. That is until the housing meltdown when so many people ended up with negative equity.

Now the pendulum is swinging back in favor of buying in many cities, including Chicago. As demand for rentals has risen, so have rents, which are projected to rise about 4% this year. Home prices, on the other hand, have continued to fall, and interest rates are projected to hover around 4% in the near term.

Ms. Hoak offers these considerations if you are trying to decide whether to buy or rent:

1. Don’t rely on national statistics. Examine the housing market in your own area. Stan Humphries, the chief economist at Zillow.com offers a nifty ratio you can use to gauge housing affordability. To calculate the price-to-rent ratio, divide the purchase price of the house you would buy by 12 times the monthly rent of a comparable house. If it’s near 20 or above you may want to keep renting, but if it’s below 15 it may make sense to buy.
2. Consider additional costs. While your mortgage payment may be your biggest monthly cost, it won’t be the only one. There will also be insurance, taxes and maintenance.
3. Look into the future. What’s happening in your area? Is the overall economic health improving? Are companies and jobs coming into the area or leaving?
4. Think about your future plans, too. How long do you plan to stay in the house? If you’re planning to stay put for the long term, any cyclical declines in value will be offset by increases in time. On the other hand, if you only plan to stay 2 or 3 years, renting might be a better option.
5. Consider your personal finances. Will the down payment totally clean you out so you have nothing left over for other things? Do you feel secure in your job?
6. Think about opportunity costs. Could you get a better return putting the down payment into another investment vehicle?

On Chicago’s North Shore good and affordable rentals are scarce and go quickly. Right now there are 148 single family detached homes for rent in the nine communities I track. Sounds like a lot but only 18 of them are below $2,000/month and are three bedrooms or less. There are 39 between $2,000 and $2,999/month and the rest are $3,000 and above. The most expensive home for rent is in Glencoe for $30,000/month! But for that you get a 19 room mansion on the lake with 240 ft. of beachfront:

Priciest rental on the North Shore

Whether you decide to buy or rent your next North Shore home, we can help! Just give us a call at 847-881-6657 or email us and let us know what you’re looking for, and we’ll get right on it!

Not all towns have a transfer tax. For those that do, sometimes it’s the buyer who pays and sometimes it’s the seller. Here’s a guide to transfer taxes for the North Shore, as well as nearby towns that have them. For more information call the town hall. The phone numbers are noted in the notes section of the chart.

North Shore Municipal Transfer Taxes

Such is the case with the old “tried and true” practice of advertising homes for sale in newspapers.

The National Association of Realtors has done extensive research on home buyers and sellers, which showed (among other things) that only 2% of home buyers look for homes in newspapers and magazines. Nevertheless, agents and brokerages across the U.S. keep advertising there. Even when they know that it’s not effective, they do it anyway to appease their sellers, who (they believe) want to see their home in print.

Do you want your agent spending money on a marketing tactic that doesn’t work? Or would you prefer they put those dollars to work where there’s at least a fighting chance of being seen by your target buyer?

If you are selling your North Shore home, you need to know where and how to reach your target buyer, so that you and your agent can develop the most effective marketing strategy.  So, where are your prospective buyers looking for homes? According to this research, a combined 47% of buyers look online when starting their home search. (I’ve seen other research showing numbers as high as 90%).

Conclusion: The Internet is where you should be advertising to maximize exposure for your home.

Source: NAR Profile of Home Buyers and Sellers -2010

And where on the Internet should you be putting those ads? The sites that get the most buyer traffic are the ones that have the most listings: Realtor.com, Trulia, Zillow, large real estate brokerage web sites and individual agent sites. Any of these offers consumers the ability to access all of the listings in the MLS, and you should be on as many of them as you can to maximize your chances of attracting your buyer.

Source: NAR Profile of Home Buyers and Sellers -2010

Bottom line: Forget newspapers and magazines. The heyday of print advertising for real estate is long gone. Talk to your agent about developing an Internet marketing strategy that will do justice to your most valuable asset.

Oh, and it’s not just about advertising. You should also be utilizing social media to maximize your exposure: blogs, YouTube, Facebook, Twitter etc. But that’s an article for another day.

But nowadays, you can find really nice homes for under $500,000, even in the upscale towns along the lake. In fact, there are 232 houses for sale under $500K in the six lakefront communities of Wilmette, Winnetka, Kenilworth, Glencoe, Highland Park and Lake Forest, which is nearly twice as many as there were at the height of the market.

I’ve picked some houses to showcase in each of these communities so you can see what sort of house can be had for the money.  None of them are distressed properties or tear-downs (although there are plenty of those available, too, if that’s what you’re looking for). None of them are my listings. They are just nice houses that offer an affordable way to enjoy the North Shore lifestyle.

Wilmette

This cute house at 3134 Wilmette Avenue is bigger than it looks and is located in the award-winning Avoca school district. It is listed at $425,000 and has eight rooms, four bedrooms and two and a half baths. It has a first floor master with full bath, built-ins, new kitchen appliances, fireplace and newer roof.

Winnetka

This house is located at 836 Foxdale Avenue in East Winnetka. It has seven rooms, three bedrooms and three and a half baths (one of which is on the third floor along with two of the bedrooms). The master has a large walk-in closet. It has a large living room with a wood burning fireplace, separate dining room and a sun room. You can see more pictures here.

Kenilworth

Okay, admittedly it is rare to find a home in Kenilworth for under $500K. It’s a small community and it was originally developed to have large houses on large lots.  But sometimes an affordable home comes on the market (usually west of Green Bay Rd.). This house at 612 Exmoor Rd. listed at $474,000 is a great option if you want to take advantage of wonderful Sears School as well as New Trier.  It has eight rooms, three bedrooms and one and a half baths. The kitchen has been updated and the decor is fresh and young. It’s also an easy walk to the train. You can see a virtual tour here.

Glencoe

This Tudor home at 619 Drexel Avenue is right out of a storybook. It has tons of vintage details, including arched doorways, paneled doors, basket-weave tile and a gracious staircase. Listed at $464,000 it has eleven rooms, five bedrooms and three and a half baths (including a full master bath). The formal rooms are large and the kitchen has a separate eating area. As charming as it is on the outside, I will warn you that it needs updating inside. But other than the kitchen, what it needs is mostly cosmetic. You can see pictures of the inside here.

Highland Park

Highland Park has the largest number of affordable homes of all the lakefront communities. This home is a great example of the kind of value you can find in Highland Park. Located at 957 Princeton, this three bedroom home has been recently updated and its listed for $400,000. It has stainless steel appliances and granite in the kitchen, built-ins, a screened in patio, newer roof, and even a home theater in the basement. You can see more pictures here.

Lake Forest

This English Tudor home at 755 Northmoor is charming inside and out. Built in 1929 it is full of vintage features, including beamed ceilings, arched doorways, hardwood floors and vaulted ceilings. It is listed for $489,900 and has six rooms, three bedrooms (one of which is on the main floor) and two baths. It is close to town, the park and the beach. You can see more pictures here.

If you would like to see any of these houses or find out what other homes are available on the North Shore for under $500K, please call me at 847-687-5957 or send me an email. I would be happy to help you!

Coldwell Banker’s recently released study revealed that 75% of the 1,188 real estate agents polled said that the high cost of gasoline was impacting where consumer choose to buy a home:

• 89% said drive time and gas prices are causing home buyers to look for homes closer to work.
• 77% said more buyers today are interested in having a home office compared to five years ago. In fact, a home office is currently one of the “must have” features for today’s home buyer, according to Buffini and Company.

No doubt rising gas prices are fueling the continued interest in urban living, with 56% of agents saying that more home buyers are interested in urban living vs. five years ago.

• Of those 93% agreed that one reason is an increased interest in shorter commutes and 81% agreed that desire to reduce spending on gas is a factor.

For those who want to live in the suburbs and not go broke filling their tanks, the answer is to live on the North Shore, where the city is easily accessible via the Metra train. Downtown Chicago is just 32 minutes from Wilmette, 36 from Winnetka, 47 from Highland Park and 55 minutes from Lake Forest. Trains run frequently and there are express trains during morning and evening rush hours.