Glossary

Design Styles Need help figuring out where to start? FREE CONSULTATION Where to Start? Prior to reaching out to several remodeling services, we're happy to give you advice on how much you might expect to pay for your home update. In our investment business, we work with several trusted construction and remodeling companies and we love sharing information with homeowners. We can also help you get estimates from various vendors anonymously so that you don't get bombarded with sales calls. Get an estimate by filling out the form, call/text 773-389-5166 , or email us at remodeling@padscouts.com First and Last Name Email Description Phone Number (Optional) Upload up to 5 pictures (15mb or less) Select File Get Estimate Understand Your Reason The reason for why you want to start a home improvement or remodeling project is very important to how we advise you on the project. There are different factors to consider depending on the reason for the renovation. For example, an improvement project to increase the home's value is different than building out your forever home concept. Increase Value Forever Home Functionality Style Update Process Gather Information - Create a mood board Get Virtual Estimate - Call Consultation or Physical Estimate With Estimator(s) - Design Process & Receive Proposal(s) Accept Proposal & Sign Agreement Schedule Construction Dates Execute Construction Final Walkthrough & Sign-off Completion Timeline Budget Materials Design Styles Learn More Services The reason for why you want to start a home improvement or remodeling project is very important to how we advise you on the project. Timeline Budget Scope of Work Expectations Anchor 1

Contingency of Sale If your proposal says, "This offer is contingent upon (or subject to) a certain event", you're saying you will go through with the purchase only if that event occurs. The following are two common contingencies contained in a purchase offer: Financing. You, the buyer, must be able to get specific financing from a lending institution . If you can't secure the loan, you will not be bound by the contract. Home inspection . The property must get a satisfactory report by a home inspector "within 10 days after acceptance of the offer" (for example). The seller must wait 10 days to see if the inspector submits a report that satisfies you. If not, the contract would become void. Again, make sure all inspection conditions are detailed in the written contract. The above two examples are contingencies that are common for residential real estate home purchases. However, contingencies can be more specific to your situation. And, technically, you can write in any contingency you would like in an offer or what the Seller would like to add in the counter offer . However, contingencies are only valid for a contract if both the buyer and the seller agree and accept the offer.

Appraiser An appraiser is a professional that is certified and licensed by each State to properly assess the value of a property and provide their clients with an appraisal report for the property. According to the Appraisal Institute, an association of professional real estate appraisers, a qualified appraiser should be licensed or certified—as required in all 50 states—and be familiar with the local area. Per federal regulations, the appraiser must be impartial and have no direct or indirect interest in the transaction.

Mortgage Loan A home mortgage is a loan given by a financial institution for the purchase of a residence—either a primary residence, a secondary residence, or an investment residence—in contrast to a piece of commercial or industrial property. Depending on the State where the property resides, in a home mortgage, either a mortgage lien is placed on the title of the property OR the owner of the property (the borrower) transfers the title to the lender on the condition that the title will be transferred back to the owner once the final loan payment has been made and other terms of the mortgage have been met or a mortgage lien will be placed on the title. A mortgage payment is composed of 4 components, simply known as PITI - which is the Principal , Interest , Taxes , and Interest . Principal The principal of your mortgage is the amount that you owe before any interest is added. For example, if you buy a home worth $250,000 with a 20% down payment, your principal amount would be $200,000. However, throughout the life of the loan, you pay more than your original $200,000 because of interest. Most lenders look at your principal balance and debt-to-income (DTI) ratio when they consider whether they should extend you a loan. Your debt to income (DTI) ratio is a calculation of your ability to make payments toward money you’ve borrowed. Your DTI ratio is comprised of your total minimum monthly debt divided by your gross monthly income and is expressed as a percentage. A mortgage company will evaluate two ratios: Front Ratio = monthly housing payments/gross monthly income (should be <30%) Back Ratio = total monthly debt obligations/gross monthly income (should be <40%) Interest An interest rate is a percentage that shows how much you’ll pay your lender each month as a fee for borrowing money. Your mortgage lender calculates interest as a percentage of your principal over time. For example, if your principal loan is worth $200,000 and your lender charges you an interest rate of 4%, this means that you pay $8,000 (4% of $200,000) for the first year of your mortgage in interest. Taxes You must pay taxes on your property. Taxes are one of the often-overlooked costs of homeownership. It’s important to consider them when you think about how much home you can afford. The most expensive tax most homeowners pay is property tax, which may vary by location. Property taxes support the local community and pay for things like libraries, local fire departments, public schools, road and park maintenance and community development projects. It’s difficult to say exactly how much you can expect to pay in taxes because they depend upon your home’s value and your local property tax rate. Taxes can vary from year to year. As a general rule, anticipate paying $1 for every $1,000 of your home’s value every month in property taxes. For example, if your home is worth $250,000, you pay around $250 per month in property taxes or about $3,000 per year. Insurance Home Owners Insurance Though homeowners insurance is not required by law in most states, most mortgage lenders require that you maintain at least a certain level of property insurance as a condition of your loan. Homeowners insurance covers your property if a fire, lightning storm or break-in occurs. Some homeowners insurance policies include additional coverage for damage from flooding and earthquakes as add-ons. If you have something very valuable in your home, like a piece of artwork, an expensive piece of jewelry or a musical instrument, you may purchase a high-value layer of protection called a rider in addition to your standard policy. If you live in a condominium, you’ll usually pay a homeowners association fee in lieu of individual insurance that covers your dwelling. Like property insurance, it’s difficult to say exactly how much you can expect to pay in property insurance because every insurance company uses their own unique formula when they calculate your rates. Some factors that influence your premium include: Your home’s value Whether you live in a rural area or an urban area How close you live to a fire department or police station Whether you have an attractive nuisance on your property, which is something that is likely to injure children who enter your property like a pool, trampoline or aggressive dog How many claims you make each year on average for other types of insurance As a general rule, expect to pay about $3.50 for every $1,000 of your home’s value in homeowner’s insurance per year. In this example, you will pay $875 on a property worth $250,000 per year, or about $73 per month. Private Mortgage Insurance PMI — private mortgage insurance — is a type of insurance policy that protects mortgage lenders in case borrowers default on their loans. Here’s how it works: If a borrower defaults on their home loan, it’s assumed the lender will lose about 20 percent of the home’s sales price. 20 percent — sound familiar? That’s the smallest down payment you can make without having to pay mortgage insurance. If you put down 20 percent, that makes up for the lender’s potential loss if your loan defaults. But if you put down less than 20 percent, the lender will usually require mortgage insurance. Mortgage insurance covers that extra loss margin for the lender. If you ever default on your loan, it’s the lender that will receive a mortgage insurance check to cover its losses. How much is mortgage insurance? Mortgage insurance costs vary by loan program. But in general, mortgage insurance is about 0.5-1.5% of the loan amount per year. So for a $250,000 loan, mortgage insurance would cost around $1,250-$3,750 annually — or $100-315 per month. Mortgage Products Terms Mortgages are provided by mortgage companies . Most mortgage companies are able to help you facilitate the application for a Conventional Loan, FHA Loan, USDA Loan, or a VA Loan . Each of these types of loans also come in a variety of terms. Below are some examples of what you product terms you may encounter: Long-Term Fixed Mortgages (30-year) This is a mortgage loan where you will make monthly payments for 30 years. It is called a "fixed" mortgage because the interest rates are "fixed" meaning they remain the same for the duration of the loan. If you were quoted for a 4% interest rate, you will pay the same annual interest rate for 30 years. The benefit of choosing a 30-year fixed mortgage compared to a short-term fixed mortgage is having lower monthly mortgage payments. The downside is that you will pay a much greater amount of interest over time. The benefit of choosing a fixed mortgage over an adjustable rate mortgage is being able to know your interests will not change over time. Adjustable Rate Mortgages interest change depending on the market rate which means your monthly loan payments may change over time. Short-Term Fixed Mortgages (15-year) This is a mortgage loan where you will make monthly payments for 15 years. It is called a "fixed" mortgage because the interest rates are "fixed" meaning they remain the same for the duration of the loan. If you were quoted for a 4% interest rate, you will pay the same annual interest rate for 15 years. Short-Term fixed mortgages come with higher monthly payments compared to long-term fixed mortgages because you will be paying off the principal at a higher rate. The benefit over long-term fixed mortgages is that you pay less interest overall on the loan. Adjustable Rate Mortgages (ARM) An adjustable-rate mortgage (ARM) is a type of mortgage in which the interest rate applied on the outstanding balance varies throughout the life of the loan. With an adjustable-rate mortgage, the initial interest rate is fixed for a period of time. After this initial period of time, the interest rate resets periodically, at yearly or even monthly intervals. ARMs are also called variable-rate mortgages or floating mortgages. With adjustable-rate mortgage caps, there are limits set on how much the interest rates and/or payments can rise per year or over the lifetime of the loan. An ARM can be a smart financial choice for home buyers that are planning to pay off the loan in full within a specific amount of time or those who will not be financially hurt when the rate adjusts. Home Equity Line of Credit (HELOC) With a HELOC, you’re borrowing against the available equity in your home and the house is used as collateral for the line of credit. As you repay your outstanding balance, the amount of available credit is replenished – much like a credit card. This means you can borrow against it again if you need to, and you can borrow as little or as much as you need throughout your draw period (typically 10 years) up to the credit limit you establish at closing. At the end of the draw period, the repayment period (typically 20 years) begins. To qualify for a HELOC, you need to have available equity in your home, meaning that the amount you owe on your home must be less than the value of your home. You can typically borrow up to 85% of the value of your home minus the amount you owe. Also, a lender generally looks at your credit score and history, employment history, monthly income and monthly debts, just as when you first got your mortgage. Similar to mortgage loans, HELOCs can come with variable interest rate or fixed interest rate options.

Mortgage Professionals There are four main types of mortgage companies where you can apply and receive a mortgage loan, and the one that works best for you will depend on your situation: Banks and Mortgage Bankers - This is a great option if you prefer to have all of your financial accounts in one place; however, it may take longer to close your loan. Additionally, they may not offer government-backed loans (for example, FHA, VA, or USDA home loans). Perhaps the most common of all financial institutions are banks. Banks get their money from investors and its own customers. In addition to offering checking and savings and investment options, banks will often offer different types of mortgage loans for qualified borrowers. For many people, their local bank is the first and possibly only financial institution they will ever do business with. Credit Unions - Credit unions usually offer loans only to their members. They may have lower costs and interest rates, but like banks, they may take longer to close. Like banks, they may not offer government-backed loans. Credit unions are very similar to banks, except that they are owned by their account holders, known as members. These institutions usually require membership and get funds from their members. Similar to their bank counterparts, credit unions offer a range of services to their members such as depository accounts for checking, savings, and retirement. As with banks, credit union members will often utilize their institution as a one-stop shop, obtaining their mortgage loan, as well as all their other banking needs at the same place. Mortgage Lenders - Unlike banks and credit unions, which offer a variety of financial services, mortgage lenders exist for the sole purpose of real estate loans. Unlike banks and credit unions, most mortgage lenders can take care of the entire process “in-house.” This can shorten the time frame involved with obtaining a mortgage. A mortgage lender is a financial institution, similar to a bank, that originates and funds loans in their own name. Unlike banks and credit unions, mortgage lenders exist for the sole purpose of making loans against real estate. Most mortgage lenders do not service, or “keep”, their loans. Instead, lenders sell their loans to banks or servicing companies. These servicers then take on the job of collecting payments on a monthly basis. Mortgage lenders get their money from banks, also known as investors. Unlike banks and credit unions, most lenders do all their own loan processing, underwriting and closing functions “in-house.” They can take care of the entire process with internal staff. In-house operations shorten the time frame involved with obtaining a mortgage loan. Mortgage Brokers - Mortgage brokers do not lend money directly; rather they have access to many different lenders and loan programs. This can give you access to more options. But they do not have as much control over the speed of a loan approval as a bank or mortgage lender. A mortgage broker is essentially a “middleman” between the homeowner and bank. Mortgage brokers do not lend money directly. Brokers have access to many lenders, as well as many different loan programs. In some cases, especially when your credit isn’t perfect, a mortgage broker can shop around to find a home loan that isn’t offered by a bank, credit union, or even a lender. Home buyers with special income types, lower credit, or are looking at a unique property might inquire at a broker first. Or, if your home bank or credit union can’t approve you, your next step is to talk to mortgage companies and brokers.

Closing Costs After saving for a down payment, house hunting and applying for a mortgage, closing costs can come as an unpleasant surprise. What are Closing Costs? Closing costs include the myriad fees for the services and expenses required to finalize a mortgage. You’ll have to pay closing costs whether you buy a home or refinance. Most of the closing costs fall on the buyer, but the seller typically has to pay a few, too, such as the real estate agent’s commission. (Buying a home for the first time? See our tips for first-time home buyers.) How much are closing costs? Average closing costs for the buyer run between about 2% and 5% of the loan amount. That means, on a $300,000 home purchase, you would pay from $6,000 to $15,000 in closing costs. The most cost-effective way to cover your closing costs is to pay them out-of-pocket as a one-time expense. You may be able to finance them by folding them into the loan, if the lender allows, but then you’ll pay interest on those costs through the life of the mortgage. When buying a home, you can comparison shop and negotiate some of the fees to lower your closing costs. And some states, counties and cities offer low-interest loan programs or grants to help first-time home buyers with closing costs. Check with your local government to see what’s available. Your lender is required to outline your closing costs in the Loan Estimate you receive when you first apply for the loan and in the Closing Disclosure document you receive in the days before the settlement. Review them closely and ask questions about anything you don’t understand. List of Closing Costs (may not be comprehensive depending on the situation) Property-related fees Appraisal fee: It’s important to a lender to know if the property is worth as much as the amount you want to borrow. This is for two reasons: The lender needs to verify the amount you need for a loan is justified and make sure it can recoup the value of the home if you default on your loan. The average cost of a home appraisal by a certified professional appraiser ranges between $300 and $400. Home inspection: Most lenders require a home inspection, especially if you’re getting a government-backed mortgage, such as an FHA loan insured by the Federal Housing Administration. Before lending you hundreds of thousands of dollars, a bank needs to make sure the home is structurally sound and in good enough shape to live in. If the inspection turns up troubling results, you may be able to negotiate a lower sale price. But depending on how severe the problems are, you have the option to back out of your contract if you and the seller can’t come to an agreement on how to fix the issues. Home inspection fees, on average, range from $300 to $500. Loan-related fees Application fee: This covers the cost of processing your request for a new loan and includes costs such as credit checks and administrative expenses. The application fee varies depending on the lender and the amount of work it takes to process your loan application. Assumption fee: If the seller has an assumable mortgage and you take over the remaining balance of the loan, you may be charged a variable fee based on the balance. Attorney’s fees: Some states require an attorney to be present at the closing of a real estate purchase. The fee will vary depending on the number of hours the attorney works for you. Prepaid interest: Most lenders require buyers to pay the interest that accrues on the mortgage between the date of settlement and the first monthly payment due date, so be prepared to pay that amount at closing; it will depend on your loan size. Loan origination fee: This is a big one. It’s also known as an underwriting fee, administrative fee or processing fee. The loan origination fee is a charge by the lender for evaluating and preparing your mortgage loan. This can cover document preparation, notary fees and the lender’s attorney fees. Expect to pay about 0.5% of the amount you’re borrowing. A $300,000 loan, for example, would result in a loan origination fee of $1,500. Discount points: By paying discount points, you reduce the interest rate you pay over the life of your loan, which results in more competitive mortgage rates. The cost of one point equals 1% of the loan amount. So for a loan of $250,000, a 1-point payment would be $2,500. Generally, paying points is worthwhile only if you plan to stay in the home for a long time. Otherwise, the upfront cost isn’t worth it. Mortgage broker fee: If you work with a mortgage broker to find a loan, the broker will usually charge a commission as a percentage of the loan amount. The commission averages from 0.5% to 2.75% of the home’s purchase price Mortgage Insurance Fees Mortgage insurance application fee: If you make a down payment of less than 20%, you may have to get private mortgage insurance. (PMI insures the lender in case you default; it doesn't insure the home.) The application fee varies by lender. Upfront mortgage insurance: Some lenders require borrowers to pay the first year’s mortgage insurance premium upfront, while others ask for a lump-sum payment that covers the life of the loan. Expect to pay from 0.55% to 2.25% of the purchase price for mortgage insurance, according to Genworth, Ginnie Mae and the Urban Institute. FHA, VA and USDA fees: If your loan is insured by the Federal Housing Administration, you’ll have to pay FHA mortgage insurance premiums; if it’s guaranteed by the Department of Veterans Affairs or the U.S. Department of Agriculture, you’ll pay guarantee fees. In addition to monthly premiums, the FHA requires an upfront premium payment of 1.75% of the loan amount. The USDA loan upfront guarantee fee is 1%. VA loan guarantee fees range from 1.25% to 3.3% of the loan amount, depending on the size of your down payment. Property taxes, annual fees and insurance Property taxes: Buyers typically pay two months’ worth of city and county property taxes at closing. Annual assessments: If your condo or homeowners association requires an annual fee, you might have to pay it upfront in one lump sum. Homeowners insurance premium: Usually, your lender requires that you purchase homeowner’s insurance before settlement, which covers the property in case of vandalism, damage and so on. Some condo associations include insurance in the monthly condo fee. The amount varies depending on where you live and your home’s value. Title Fees Title search fee: A title search is conducted to ensure that the person selling the house actually owns it and that there are no outstanding claims or liens against the property. This can be fairly labor-intensive, especially if the real estate records aren’t computerized. Title search fees are about $200, but can vary among title companies by region. The search fee may be included in the cost of title insurance. Lender’s title insurance: Most lenders require what’s called a loan policy; it protects them in case there’s an error in the title search and someone makes a claim of ownership on the property after it’s sold. Coverage lasts until the loan is paid off. Owner’s title insurance: You should also consider purchasing title insurance to protect yourself in case title problems or claims are made on your home after closing. The owner's coverage lasts as long as you or your heirs own the property. The cost of the owner’s policy is about 0.5% to 1% of the purchase price, according to the American Land Title Association. Whether the buyer or seller pays for title insurance varies by region. A discount is sometimes offered when both the lender’s and owner’s policies are purchased at the same time. Mortgage Closing Documents With so many closing costs to consider, it’s obvious you’ll face a lot of paperwork just prior to and during the loan signing. Two of the most important closing documents are the Loan Estimate and the Closing Disclosure. You’ll receive the Loan Estimate three days after applying with a lender. It will officially detail all fees, the interest rate and the other costs to close your loan. It’s legally binding, so you’ll want to read it carefully. Then, three days from loan settlement and prior to making the big commitment, you’ll receive the Closing Disclosure from your lender. It confirms — or makes minor adjustments to — what you saw on the Loan Estimate. Again, it’s worth a big cup of coffee and a thorough review. Mortgage closing costs: summary Appraisal fee ($300-$400) Home inspection ($300-$500) Application fee (varies) Assumption fee (varies) Attorney’s fee (hourly or flat fee) Prepaid interest (based on loan amount) Origination fee (about 0.5% of loan amount) Discount points (1 point costs 1% of the loan amount) Mortgage broker fee (0.50% to 2.75%) Mortgage insurance application fee (varies) Upfront mortgage insurance (0.55% to 2.25%) FHA, VA and USDA fees (1% to 3.3%) Property taxes (two months’ worth) Upfront HOA fee (varies) Homeowners insurance (depends on home value and location) Title search fee (about $200) Lender’s title insurance (varies) Owner’s title insurance (0.5% to 1% of purchase price)

Marketing Plan The most basic strategy in the real estate marketing plan is ensuring that a property has professional pictures taken of the home, priced correctly in the market, and listed on the Multiple Listing Service (MLS). Once it is listed in the MLS, the listing should be syndicated to all of the major marketing websites such as Zillow.com, Realtor.com, etc. Most homes are found by buyers through these real estate websites. The MLS also allows local Realtors to be notified of the availability of a local property. Listing a property onto the MLS is the crucial first step to selling a property. A good listing agent will present a concise marketing strategy to you. They will show you examples such as listing on the MLS, hosting open houses, and sending out targeted campaigns. However, sellers should participate in the marketing process. Here are some examples of how sellers can participate in the process: opting for professional photography and virtual tours, or tapping into their personal networks to find interested buyers. It’s impossible to prepare a marketing plan that targets every buyer. But, in order to improve the chances of selling your property, it is necessary to understand the buyers in your market. Each market is different so this page will only attempt to speak to the macro national trends in the market, which is to market towards millennials (the current generation that is actively purchasing real estate). Real Estate Marketing For Millennials: 5 Tips For Success Those who hope to successfully sell to today’s buyers must actively take part in real estate marketing for millennials. Traditional marketing tactics may not work on these digital natives, and real estate professionals who take the initiative to understand this generation’s consumer preferences and behavior will develop an advantage. The following are 5 unique tips to find success in selling to the millennial home buyer: Help them each step of the way: 90% of home buyers aged 37 and younger worked with a real estate agent, and many of them cited that they wanted help in understanding the home buying process. Understand that guidance is extremely important to this consumer segment, and take advantage by marketing your emphasis in assisting clients. Know that price matters: A majority of millennials use their savings to pay their down payment, more so than other generations, signaling limitations in financial options. Help these buyers by suggesting how to save money or use their funds in the most impactful way during the home buying process. Pay attention to visual representation: Visually-based social media platforms such as Instagram and Pinterest are popular amongst young home buyers. In addition, many of them cite staging as an important factor filtering through properties online. Do not hesitate to market your property in a visually-compelling manner, such as through Instagram or Pinterest. Specify your competitive advantage: Millennials know that each real estate agent has something unique to offer, so be ready to stand out from a group of candidates by clearly specifying what you have to offer to them. Go digital: Is should go without saying that the best way to appeal to this generation of digital natives is through digital marketing. 93% of home buyers aged 37 and younger use the internet for their home buying process. There are a variety of trends associated with the millennial home buyer, and as a seller or real estate professional, it is important to keep up with the latest statistics and information. Each generation has its own unique tastes and preferences, and furthermore, there are divergences within each of those home buyer segments. Those who make an effort to keep up with these preferences, and take the extra step to understand why consumers have these preferences, are best able to serve these home buyers’ needs.

Pricing Strategy Being able to sell your home quickly is a matter of competitive pricing. There is a fine line between pricing low enough to sell, versus pricing just above market value. Your Realtor is responsible for conducting a market analysis in order to recommend the best possible listing price to help your property sell within a reasonable amount of time. Although the Realtor may recommend a price, the Seller is ultimately the person who will make the final decision. Each Seller’s situation is different and you’re allowed to sell your property for lower or higher than your Realtor’s recommendation. But, speak with your Realtor to understand the implications of selling higher or lower than the recommended list price.

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Calculate Your Proceeds When an offer comes in, a seller can accept it exactly as it stands, refuse it (seldom a useful response), or make a counteroffer with the changes they want. In evaluating a purchase offer, sellers estimate the amount of cash they'll walk away with when the transaction is complete. For example, when they're presented with two offers at once, they may discover they are better off accepting the one with the lower sale price if the other asks them to pay points to the buyer's lending institution. Once a seller has a specific proposal, calculating net proceeds becomes simple. From the proposed purchase price, they subtract the following: Payoff amount on present mortgage Any other liens (equity loan, judgments) Broker's commission Legal costs of selling (attorney, escrow agent) Transfer taxes Unpaid property taxes and water bills If required by the contract: cost of survey, termite inspection, buyer's closing costs, repairs, etc. The seller's mortgage lender may maintain an escrow account into which they deposit money to pay property tax bills and homeowner's insurance premiums. In that case, remember sellers will receive a refund of money left in that account, which will add to their proceeds.

Types of Mortgages There are four main types of mortgage loans. They are the Conventional Loan , FHA Loan , VA Loan, and the USDA Loan . The one that works best for you will depend on your situation: Conventional Loan - When most people think of a mortgage, they’re thinking of a conventional loan. Conventional loans are the closest you can get to a ‘standard’ mortgage. There are no special eligibility requirements, pretty much all lenders offer them, and you can qualify with just 3% down and a 620 credit score. Conventional loan requirements vary by lender. However, all conventional loans have to meet certain guidelines set by Fannie Mae and Freddie Mac. These include a 620 credit score, a debt-to-income ratio lower than 43%, and at least a 3% down payment. The mortgage also has to be within conventional loan limits: up to $510,400 in most areas. If you apply for a conventional loan with better credentials — like a credit score of 740+ and 20% down payment — you’ll get access to lower rates and a lower monthly payment. On the flip side, maybe you’re just on the edge of qualifying for a conventional loan. If you have a credit score right around 620, and higher levels of debt, you’ll want to be extra sure to shop around. Thanks to their wide availability and low rates, conventional loans are the most popular mortgage in the U.S. In fact, almost 3 in 5 buyers use a conventional loan when they buy a house or refinance. Minimum down payment for a conventional loan It’s a common myth that you need a 20 percent down payment for a conventional loan; you can actually get one with as little as 3 percent down. All told, there are six major options for conventional loan down payments, ranging from 3-20 percent. Conventional 97 loan — 3% down Fannie Mae HomeReady loan — 3% down Freddie Mac Home Possible loan — 3% down Conventional loan with PMI — 5% down Piggyback loan (no PMI) — 10% down Conventional loan without PMI — 20% down For more information about HomeReadyTM and Conventional 97, and piggyback loans, contact your mortgage professional. If you’re in Illinois and would like assistance in learning more about mortgages, ask us and we can point you to a few mortgage professional options. FHA - An FHA loan is a mortgage insured by the Federal Housing Administration. FHA insurance protects mortgage lenders, allowing them to offer loans with below-average interest rates, easier credit requirements, and low down payments (starting at just 3.5%). FHA loans are especially popular with first time, lower-income, and/or lower-credit home buyers, thanks to their flexibility and low rates. But FHA financing isn’t limited to a certain type of buyer — anyone can apply. To qualify for an FHA home loan, you’ll need to meet these requirements: A 3.5 percent down payment if your credit score is 580 or higher A 10 percent down payment if your credit score is 500-579 A debt-to-income ratio of 50% or less Documented, steady employment and income You’ll live in the home as your primary residence You have not had a foreclosure in the last three years FHA loans usually have below-market interest rates. That means they’re lower, on average, than comparable conventional loans. Note, the APR on an FHA loan is often higher than the APR on a conventional loan. That’s because FHA rate estimates include mortgage insurance, while conventional rate estimates assume 20% down and no mortgage insurance. USDA Loans - USDA loans are mortgages backed by the U.S. Department of Agriculture as part of its USDA Rural Development Guaranteed Housing Loan program. USDA loans are available to home buyers with low-to-average income for their area, offer 100% financing with reduced mortgage insurance premiums, and feature below-market mortgage rates. USDA home loans are putting people in homes who never thought they could do anything but rent. USDA loans are special mortgages meant for low- to moderate-income home buyers. These loans are guaranteed by the US Department of Agriculture. That guarantee acts as a form of insurance protecting USDA mortgage lenders, so they’re able to offer below-market interest rates and zero-down home loans. USDA runs this program to encourage homeownership and economic development in rural areas. Insurance - USDA “guarantees” its loan program — meaning it offers protection to mortgage lenders in case USDA borrowers default. But the program is partially self-funded. So, to keep it running, the USDA uses homeowner-paid mortgage insurance premiums. As of 2016, this is the current mortgage insurance rates For purchases, 1.00% upfront fee paid at closing, based on the loan size As a real-life example: A homebuyer with a $100,000 loan size in Blacksburg, Virginia, would be required to make a $1,000 upfront mortgage insurance premium payment at closing, plus a monthly $29.17 payment for mortgage insurance. USDA upfront mortgage insurance is not paid as cash. It’s added to your loan balance for you. Eligibility - USDA eligibility is based on the buyer and the property. First, the home must be in a qualified “rural” area, which USDA typically defines as a population of less than 20,000. Second, the buyer must meet USDA income caps. To be eligible, you can’t make more than 15% above the local median salary. You also have to use the home as your primary residence (no vacation homes or investment properties allowed). Borrowers also have to meet USDA's "ability to repay" standards including: Steady job and income, proven by tax returns FICO credit score of at least 640 (though this can vary by lender) Debt-to-income ratio of 41% or less in most cases See if a property is eligible for the USDA Loans: https://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do?pageAction=mfhc VA Loan - VA loans are mortgages backed by the U.S. Department of Veteran Affairs for veterans who have served in the United States armed forces. VA Loan Eligibility for Veterans Most veterans must complete a minimum term of qualifying active-duty service to be eligible for a VA loan, though this requirement does have a few exceptions. The minimum term of service varies depending on the dates of that service. Veterans serving from August 2, 1990 through The Present Day Veterans who served from August 2, 1990 through the present day must have completed 24 months of continuous service or a full period of at least 90 days during which they were called or ordered to active duty. Veterans serving from September 8, 1980 through August 1, 1990 Veterans who served from September 8, 1980, through August 1, 1990, must have completed 24 months of continuous service or a full period of at least 181 days of active duty. The beginning date that applies to officers for this requirement is October 17, 1981. Veterans serving from May 8, 1975 through September 7, 1980 Veterans who served from May 8, 1975, through September 7, 1980, must have completed 181 continuous days of active duty. The ending date that applies to officers for this requirement is October 16, 1981. Veterans serving from August 5, 1964 through May 7, 1975 Veterans who served from August 5, 1964, through May 7, 1975, must have completed 90 days of active duty. The beginning date that applies to veterans who served in the Republic of Vietnam for this requirement is February 28, 1961. Veterans serving from February 1, 1955 through August 4, 1964 Veterans who served from February 1, 1955 through August 4, 1964 must have completed 181 continuous days of active duty. Veterans serving from June 27, 1950 through January 31, 1955 Veterans who served from June 27, 1950 through January 31, 1955 must have completed 90 days of active duty. Veterans serving from July 26, 1947 through June 26, 1950 Veterans who served from July 26, 1947 through June 26, 1950 must have completed 181 continuous days of active duty. Veterans serving from September 16, 1940 through July 25, 1947 Veterans who served from September 16, 1940 through July 25, 1947 must have completed 90 days of active duty. Additional eligibility requirements for veterans Veterans who were discharged due to hardship, government convenience, reduction-in-force, certain medical conditions or a disability connected to military service can be eligible for a VA loan even if they don’t meet the minimum term of service requirement. Veterans who were dishonorably discharged are not eligible for the VA home loan program. VA Loan Eligibility for Non-Veterans - The VA home loan program is available to non-veterans, too. This eligibility class includes certain active military borrowers, their families, and others. Service members on active duty Active-duty service members can be eligible for a VA loan after they have served 90 days of continuous active duty. Army, Navy, Air Force and Marines are eligible. Military spouses Some military spouses can be eligible for a VA loan, too. If the service member to whom the spouse is married is alive, the spouse can be eligible if the service member has been officially declared missing in action (MIA) or a prisoner of war (POW) for at least 90 days. This eligibility is limited to one-time use. If the service member to whom the spouse was married has died, the surviving spouse can be eligible if he or she hasn’t remarried and the service member died on active duty, was a totally disabled veteran or was a veteran who died as a result of a service-connected disability. Spouses who have remarried may be subject to more complicated rules. A consultation with a VA-approved lender may be required. A spouse who obtained a VA home loan with an active-duty service member or veteran who subsequently died can be eligible to refinance that VA loan with a new VA loan at a lower interest rate through the VA streamlined refinance program. The service member's or veteran’s death need not be related to his or her service in this case. Children of active-duty service members or veterans, whether alive or deceased, aren’t eligible for VA loans as a benefit of the parent’s service. Reservists and National Guard members Members of the National Guard and Reserves can be eligible for VA loans if they have completed six years of service in the Selected Reserve or National Guard and they continue to serve in the Selected Reserve or were honorably discharged, placed on the retired list or transferred after honorable service to the Standby Reserve or an element of the Ready Reserve other than the Selected Reserve. Other people eligible for VA loans Individuals who have completed service with certain federal government organizations also can be eligible for VA loans. Examples include cadets at the U.S. Military, Air Force or Coast Guard Academy, midshipmen at the U.S. Naval Academy, World War II merchant seamen, U.S. Public Health Service officers and National Oceanic & Atmospheric Administration officers.

1606 S Ashland Ave Unit C-1, Chicago, IL 60608 4,675 SF of Retail Space Available Space: 4,675 SF Year Built: 2023 Sprinkler System: Fire Extinguisher/s, Smoke or Fire Protectors, Sprinklers-Wet, Stand Pipe, Carbon Monoxide Detector(s) Air Conditioning: Central Air Electricity: Circuit Breakers, Separate Meters, 201-600 Construction: Brick Foundation: Concrete Zoning: C1-2, Chicago Stunning Pilsen condo-quality new construction, available September 1st! 1622sq of modern, spacious, and bright 3BD/2BA with 1 garage spot included. Unit features 11' ceilings, 9' doors, oversized floor to ceiling windows, central air and heat, custom lighting, vinyl luxury plank floors throughout, wide open kitchen/ living/ dining space, modern kitchen cabinets, quartz countertop, GE ss appliances, contemporary bathroom tiles and fixtures, vast number of closets and private balcony. 2nd bedroom with large full bath presenting free standing tub, shower, and double vanities. In unit full size site by site washer & dryer. Application fee is $50 per adult applicant. Non-refundable move-in fee is $350 per adult tenant. Non-refundable pet fee is $350. 1 pet per unit under 35lbs allowed. Tenant pays heat/ cooking gas and electric. No security deposit. Minimum credit score requirement - 750. 1 year lease minimum. The building is within walking distance of Pink Line, great restaurants, convenience stores, art galleries, boutique shops, park and many more. Quick access to expressway, Medical District and UIC. DESCRIPTION 1606 S Ashland Ave, Chicago, IL 60608 Residential Units Available Units: 24 Floors: 8 units on each floor (2nd, 3rd, 4th) Pricing: 2nd Floor Units: $3,000/mo 3rd Floor Units: $3,200/mo 4th Floor Units: $3,400/mo Request More Information on 1606 S Ashland Ave Unit C-1 First Name Last Name Email Phone Write a message Submit Thanks for submitting!