Jan McNulty

LICENSE: 471.003892

(847) 274-0535
(847) 495-5000 (Office)

Real Estate Tips

Are you ready to switch from Renter to Homeowner? Here are 8 signs that you maybe ready:


1. You’re tired of rising rent prices.
Rental prices are on the rise nationwide, according to Apartment Guide, which tracks trends in the rental market.Rising rent makes it harder to budget for monthly housing costs and to save for other financial goals. When paying rent begins to feel like a bad investment and you want to build equity for the future.Many renters are ready to buy a home once they are financially stable. Many are motivated by the pride of ownership and wanting more control over their dwelling place.


2. Your credit score has improved.
Some renters are locked out of homeownership because they can’t qualify for a mortgage. Before you apply for a mortgage, get a free copy of your credit report.

If you have some false information, I know lenders that will plead your case.


3. You’re good at managing debt.
Another thing lenders look at when screening mortgage applicants is their debt-to-income ratio, or DTI. This is a key metric that’s calculated by adding up all monthly debts, then dividing the sum by your gross monthly income. The higher your DTI ratio, the more risk you pose to a lender. Keeping credit card balances below 30% of available credit limit has a positive influence on your credit score.


4. You have enough set aside for the extra costs of owning a home.
Buying a used home almost requires that you set aside money for the little surprises in a home. Furnace needs a new thermostat, the shut off valve on the toilet is leaking, the spray on the kitchen faucet doesn’t work. Not planned these little things can add up. I recommend a home warranty to help defray the cost of repair and replacement of things in the home.


5. You can afford the down payment and closing costs.

The down payment requirement depends on the type of home loan you get. For conventional loans, 20 percent down is usually required if you want to avoid paying private mortgage insurance, or PMI. Some mortgages insured by the Federal Housing Administration, known as FHA loans, require just 3.5 percent down. Fannie Mae and Freddie Mac back some mortgage products that require just 3 percent down; and loans guaranteed by the U.S. Department of Veterans Affairs and the U.S. Department of Agriculture (USDA) require no down payment.

Renters interested in buying a home should compare different loan programs to see which one is best for them. In addition, there are village and city grants and programs to help homebuyers with down payments.

Another expense you have to be ready for is the closing costs, which typically equal 2 percent of the property’s sale price. The good news is that some closing costs are negotiable.

6. You’re ready to settle down in one place.
Buying a home involves a lot of upfront costs that can take a few years to recoup, so if you anticipate moving before you can recover those costs, homeownership might not be right for you.

7. You’re going through a major life change.
Marriage, a growing family, a new job and children leaving the nest are catalysts for people to buy a home.

8. You know what you want.
It’s smart to have a good idea of the area or neighborhood you want to live in and the type of home you want before you begin your quest. Houses, townhouses, condos, co-ops, duplexes—there are lots of options out there and each one has its own considerations for costs, upkeep and personal enjoyment.


Ready to Leave Renting Behind? Here’s What to Do Next
Give me a call, and I’ll give you the right direction. Is a fixed rate best or is an adjustable rate best? What lenders would I recommend based on personal experience or the experiences my other buyers felt? What suburbs are you thinking works best for work, and family or the children’s needs.


I’m ready to help! Give me a call at 847-274-0535.