First-time buyers
You are allowed to not know any of this yet.
First-generation and first-time buyers are the core of our work. This page is the honest version of what you need to work out, in the order you need to work it out.
Before you look at a single house
Four things to sort out first.
Work out what you can actually afford
Not the maximum a lender will approve — the monthly payment you can live with once taxes, insurance and maintenance are in it. Those three are the part people forget, and in Illinois the property tax line is rarely small.
Look at your credit early
You can check it for free, and small things can often be fixed in a few months. Finding out now is much better than finding out during underwriting.
Understand the down payment is negotiable
Twenty percent is a myth as a requirement. FHA loans and other low-down-payment programs exist precisely for first-time buyers, and Illinois and the City of Chicago both run assistance programs. Eligibility changes year to year, so ask what currently applies to you rather than trusting a blog post.
Get pre-approved in writing
A pre-approval letter is what turns you from a browser into a buyer. Until you have one, most sellers in these neighborhoods will not take an offer seriously.
The words nobody explains
A short glossary, without the condescension.
Earnest money
A deposit you put down when your offer is accepted, to show you are serious. It is credited toward your purchase at closing. It is not an extra cost, and it is refundable in the circumstances your contract specifies.
Attorney review
Illinois is an attorney state. After an offer is accepted, both sides' attorneys review and can modify the contract within a period written into it. This is normal, and it protects you.
Contingency
A condition that has to be met or you can withdraw without losing your deposit — typically financing, inspection and appraisal. Waiving one makes your offer stronger and your position weaker.
Closing costs
Lender fees, title charges, transfer taxes and prepaid items, due at closing on top of your down payment. Your lender must give you written estimates — read them, and ask about anything you don't recognize.
FHA loan
A mortgage insured by the Federal Housing Administration, with lower down payment and credit requirements than a conventional loan. It comes with mortgage insurance. It is a common route for first-time buyers here, and your lender confirms whether you qualify.
Appraisal
Your lender's independent valuation of the property. If it comes in below the agreed price, the gap has to be solved — renegotiated, covered, or the deal ends. It is not a reflection on you.
Doing this in Spanish
Realproz runs home-buying seminars in Spanish and works through the entire purchase — showings, offers, attorney review, closing — in whichever language you prefer. We can also introduce you to lenders and attorneys who work bilingually, so you are not the only person in the room translating for yourself.
Nothing in this process should have to be explained to you twice because the first explanation was in the wrong language.
Ask the question you think is too basic.
It almost certainly isn't, and it is much cheaper to ask it now than after you've signed something.