What is the difference between mortgage pre-qualification and pre-approval?

• Pre-approval is a formal commitment where we verify your actual income, credit, and assets.

How does my credit score affect my mortgage rate?

• Higher credit scores qualify for significantly lower interest rates.
• A small score increase can save you thousands over the life of your loan.

What is Private Mortgage Insurance (PMI)?

• PMI is a fee or an insurance policy if your down payment is less than 20% on a conventional loan.
• It protects the lender but allows you to buy a home sooner with less cash down.
• You can request PMI to be removed after 24 months if your market value has increased

Can I get a mortgage if I am self-employed?

• Yes. You typically need two years of tax returns and profit/loss statements.
• We specialize in boutique service for business owners to ensure income is calculated fairly.

What is a Debt-to-Income (DTI) ratio?

• DTI compares your monthly debt payments to your gross monthly income as a percentage
• Most lenders look for a total DTI ratio below 43%. That is your new home payment plus your minimum monthly payments as listed on your credit report divided by your gross monthly income. For example, gross $10,000 monthly income, housing payment with all taxes and insurance $3200 plus minimum payments as listed on the credit report, $800 = 3200 + 800 = 4000/10,000 = 40% DTI (debt to income) ratio.

What is an escrow account?

• It is a holding account where a portion of your monthly payment is set aside.
• This ensures your property taxes and insurance are paid automatically on your behalf by the lender

What is the difference between a fixed-rate and an adjustable-rate mortgage (ARM)?

• A fixed-rate mortgage keeps the same interest rate for the life of the loan.
• An ARM has a rate that can change periodically after an initial fixed period.

What are mortgage points or discount points?

• You can buy a home with as little as 3% down for conventional loans or 3.5% for FHA. Many Illinois buyers also qualify for IHDA (Illinois Housing Development Authority) down payment assistance programs.

How do I get pre-approved for a Chicago mortgage?

• You’ll need to provide your last two years of W-2s, recent pay stubs, and bank statements. At Egan, we provide rapid pre-approvals so you can make competitive offers in the fast-moving Chicago market.

What are closing costs like in Chicago?

• Expect closing costs to be between 2% and 5% of the purchase price. This includes lender fees, title insurance, and Chicago-specific transfer taxes.

Does Egan Financial Group offer FHA or VA loans?

• Yes. We provide a full suite of products including FHA (low down payment), VA (for veterans), and Conventional loans, all handled with our personal boutique service.

How do interest rates in Chicago compare to the national average?

• Rates follow national trends, but Egan Financial Group often beats “Big Box” rates.
• We do this by eliminating corporate middle management costs and passing savings to you.

What should I know about Chicago’s neighborhood-specific incentives?

• Some areas offer specific tax incentives or TIF district benefits. We can help you identify if your chosen neighborhood has unique financial advantages.