Get pre-approved before you look for your new home. This is the easiest and probably most important thing you can do to help you if you are a Chicago first time home buyer. Pre-approval makes it easy to know how much you can spend, and will therefore help you know what sort of house to look for.

There is no better peace of mind when looking for a home than to have a pre-approval. The best thing about pre-approval is that it doesn’t cost anything and you aren’t obligated in any way. Your local lending institution can give you a written pre-approval with no obligation on your part. Being pre-approved means that you have a guarantee of obtaining a mortgage up to a specified level. Getting pre-approved means money in the bank!

Of course every Chicago 1st time home buyer will have some idea of what kind of monthly payment they can afford. When you are applying for a pre-approved mortgage you will find out how much you can borrow. You won’t necessarily want to go for the maximum amount available to you. Determine what you are comfortable with and then stick to that amount. That will determine the price range of home you should be looking for.

Select the type of mortgage that will best suit you. Not everyone will want the same type of mortgage. When choosing the type of mortgage you want there are several factors you should consider. Ask yourself how long you expect to stay in your new house and how much your current earnings might change in the near future. These things will have a bearing on what kind of mortgage is best suited to your situation.

Payment frequency options can make a big difference to your bottom line. Over the long term using accelerated weekly or bi-weekly payments can save thousands of dollars in interest. Every little bit extra you pay against the principal will reduce the interest you pay. If you use a bi-weekly plan, for example, by the end of the first year you will have actually made 13 payments and the 13th will essentially be put against principal.