Chicago jumbo financing · Step by step
Buying a $1.5 Million or Higher-Priced Home in Lincoln Park or Winnetka: Jumbo Financing Step by Step
Short answer: Buying a home priced at $1.5 million or more in Lincoln Park or Winnetka may require a jumbo loan, depending on your down payment and loan amount. A jumbo loan exceeds the applicable conforming loan limit.
The process involves five steps: choosing a down payment, documenting income and reserves, reviewing the property, estimating taxes and closing costs, and coordinating the closing timeline. Having your income, assets, and credit reviewed before making an offer may help identify financing questions early.
Step 1: How much should I put down?
Jumbo down payment requirements vary by loan amount, property type, credit profile, and program. Larger loans may require a larger down payment or additional reserves.
Compare down payment options before committing funds. On a $1.8 million Lincoln Park purchase, a larger down payment may move the loan into a different financing tier, potentially affecting pricing or qualification requirements.
Kyle reviews current program requirements for your situation.
Step 2: What documentation may be required?
Depending on your income and program, an underwriter may request:
- Tax returns, including schedules and Schedule K-1 forms reporting income from partnerships, corporations, or trusts.
- Documentation of bonuses, commissions, or restricted stock units.
- Bank and investment statements, plus documentation explaining large deposits.
- Evidence of reserves, meaning eligible assets remaining after closing.
Reserve requirements vary and may be measured in months of housing expenses, including principal, interest, property taxes, insurance, and applicable association dues. Eligible retirement and investment accounts may count at a reduced value.
Review reserves before choosing your down payment.
Step 3: How does the property affect financing?
Lincoln Park: Single-family homes, condominiums, and cooperative properties may have different financing requirements. Condominiums may require a review of the building's financial condition, insurance, and other eligibility factors. Cooperative financing availability varies by program.
Winnetka: Distinctive homes, larger lots, or properties with limited comparable sales may require additional appraisal review.
For either market, discuss renovations early. Financing options may depend on the property's condition and the scope of work. Historic designation or local permitting requirements may also affect renovation plans.
Step 4: How do taxes and closing costs affect the budget?
Property taxes, insurance, and applicable association dues affect both your monthly budget and mortgage qualification.
For new construction or substantially renovated homes, the current tax bill may not reflect the property's future assessment. Request an estimate before setting your price ceiling.
Transfer taxes and other closing costs vary by location and transaction. Review your Loan Estimate with your lender and discuss tax prorations with your attorney. Actual costs may differ from initial estimates.
Step 5: What does the closing timeline involve?
- Before making an offer: Have your income, assets, and credit reviewed. Pre-approval remains subject to applicable conditions and final underwriting approval.
- Contract review: Coordinate attorney review, financing deadlines, and tax prorations with your real estate agent and attorney. Deadlines depend on the contract.
- Appraisal: Coordinate the appraisal with your lender. Additional valuations or property reviews may affect timing.
- Final approval and closing: Updated documents, reserve verification, and title review may be required. If proceeds from another home sale will fund the purchase, discuss that dependency early.
Frequently Asked Questions
Does the same conforming loan limit apply in Lincoln Park and Winnetka?
Both are in Cook County. For the same property unit count and applicable year, the same county conforming loan limit applies. Whether jumbo financing is needed depends on the loan amount.
May bonuses and restricted stock units count as income?
They may qualify if they meet the program's documentation, history, and continuance requirements. The qualifying amount may differ from your current compensation.
Do jumbo loans require private mortgage insurance?
Some jumbo programs may offer financing without separate private mortgage insurance. Down payment, reserve, and other requirements vary by program.
May I purchase with cash and obtain a mortgage afterward?
Delayed financing may be available through certain programs, subject to eligibility, documentation, timing, and loan limits. Discuss the requirements before purchasing.
Applicant subject to credit and underwriting approval. Not all applicants will be approved for financing. Receipt of application does not represent an approval for financing or interest rate guarantee.
Refinancing your mortgage may increase costs over the term of your loan. Restrictions may apply, contact OriginPoint for current rates and for more information.
OriginPoint, LLC. NMLS #: 2185899. 1800 W Larchmont Ave, Suite 305, Chicago, IL 60613. 855-997-6468. For licensing information, visit nmlsconsumeraccess.org. Equal Housing Lender. Conditions may apply.
Kyle reviews your income, reserves, and target property before you write an offer, and tells you which loan-size tier you land in and what the file needs to clear.
Kyle Gillespie · SVP of Mortgage Lending · OriginPoint (a Rate company) · NMLS #223778
(773) 435-7939 · 1800 W Larchmont Ave, Suite 305, Chicago, IL 60613
More: KyleGillespie.com · Verify licensing: nmlsconsumeraccess.org
Sources
- Federal Housing Finance Agency. Conforming Loan Limit Values
- Fannie Mae. Selling Guide
- Consumer Financial Protection Bureau. Loan Estimate Explainer
- Consumer Financial Protection Bureau. Closing Disclosure Explainer
- Cook County Assessor's Office. Cook County Assessor
- Cook County Treasurer's Office. Cook County Treasurer
- Cook County Clerk's Office. Cook County Clerk
Information provided is for educational purposes only. It should not be construed as financial or legal advice or instruction. OriginPoint does not guarantee or assume liability for the accuracy, completeness or timelines of the information. You should conduct additional research before making any mortgage related decisions.
All information provided in this publication is for informational and educational purposes only, and in no way is any of the content contained herein to be construed as financial, investment, or legal advice or instruction. OriginPoint does not guarantee the quality, accuracy, completeness or timelines of the information in this publication. While efforts are made to verify the information provided, the information should not be assumed to be error-free. Some information in the publication may have been provided by third parties and has not necessarily been verified by OriginPoint. OriginPoint its affiliates and subsidiaries do not assume any liability for the information contained herein, be it direct, indirect, consequential, special, or exemplary, or other damages whatsoever and howsoever caused, arising out of or in connection with the use of this publication or in reliance on the information, including any personal or pecuniary loss, whether the action is in contract, tort (including negligence) or other tortious action. Applicant subject to credit and underwriting approval. Not all applicants will be approved for financing. Receipt of application does not represent an approval for financing or interest rate guarantee. Refinancing your mortgage may increase costs over the term of your loan. Restrictions may apply.
No mortgage loan applications for properties located in New York will be accepted through this site. This site is informational and educational only and is not financial, investment, or legal advice, nor a commitment to lend.
OriginPoint LLC, NMLS #2185899. Operating in the state of California as OriginPoint Mortgage LLC in lieu of the legal name OriginPoint LLC. For licensing information visit www.nmlsconsumeraccess.org.