A Deeper Examination of Schools Near Your Next Minnesota Home

We highly value the feedback we get on how we can improve your home search tool, the Home Scouting Report®.  Over time, your recommendations have led to many additions (all available by clicking on our ugly mugs after you’ve logged in).  Now, we’ve added another interactive research tool; The Minnesota Report Card from the Minnesota Department of Education. While you’ve always been able to get basic school information via the Map View of your Home Scouting Report® but with this new tool, you’ll have access to these additional resources: My School – Demographics, trend data, graduation rates, contact information and …

Long Term Mortgage Rate Forecast Going Into Winter Market

As the winter weather hits or threatens to hit, many people who have actively or passively been searching for a home ask, “Should I just postpone the idea until spring?”  There are many reasons to either wait or hasten the purchase of a home.  If you happened to be considering mortgage rates as one variable in your decision, we thought that we’d share the one reliable forecasting model that we follow for long term mortgage rate forecasts: Mortgage Rate Forecast for 30 Year Conventional Loan 30 Year Conventional Mortgage Rate. Percent Per Year Average of Month. Month Date Forecast Value …

Top Three Reasons to Feel Good About Buying a Home in the Twin Cities

It doesn’t happen very often where, in a compact period of time, I see a wealth of reliable data released that shed such sunny light on the decision to buy a home in the Twin Cities but lately that has been the case.  If you’ve been contemplating such a decision, here are 3 great reasons to feel good about your decision and its timing in ascending order. Reason 3: CNBC Ranks Minnesota as a Top State for Business. CNBC’s announcement may seem boring, and it definitely is, but from the perspective of a homebuyer or homeowner, it’s critical.  This is …

Fannie Mae Increases Down Payments on MyCommunity® and Standard Loans

In another backward-thinking move, Fannie Mae has very subtly announced that they will be increasing their down payment requirements by decreasing their maximum Loan to Value Ratios for MyCommunity® mortgages and for standard mortgages on 1-unit primary residences effective on or after the weekend of November 16, 2013.  The previous allowed down payments were at 3% based on a Loan to Value Ratio (LTV) of 97%. The difference between 95% LTV and 97% LTV financing may sound slight but on a macroeconomic level, it’s huge.  It will postpone purchases for multitudes of buyers; particularly first time homebuyers who might find …

Buy a Home Now vs. Wait – Who Needs a Forecast for that?

Charles Dailey – Branch Manager, Loan Officer, Certified Military Housing Specialist – CA DOC, MN DOC & WI DFI The Home Buyers Scouting Report® is provided directly to the buyer by HBM II, a licensed national real estate brokerage service company, not to or through a lender. The FREE home finding service is provided directly to prospective homebuyers by HBM II and its real estate brokers, as part of their ordinary real estate brokerage services. HBM II, Inc. works cooperatively with other real estate agents across the United States in attempting to find ready, willing and able buyers for homes …

Understanding Agency Relationships in Real Estate

Would you hire your spouse’s Attorney in a divorce battle, or if someone brought a law suit against you would you hire the opposing side’s attorney, hell no! Then why do Home Buyers and Sellers hire Real Estate Firms without understanding the concept of “Agency?” (Who Represents Whom In Real Estate Transactions) Buying and Selling properties are usually the largest and most important financial decisions most of us make during our life times. Buyers and sellers can be at a distinct disadvantage not understanding the concept “Agency” during a Real Estate transaction. For most of us, we don’t really care …

Know Someone Who Needs Assistance With their Mortgage Due to Unemployment?

Anyone you know struggling with mortgage payments due to unemployment? Forbearance Terms Eased for Freddie’s Borrowers Freddie Mac gave unemployed homeowners who are struggling to pay mortgages owned or guaranteed by the company a break on Friday when it eased its temporary forbearance restrictions. Effective February 1, Freddie Mac servicers will no longer need prior approval from the government sponsored enterprise (GSE) before extending forbearance of up to six month’s duration to its borrowers who have lost their jobs. Servicers can also seek preapproval for a second six month period of forbearance for those borrowers if needed.Read the entire article from …

Can You Qualify in Today’s Market? Introducing the Professor’s Mortgage Qualification Tool

Reblogged with Permission VIA: http://www.mtgprofessor.com/Qualification/About_the_Qualification_Page.html Posted October 29th, 2011 View the Mortgage Qualification Tool One major difference between the housing finance system today and the system that prevailed prior to the financial crisis is in loan underwriting — the set of rules and procedures governing who is approved for a loan and who is rejected. The swing has been from lady bountiful to Mr. Scrooge. Rules have been tightened across the board. Where the major mistake before the crisis was approving loans to borrowers who should have been rejected, the major mistake today is rejecting loans that should be accepted. …

Why a Home Buyer Should Set Up 3 Search Criteria When Buying a Home

A prospective home buyer or investor might have a clear idea of what he or she wants in the property they’ll buy but the current market brings complexities that make setting up search criteria for this purchase a little more complicated. The difference between bank-owned, short sales and person-to-person transactions bring unique elements to this search process that cannot be dealt with by search criteria alone but that’s where preparation and planning should begin. There are different negotiating tactics, condition of properties and buyer timelines that must be taken into consideration with each of these types of transactions and they …

Buying After a Short Sale is an Excellent Mortgage Credit Risk

While lenders will admit that it’s technically possible to provide mortgages to homebuyers who recently had a short sale without a waiting period, most lenders are not offering this product (for the record, we are offering it).  Because of the complexities of the process involved with closing these loans that creates perceived risk, most lenders elect not to do them and fail to ask the more important question. . .  “Are they a good credit risk?”  The principles of underwriting mortgages and loans in general are outlined in the Four C’s (Credit, Collateral, Character and Capacity).  By these measurements, borrowers …

Compensating Factors: facts and myths

Consumers are becoming more and more educated these days. Some clients even quote me guidelines. I blame myself. After all I’m the one posting these online. Believe it or not, I love educated clients. It makes my job easier. It also means their reading my posts! But for those of you savvy borrowers out there, here’s a list of compensating factors for FHA borrowers whose debt-to-income ratios exceed benchmark recommendations. The borrower has successfully demonstrated the ability to pay housing expenses great than or equal to the proposed monthly housing expenses for the new mortgage over the past 12-24 months. …

What are Compensating Factors When Qualifying for a Mortgage?

Although we wouldn’t know it from watching the six o’clock news, mortgage underwriting guidelines and mortgage insurance underwriting guidelines have been in a pattern of loosening, not tightening.  This trend started in late 2009 and continues today with such examples as lower minimum credit scores for mortgage underwriting guidelines and fewer declining markets for mortgage insurance guidelines.  As this has happened, another trend has emerged.  The phrase “underwriting exception” is coming back in practical contexts rather than a nostalgic reference to days gone by.  These days, underwriting exceptions are more and more common where a mortgage loan file has “Compensating …

Mortgages for Saint Paul, Minnesota Community Land Trusts (CLT) Housing

Community land trusts are created to preserve long-term affordable housing by purchasing homes in their communities, then leasing the land using a long-term ground lease to low-income and moderate-income families at affordable monthly ground rents. Community Land Trusts (CLT) have had a foothold in the Twin Cities for decades. More broadly, the leasehold form of home ownership is more common in Minnesota than many would think. It is a market that Realtors would do well to be skilled in. More especially, it is a market that is crying out for more readily available, quality financing through Fannie Mae. For the …

Buying a Home on a Lease with Option to Purchase – Rent to Own

Since the housing crash and great recession, there have been swelling ranks of people that have had credit damaged but have increased their savings and reduced their consumer debt. Many of these people, in a reasonable time frame will qualify for conventional, VA, FHA, or Rural Development loans but at this time, do not. For those who have their finances situated, saved money and increased their capacity to cover their housing payments, a Lease with Option to Purchase is a great choice. A Lease with Option to Purchase is really two contracts that, by referencing each other in their respective …

Minnesota Home Prices Headed for a Double Dip? – Don’t Believe the Hype

If you’ve been watching the evening news or reading what’s been coming off the press, you might be thinking that the sky is about to fall on Minnesota home prices. You’ll hear a lot of doom and gloom and a lot about the S&P/Case-Shiller Home Price Indices. I assure you that the media will not do an adequate job of explaining what this does and more importantly does not mean to you as a Minnesotan. Since the great recession hit, metropolitan areas have increased in home values 3 percent from their lows. There were 5 major metropolitan areas that bucked …

Wanna Be a Good Mortgage Applicant? . . Then it’s Time to Get Naked!

Qualifying for a Mortgage, we went from one extreme to the next!  3 years ago, if you had a social security number, stated your income and ordered an appraisal (with practically a stated value), you were good to go. Today, when The Mortgage Lady meets with a potential client, one of the opening statements is “we are going to be required to document your documents” and, ask them to not be insulted when the investor has conditions that are beyond what they would expect. We live in a country where our justice says, we are innocent until proven guilty, everyone …

C’Mon Minnesota Legislature, . . Just Ban Deficiency Judgments

In some regards, the MN legislature was ahead of the curve on the mortgage and housing crisis. They regulated non-bank lenders and brokers in ways that other states hadn’t even considered. They got ahead of abusive practices towards distressed homeowners and shady loan modification companies. What they have unequivocally failed at is aiding homeowners who are upside down on their homes. Their greatest impact could be with those contemplating a short sale. Other states have already taken steps. Perhaps the best example would be those taken in California. For some time now, CA has not allowed deficiency judgments in the …

What Does SB931 Mean to Your Seller? . . . It Means That They’re a FHA Buyer!

California has taken, barring the stupidest veto ever, a clever step towards opening doors for homeownership. A primary intention of this bill no doubt was to flush the market of negative equity and aid struggling homeowners. It has an added benefit of streamlining continued homeownership for those who will do a short sale after January 1, 2011 by making a difficult FHA loan approval that much easier to get done. Buying a home after a short sale has been possible through FHA for some time now. While many investors are willing to purchase and securitize these loans, few have been …

Make That Foreclosed Home your Dream Home with an FHA 203k Loan.

You have spent the last 3 months dreaming of buying your new home.  You have been saving for a year for the down payment and you are ready.  You have your dream home in your mind.  You want that 2 story, 3 bedrooms/ 2 bathrooms home that fits the needs of your family.  You want that nice yard for the kids so they can play.  You start working with a Realtor to help you find this new home and you consult with an experienced loan officer to see what you can afford. You are excited because this is going to …