Archive for February, 2014

Quick Reference Guide of minimum seasoning and waiting requirements- By Barb Crea

February 28th, 2014

Over the past couple of weeks we’ve been talking about “being ready” – ready for buyers! One category of buyers to be ready for are those who have experienced some sort of financial distress, like losing their home. They’ve been sitting on the sidelines waiting for their opportunity to get back into the housing market. Let’s be ready to help them back into homeownership. Most derogatory events fall into two categories: Extenuating Circumstances or Financial Mismanagement. While every situation may be different, and extenuating circumstances such as a serious illness or death of a wage earner may apply, most situations fall under Financial Mismanagement. Below is a Quick Reference Guide of minimum seasoning and waiting requirements:


Conventional – 84 months (7 years) seasoning from transaction completion date regardless of reason

FHA – 3 years from the completion date of the foreclosure to the borrower’s FHA loan application date

VA – 3 years from the completion date of the foreclosure is required by most investors. If the foreclosure was on a VA loan, the applicant may not have full entitlement available for the new loan.

DEED-IN-LIEU OF FORECLOSURE: Deed to the real property is transferred back to the servicer.

Conventional – waiting period: 2 years with minimum 20% down; 4 years with minimum 10% down; 7 years standard guidelines with minimum 5% down.

FHA – 3 years from the completion of the deed-in-lieu to the borrower’s FHA loan application date

VA – 2 years from the completion of the deed-in-lieu when the borrower was NOT delinquent at time of transfer. 3 years when the borrower WAS delinquent at time of transfer.

SHORT SALE OR PRE-FORECLOSURE SALE: Previously owned property was sold for less than what was owed.

Conventional – waiting period: 2 years with minimum 20% down; 4 years with minimum 10% down; 7 years standard guidelines with minimum 5% down.

FHA – 3 years if borrowers were in default at the time of short sale (or pre-foreclosure sale). Borrowers who sold their property under the FHA pre-foreclosure sale program are not eligible for 3 years from the date that FHA paid the claim associated with the pre-foreclosure sale.

VA – 2 years if borrowers were NOT delinquent at time of short sale (or pre-foreclosure sale). 3 years if the borrower WAS delinquent at time of sale.

MODIFIED OR RESTRUCTURED MORTGAGE ON CURRENT HOME: Terms of the original transaction have been changed, resulting in absolute forgiveness or a restructure of the debt.

Conventional – at least 4 years and up to 7 years must have elapsed since the completion of the modification. Minimum 10% down payment required.

FHA – standard 12 month mortgage payment history guidelines apply – 0x30 late payments in the last 12 months

VA – standard VA guidelines apply Read the rest of this entry »

Minnesota Housing Finance Agency is much more than just mortgage programs and down payment assistance for home buyers. -By Randy Cullen

February 21st, 2014

Thursday afternoon our branch hosted a training event with Minnesota Housing Finance Agency (MHFA) for a large group of Realtors, Builders, and affinity partners. The focus of the training was to showcase all the positive changes in products and programs available through MHFA for First Time Homebuyers and also Non First Time Homebuyers. I was amazed at the turnout in the midst of the winter storm that gave our metro area another 10 inches of snow. We Minnesota folks are tough!

MHFA has upgraded their product and program offering to meet the very changing needs of the housing market. First time buyers have historically benefited from below market interest rates and resources to help with down payment and closing costs. Similar help and assistant is now offered to Non First Time Buyers who wish to purchase a home. A Mortgage Credit Certificate program is now available, and a refinance product has also been introduced, for qualified homeowners. There is a complete listing of First Time Buyer products and programs available on our website, so follow the link to learn more.

MHFA studies housing markets and trends so they can determine where to apply their resources. We all do the same when we are preparing our family budgets – they just do it on a much larger scale. MHFA allocates resources for their mortgage programs and down payment loans after extensive research of historical data and future projections. They share their work with all of us so the Realtor and Builder communities will understand their focus and how the products and programs for home financing are developed. Interesting fact – with median home prices in our area hovering around $200,000, 70% of the MLS listings in our metro area are eligible for MFHA programs. Here are a few additional things I learned: Read the rest of this entry »

2014 is expected to be a phenomenal year! -By Barb Crea

February 14th, 2014

2014 is expected to be a phenomenal year, but it seems to be starting out slow and some feel it’s due to a lack of inventory. So, we can just sit there and wait for inventory to increase, OR we can get out there and make it happen – the choice is yours. Steve Harney of Keeping Current Matters (KCM) says the quickest way to dominate this year is to make sure you have plenty of inventory available, priced right.

In KCM’s February Monthly Market Report there are a couple of slides that would be a great addition to your “Pre-Listing Package” or would make a great postcard to mail out. KCM also has Buyer & Seller Guides that are updated quarterly that can be printed to drop off to a FSBO or an expired listing. You could email the Seller Guide to all your past CMA’s over the last year. You probably have the e-mail addresses of all those people in your database. Send them this book because now is the time people are starting to think about selling. Contact me at (952) 851-8992 or if you would like a copy of the current Buyer & Seller Guides or any of the slides from the Monthly Market Report, or click on to start a free trial to Keeping Current Matters. It’s a great resource that can give you a competitive advantage in knowledge.

COST OF WAITING:  While homeowners are waiting for property values to come back, they’re not looking at the whole picture and not understanding the “cost of waiting”. KCM has a colorful slide comparing the average price and interest rate in December 2012 to December 2013, illustrating a $228.35 difference in monthly payment. Buyers and sellers that waited are now paying $2,740.20 a year more than if they had purchased a year ago – over thirty years that’s $82,206. Another slide, using Freddie Mac’s numbers and projections on interest rates and a 4% increase in home prices, shows if buyers and sellers wait another year they’ll pay an additional $202.52 a month in mortgage payments – adding up to $2,430.24 a year or $72,907.20 over 30 years. The Fed is still giving buyers the opportunity to borrow money at a discount – BUT for how much longer?  Let me know if you’d like a copy of these two slides for YOUR presentation booklets and packages.

According to a 2014 Lending Tree Survey on Consumer Views on Housing & Economy, 71% said they are considering selling their home in 2014; and the great majority of those potential sellers are under 30 years old. When they purchased their current home, in many cases, they settled for a smaller house than they wanted. Maybe they jumped into a townhouse or condo because it was less expensive. This group of people are the millennials, and based on these numbers are going to have a huge impact on the market going forward.

10, 10, 20 CONCEPT Read the rest of this entry »

The Rush Begins- By Randy Cullen

February 7th, 2014

Looking at the 10 day forecast I see that we have at least one 20 degree day in our future and night time temperatures will be above zero. We have turned the corner from losing to gaining daylight every day. It has been a long, cold winter and I think everyone is suffering from a little cabin fever. Buyers should be emerging from their long winter’s nap to find the general housing outlook has improved and rates are staying low for now. Here are few things I found interesting about the market and potential buyers.

Per the Minneapolis Association of Realtors market report, , home prices for the 12 month period ending January 2014 are on the rise, with the median sales price up 14.9% over this period. The outlook from Kiplinger,, is also predicting home prices will head higher. This lift in price can be seen as a benefit for both buyers and sellers. The improvement in home values has reduced the number of households who are underwater on their mortgages. This will have a big impact on the market as homeowners feel confident to be mobile again, knowing that selling their current home is now possible. This will increase housing inventories and offer more choices for buyers.  Read the rest of this entry »