You’ve been looking for an opportunity to help more first time buyers get into a house.  This is it!  Last week,  Minnesota Housing joined forces with Fanniemae and launched this new program.  Here are the highlights!

• 97% Loan to Value so 3% down
• 30 year fixed rate
• No mortgage insurance!

It comes with a very favorable interest rate and you can monitor that daily at http://www.mnhousing.gov/consumers/rates/index.aspx

This is a great affordability tool as the absence of monthly mortgage insurance means the payment will be lower and/or the buyer can qualify for more home with a lower payment.  There are income restrictions, as with all first time buyer programs, but this one comes with the generous Minnesota Mortgage Program guidelines. Read the rest of this entry »

In a variety of forms, this question came up this week.  There are a lot of myths circulating on the subject.  Farm or hobby farm?  Lake Home or Cabin?  Fixer upper that is Habitable or not considered Habitable in its current state.

 Years ago, I was doing a mortgage on a hobby farm of 40 acres.  The property was beautiful with a newer house set back on a hill with a long and winding gravel road up to the house.  My kind of place.  The appraiser took some great photos of the property.  The underwriter, who lived in Chicago required a little coaching on the subject of farm vs hobby farm as you need to drive quite a ways out of Chicago land to find what we in Minnesota find within commuting distance.  She did approve the loan but commented on the just how ugly the family dog was that the appraiser had snapped in one of the photos.  City Slicker.  It was a baby goat.  Read the rest of this entry »

“The misconception is that because Social Media marketing is so tangible, it’s also easy.  The fact is that it can become one of the most time consuming distractions of your business plan.  And what you’re doing may not even be the most effective method to achieve the desired results.” I paraphrased a little but so says Jorgy Jorgensen who is the Owner of Local Likes-A Social Media Company, when we sat down to discuss the subject a couple of weeks ago.  Read the rest of this entry »

We had a borrower who changed jobs and didn’t tell us until we discovered it a couple of days before closing.  A couple who applied on line and didn’t tell us they were expecting a child prior to closing that would eliminate one of the incomes that we relied upon for approval.  A final credit report was pulled 24 hours before closing and a credit card with a small balance at application now had a large balance.   Fortunately, we were able to fix all of these situations but anyone of them could have derailed the closing permanently. Read the rest of this entry »

In my search for a good financial planner years ago, a friend of mine gave me some sage advice.  She said that one of her criteria for deciding who she’d use was based on a simple premise.  “You show me yours and I’ll show you mine.”  What she meant to say was that she wasn’t going to trust her financial future to someone without the experience or know how to get her to the finish line safely and successfully.

Serial Refinancing is a bad idea

I had the pleasure of a visit from Dan Mitchell of the Commerce Department last week.  We went through a standard audit.  During the exit interview, it was suggested that we ask our borrowers to write down their reasons for wanting to refinance.  I agree.  Many people are enamored of the low rates available today and are rushing the doors of mortgage companies to refinance.  There are all kinds of cheesy advertisements on the radio and my mailbox is inundated with offers on a weekly basis. Read the rest of this entry »

For FHA case numbers issued on or after April 9^th, the new mortgage insurance premiums take effect.  By the time you receive this, time will have virtually run out to take advantage of the old rates.Today is the last day to get one and you must have a fully executed purchase agreement for that.

 Beginning Monday, the new MIP on a 30 year FHA loan will be 1.75% in upfront premium and 1.25% for the annual amount.  For those borrowers with excellent credit and 5% of their own money for the down payment, it’s worth comparing the mortgage insurance on a conventional loan with an FHA loan.  Read the rest of this entry »

This week, a young couple, who had immigrated to this country a few years ago, closed on their new home. They had given up a great deal to come and live here. The educational credentials they had in their homeland didn’t transfer to the US and in possession of limited English language skills when they arrived, they were unable to go back to school to get them. He had been a doctor in his country and in this country, he works as a carpenter. As they signed the final papers they stood up and hugged each other with tears in their eyes. They were very kind people and so very grateful. The thing she was looking forward to the most was to have a place to plant tomatoes in her own yard. I needed the gift of gratitude that these people gave me this week.  Read the rest of this entry »

I probably hear it at least once every day.  “Kate, we’ve looked at everything that’s available and it’s all junk.  All of the good houses are getting multiple offers and are gone before we can even put pen to paper. “

 We are seeing more and more people make the choice to buy a house, tear it down and build new.  Edina and Minneapolis are certainly hot spots for this activity.

However,  the practice is gaining momentum all over the Metro area. 

So just how do you finance such a project?  It’s as simple as 1-2-3. Read the rest of this entry »

Normally on a Friday, I wake up at the lake and work from our porch overlooking the water.  We needed all hands on deck at the office today so I drove into Bloomington to lend a hand.   As I was driving in, the sun was this huge, perfectly circular blaze orange-red orb in the sky straight ahead.  Maybe you saw it too.    Then I recalled this incantation that I’ve heard from childhood and wondered if storm clouds were gathering.  Read the rest of this entry »

It’s been a while since the New Construction market was this red hot!  With the Spring Parade of Homes in full swing, discerning clients are weighing the cost of building new vs trying to make someone else’s dream theirs. Over the past two months nearly 50% of our team’s loan volume has been for new homes.   The competition is on for developed lots and land and the rock bottom prices of the past many years have stabilized and started to climb.  We are just coming out of the winter and holiday months where distressed property sales have dominated the markets for the past several years.  The combination of these two things is setting up an increased possibility for a low appraisal on a new construction project.  Read the rest of this entry »

In a press release Monday, HUD announced some changes that will impact FHA loans where Case Numbers(obtained as soon as we have a fully executed purchase agreement and an application) are assigned on or after April 1, 2012.

“Washington-As part of ongoing efforts to encourage the return of private capital in the residential mortgage market and strengthen the Federal Housing Administration’s (FHA)Mutual Mortgage Insurance Fund, Acting FHA Commissioner Carol Galante today announced a new premium structure for FHA-insured single family mortgage loans. FHA will increase its annual mortgage insurance premium(MIP) by .10 percent for loans under $625,000 and by .35% for loans above that amount. Upfront premiums(UFMIP) will also increase by .75%.” Read the rest of this entry »

It’s that time of year again when we dig out all of our receipts, W-2’s etc and sit down for a date with Turbo Tax or our accountant to find out whether we will give or receive.  I devoted the better part of last weekend to filing out ours and my mother’s tax returns. 

The offices of the IRS get slammed with incoming this time of year and depending on how you file your taxes, it may take a mere few minutes or weeks for the IRS to acknowledge receipt.

This sets up a time trap for us in the mortgage business as we are now required to get IRS tax transcripts on all borrowers for the most recent two years.  If the borrowers are using the proceeds of a refund for their down payment, that will necessitate getting them for this year.  If not, then we can still use the transcripts for 2009 and 2010 to satisfy the requirement as long as they close prior to April 17^th.  For anyone closing at the end of April, we will need to get those tax transcripts for 2011.   If you file electronically it’s possible to get them in a matter of days but if filed by snail mail, then it can take up to two or more weeks for the IRS to acknowledge receipt.  Then it will take additional time for them to review and make available tax transcripts.  This could delay a closing as there is no way around this particular requirement.  So if you’re working with a buyer who wants to close in the next 60 days, you may want to ask if they’ve done their taxes yet! Read the rest of this entry »

 We all know that it’s important to get the buyer pre-approved but it’s equally important to make sure that the property will pass muster.  The purchase agreement becomes the strategic document that Realtors, sellers and buyers negotiate to insure a successful closing.  While failed financing often gets listed as the reason when a sale falls apart, if you take a closer look, the actual reason is often written or, perhaps more to the point, not written into the purchase agreement from the start. Read the rest of this entry »

A couple of years ago, on a layover coming back from Australia, I met a couple with a very interesting retirement philosophy.  They were in their early 50’s, had sold everything and were traveling the world with what they could carry in their backpacks.  They had climbed Kilimanjaro, hung out on a sheep station in Australia for a month, snorkeled on the Great Barrier Reef and planned to continue their world trek until they turned 60.  Their retirement would last precisely one decade.  Then, they were going back to work and planned to work until they died, if at all possible.  At 50, they were in excellent physical health could hike and get to places that would not be accessible to them as they aged, and they could better tolerate the deprivations required by seeing the world on a shoestring budget.  The crash of the real estate markets and double pull backs in the stock market of the last decade will have many Boomers rethinking their retirement strategies, but which way will they go?  Read the rest of this entry »

The uptick in activity for the month of January was nothing short of astounding.  Application volume was 600% higher than in a normal January.  Some of it is undoubtedly related to ‘the winter that wasn’t.’   Yet, there has been a definite shift in the mood of the folks that have been in to see us in recent weeks.  The belief is that we’ve moved away from the edge.   All of the fundamentals are falling in place to get the 6 Million Gen Y and Gen X buyers that are still living with their parents, to flee the nest.  Read the rest of this entry »

I love ‘the street”.  It never fails to tell you what you need to know to help and serve people.  I was talking with an agent this week who told me that she was gearing up to really sell some houses this year but that she had taken a sabbatical for a couple of years.  She  needed to catch up on what was available in today’s distressed real estate environment to finance these properties;  the price range for a lot of first time buyers .  She had a nice young couple who needed to buy an affordable home and everything in their price range seemed to be a foreclosure where the former owners had walked off with the kitchen or a short sale property that needed some serious TLC. She found a property that fit the bill for her FHA buyers but the listing agent told her that they’d only accept an offer if it was an FHA rehab loan since there would undoubtedly be work orders.  She was referred to me because this top REO agent knows that we do these all of the time and very well. Read the rest of this entry »

Yet this year’s presidential election may have a very strong influence on our spring real estate market.  According to Mitch Kider, Managing Partner for the Washington law firm, Weiner, Brodsky, Sidman and Kider, “2012 may be the toughest year ever from a regulatory perspective.”  Right and tight is the mantra that will keep the lending community in good standing with Wall Street investors and regulators alike.  As each side tries to prove its case in this ‘super charged’ political arena, expect one of the focal points of the debates to be what is the cause and cure for what ails the real estate market. Read the rest of this entry »

Those of us in sales are challenged in today’s environment to build a case that passes the “So What?” test and the mode of message delivery is very  different depending on the generation of our audience.  According to Terri Sjodin, author of Small Message, Big Impact, most of us are still delivering our message like we did in the days of bell bottoms, polyester pants and platform shoes and “the 70’s called and wants their presentation back!” Read the rest of this entry »

2012 is shaping up to be an UNusual year and the prognosticators are out in full force with the usual blood and guts headlines about falling home prices and foreclosure activity. I say we skip those and in the tradition of Pollyanna  see what we can conjure up with a round of “The Glad Game.  The game consists of finding something to be glad about in every situation. It originated in an incident one Christmas when Pollyanna, who was hoping for a doll in the missionary barrel, found only a pair of crutches inside. Making the game up on the spot, Pollyanna’s father taught her to look at the good side of things—in this case, to be glad about the crutches because “we didn’t need to use them!”-Wikipedia Read the rest of this entry »

“Go placidly amidst the noise and haste and remember what peace there may be in silence…”-Desiderata

Ever just want to press the pause button? 

As the year comes to a close, the greatest present we could all give ourselves is a little time away from the harried pace we live with day to day; time to carve out a plan for our lives that allows us to savor that which is truly important and to discard that which isn’t.

My encouragement to you would be to make the time, to take the time, before your life is simply spent. Read the rest of this entry »

 Someone recently commented to me that some 19% of all real estate transactions are falling apart during the approval process never to get to the closing table.  Ouch! Read the rest of this entry »

The Federal Housing Finance Agency, which regulates the activities of Fanniemae and Freddiemac, announced this week that they would make refinances possible for many more millions of people who are substantially underwater on their mortgages.  The devil is in the details which are not very well defined just yet.   Read the rest of this entry »

I know you want your customers to be happy but are your customers purposefully at the top of your Org Chart? 

Our stated business goal is to exceed our customer’s expectations 100% of the time.  As my boss always says, “you can’t manage what you don’t measure.”  Read the rest of this entry »

Every day I speak to people who have experienced the pain and stress of losing their home. They all have one thing in common; the ‘hope’ of owning their own home again and they want to get there as quickly as possible.
There is a lot of mythology circulating in the street. So, today, I thought it would be helpful to hit the high points of the rules and options as they exist today. Read the rest of this entry »

I keep hearing this guy on the radio say something to the effect that ‘with rates this low refinancing is the biggest no brainer in the history of mankind.’

Turn that to purchasing a home and the same should be true.  With rates at 60 year lows, why aren’t people stampeding Real Estate offices right now to purchase homes?  The Feds announced Wednesday  that they are going to try a new trick to stimulate the economy aptly named Operation Twist. Read the rest of this entry »