Archives
April 2008
Date: Apr. 27, 2008
Tags: Crappie, Panfish, Kissing, Sorority, Leukemia, Sigma Sigma Sigma, Girls, Fundraiser, Lake Minnetonka, Lord Fletchers
Watch as three brave sorority sisters do their part to help out the Leukemia foundation: YOU can visit http://lls.org to learn more about Leukemia and how you can help.
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Date: Apr. 15, 2008
Tags: Downpayment Assistance, Fha Mortgage, Fha Arm, Fha 203k, Fha 203b, Fha Loan, 100 Financing, Nehemiah, Nehemiah Mortgage Program, Minnesota Mortgage Broker
If you want to sell more homes, you NEED to understand mortgage financing and the available options. Besides being a MN real estate broker and selling homes for the past 23 years, I've owned a mortgage brokerage since 1995. I run the mortgage business-Venture Development-with my wife.
Because we are involved daily with the mortgage business, we are able to learn about mortgage programs and then educate buyers and seller on how they work. We are able to recognize more opportunities to get deals done because we know how the mortgage financing options fit into the puzzle. My challenge to you, is to locate a few good mortgage providers-lenders or brokers-and have them teach you about ratios, down payment options, arms, level ratings, credit scores, first time buyer programs, and investment property financing options. The more you learn, the more value you will provide to your buyers and sellers. We all can fill out the listing forms, being the best advisor you can be is what separates one Realtor from the next.
Let me tell you about what I believe will save the real estate industry and bring buyers back into the market. Are you ready? Here it is " Down Payment Assistance." Did you know that FHA allows a non profit organization to give a gift (called down payment assistance) to a buyer that can be used for the down payment and closing costs? Why is this HUGE? Your seller can give a give to Nehemiah(a down payment assistance provider) or similar approved 501c3 charity. The buyer of the seller's home can apply for a gift from the down payment assistance provider and use this to buy the home. How many sellers keep reducing the price of their home in order to get it to sell? Does this really help-at least today? Often it isn't the price-it's the terms. Buyer's today may be able to make the payment but can't come up with the required downpayment or closing costs. The down payment assistance programs solve this problem and allow a cash poor but otherwise qualified buyer to purchase the home.
The Twin Cities metro area has been designated a decling marketplace. This means Fannie Mae and Freddie Mac-the two purchasers of the majority of conventional loan products-are requiring buyers to put 5% down. This will make the housing crisis worse and last longer by eliminating otherwise qualified borrowers. FHA loans are sold to Ginnie Mae, and as of this writing, there is no adjustment for a declining marketplace. Now that you know about FHA and the possibility of a downpayment assistance option, you can overcome the 5% requirement.
Many mortgage brokers are not FHA approved because HUD requires audited financial statements and a net worth in the company of 63K. Not everyone can meet that threshold. So, if your favorite mortgage broker isn't FHA approved, you will need to find a broker or bank that is. It is estimated that FHA will finance 1/3 of the loans next year. If you aren't educating your buyers on a way for them to buy a home, I can guarantee you that another agent or lender will.
One of the oldest down payment assistance programs is called Nehemiah. Their website is http://www.getdownpayment.com You can go there to get the specifics. In addition, you can get a listing presentation and order free sign riders once you register at their site. You can also list your home as a participating home on their website for FREE.
When you are in competition for a listing, how many other agents are going to explain this program as a unique way to sell their home? My guess is not many-at least at this time. Grab this competitive edge while you can.
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GOVERNOR PAWLENTY ANNOUNCES ADDITIONAL ACTIONS TO ASSIST HOMEOWNERS FACING FORECLOSURE
~ Includes Foreclosure Counseling Workshops, funding for mediation, lender compact ~
Saint Paul –
"With additional help, the American dream of home ownership can be kept alive for more families facing foreclosure," Governor Pawlenty said. "Foreclosures continue to hit families and our state’s economy hard. We are hopeful that connecting more homeowners with counselors and providing a neutral third-party in some cases will help keep more homeowners in their homes, without negatively impacting the availability of credit in Minnesota."
Actions announced by Governor Pawlenty today include:
• Expanded Foreclosure Counseling Workshops to be held around the state
• Creation of the Minnesota Foreclosure Prevention Compact
• Mediation funding to assist homeowners when counseling is unsuccessful
• New Commerce Department assistance hotline for counselors
To provide Minnesota homeowners with additional tools to prevent foreclosure, Governor Tim Pawlenty today announced expanded foreclosure counseling workshops to be held around the state, creation of a compact with lenders to reduce foreclosures, and state funding for voluntary third-party mediation when counseling is unsuccessful.
Expanded Foreclosure Counseling Workshops to be held around the state
Governor Pawlenty announced a series of expanded mortgage Foreclosure Counseling Workshops around the state that bring lenders and borrowers together in one location. These workshops, sponsored by the Minnesota Home Ownership Center, will be greatly enhanced with additional lender participation. Lenders are being contacted directly by Department of Commerce to participate in these events.
Mortgage lenders and servicers will meet directly with homeowners to review their individual situation, and when possible, modify the terms of the loans in an effort to prevent foreclosure.
The first four expanded workshops will be held:
Tuesday, April 22, 4:30-8:30 p.m.
Minneapolis Urban League, 2100 Plymouth Avenue North, Minneapolis
Tuesday, May 13, 4:30-8:30 p.m.
Anoka County Technical College, 1355 West Highway 10, Anoka
Tuesday, May 20, 4:30-8:30 p.m.
Buffalo Discovery Center, 301 NE Second Avenue, Buffalo
Thursday, June 5, 4:30-8:30 p.m.
Eagan Community Center, 1501 Central Parkway, Eagan
Additional workshops in St. Cloud, Rochester and Duluth are being planned. More information is available at www.hocmn.org.
At Foreclosure Counseling Workshops, homeowners can ask questions and receive free and confidential advice from non-profit foreclosure counselors and mortgage lenders. The events are free and open to the public. There is no registration required and homeowners may stop by any time during the "open-house" style events.
Lenders and servicers asked to sign Minnesota Foreclosure Prevention Compact
Governor Pawlenty is asking lenders and servicers to sign a compact and agree to efforts to reduce foreclosures in Minnesota. The Department of Commerce has been meeting with lenders and servicers regarding the compact. Principles of the Minnesota Foreclosure Prevention Compact include:
• Work with mortgage foreclosure prevention counselors, and when necessary, participate in voluntary mediation.
• Participate in all Foreclosure Counseling Workshops in Minnesota.
• Engage in a substantial and large-scale loan modification effort for subprime mortgages and adjustable rate mortgage resets.
• Identify, evaluate and make good faith attempts to contact at-risk or defaulting borrowers as soon as possible.
• Modify loans to the extent permissible within existing fiduciary, contractual or other legal obligations and in accordance with prudent mortgage lending and servicing practices.
• Report progress to the Minnesota Department of Commerce.
Mediation funding to assist homeowners when counseling is unsuccessful
Because there are times when counseling cannot resolve issues surrounding a possible foreclosure, Governor Pawlenty has directed Minnesota Housing and the Department of Commerce to work with the Minnesota Homeownership Center and lenders to provide access to mediators when housing counselors and lenders believe it would be effective in keeping families in their homes.
Lenders and counselors have indicated that on occasion their efforts could benefit from the perspective of a neutral third party with mediation skills.
Mediators will be paid for by the state through grants from Minnesota Housing.
Earlier this month, Governor Pawlenty announced a $4.3 million federal grant, the second-largest such grant made to any state, to expand foreclosure prevention counseling in the state. With this funding, 37 additional counselors are being added to the statewide counseling network, for a total of 76 counselors.
Department of Commerce establishes Minnesota Foreclosure Hotline for counselors
At Governor Pawlenty’s direction, the Minnesota Department of Commerce has established a hotline for loan counselors if they experience problems contacting or negotiating with lenders. The department will then be able to contact the lender or servicers to ensure they are responding and acting in good faith.
The counselor hotline number is (651) 296-2569. This number should only be used by counselors and mediators, not individual homeowners.
Homeowners facing foreclosure are encouraged to call the Minnesota Foreclosure Hotline toll-free at
"The last thing your lender wants is for you to fall into foreclosure," said Minnesota Commerce Commissioner Glenn Wilson. "If you are behind on your mortgage and fear foreclosure, call your lender immediately for help or call the Minnesota Foreclosure Hotline."
Foreclosures typically occur due to unemployment or other loss of income. However, the increase in foreclosures beginning in 2006 is related to an increase in subprime loans and other non-traditional loans. Additional causes include flattening housing values, home equity cash-outs, and buyers assuming too much risk.
According to the nonprofit Housing Link, there were an estimated 20,573 foreclosures in Minnesota in 2007 – an 84% increase from 2006. Housing Link is projecting between 29,000 and 37,000 foreclosures in 2008. The figures are based on sheriffs’ sales of foreclosed properties.
1-866-462-6466 for information on counseling and other resources.
Pawlenty Administration’s ongoing efforts to curb foreclosures
Today’s announcement continues efforts by the Pawlenty Administration to address foreclosures and predatory lending practices in the state:
• Earlier this month, Governor Pawlenty announced a $4.3 million federal grant, the second-largest such grant made to any state, to expand foreclosure prevention counseling in the state. With this funding, 37 additional counselors are being added to the statewide counseling network, for a total of 76 counselors. It is estimated that this will result in 7,500 foreclosures being prevented this year.
• Also this month, Governor Pawlenty announced that Marquette Financial Companies provided a $500,000 grant to Minnesota Housing for foreclosure prevention deferred loans in the Twin Cities metropolitan area. These loans will be offered to homeowners who, with a modest amount of additional assistance, will be able to bring delinquent loans to current status over the long term.
• Minnesota mortgage laws were strengthened in 2007, significantly increasing the net worth requirements for mortgage originators operating as Minnesota corporations, requiring training for loan officers, and making mortgage fraud a specific crime in Minnesota. Minnesota law also now requires originators to verify a borrower’s ability to repay a loan and prohibits negatively amortizing loans, churning, subprime prepayment penalties, and partial payment quotes. These are among the toughest such laws in the nation.
• The Pawlenty Administration requested, and the legislature agreed, to add additional investigators at the Department of Commerce. The department assigned three additional investigators to respond to the increasing volume of cases and complexity of housing and lending fraud. For FY07 and the first half of FY08, the Minnesota Department of Commerce has taken 220 enforcement actions and imposed $678,850 in civil penalties in real estate or mortgage related cases.
• Minnesota’s ongoing commitment to foreclosure prevention includes a broad partnership that provides funding for a statewide network of counselors and state funding for foreclosure prevention loans of up to $5,500. Governor Pawlenty has proposed this year to increase the maximum size of these loans to $10,000 each. These efforts received an appropriation of $1.7 million in FY 2008-09.
• In 2007, Minnesota Housing made its largest single funding award ever of $11 million dollars to fund an effort in Minneapolis to acquire, rehabilitate, and re-market foreclosed and other vacant and boarded properties. A similar award of $500,000 was provided for a similar pilot program in Saint Paul.
• In 2007, the Minnesota Department of Commerce, with the support of the Minnesota Association of Realtors, transferred $500,000 to Minnesota Housing from the Real Estate Education, Research and Recovery Fund which is funded by real estate license fees. Minnesota Housing awarded the grants to the Minnesota Home Ownership Center and the Minneapolis Urban League for an early intervention foreclosure initiative for at-risk homeowners in targeted areas.
• In November 2007, Governor Pawlenty announced state funding for early intervention efforts and foreclosure prevention counseling. The Minnesota Housing award to the Greater Minnesota Housing Fund of $1 million was part of a response to a predicted 3-5 year situation. Another $800,000 in private, philanthropic and local funds were also committed to the effort. The funding doubled the number of
foreclosure prevention counselors from 18 to 37 statewide and effectively tripled the number of households that can be served.
The Minnesota Department of Commerce also reminds borrowers to beware of predatory lending practices. Homeowners who choose to refinance their mortgage should deal with a Minnesota licensed mortgage originator; check the department’s website at www.commerce.state.mn.us to
check the licensing status. Also, call the Minnesota Department of Commerce at (651) 296-2488 or 1-800-657-3602 to report suspected mortgage fraud. To contact a foreclosure prevention counselor, call the Home Ownership Center at (651) 659-9336 or (866) 462-6466. They will identify a counselor in a specific area of the state. The web site is www.hocmn.org
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