Minnesota Mortgage

MN First Time Home Buyer Seminar - Woodbury

Peter Lindquist — Mon, 30 May 2011 09:13:17 -0700

FREE SEMINARS FOR MN FIRST TIME BUYERS - June 2011

Isn't it time that you buy a home of your own? Now you can learn everything you need to know in our informative FREE seminar for first time home buyers. Our seminars for MN first time home buyers are 90 minutes in length and cover all of the topics of interest for the MN first time buyer.

* Learn about MN first time buyer programs
* Learn about MN down payment assistance programs
* Learn how to get the seller to pay YOUR closing costs
* Learn how to buy a home with limited or imperfect credit
* Our seminars are free and contain no obligation!

You can register online at: www.mnseminars.com

Minnesota First Time Home Buyer Seminars sponsored by Century 21 Premier Group

Date: Wednesday, June 8th, 2011 - Woodbury, Time: 6:30pm to 8:00pm

www.mnseminars.com

Home Buyer Seminars sponsored by:
Century 21 Premier Group
1660 S. Highway 100, Suite #578
Parkdale Plaza
St. Louis Park, MN, 55416-1566
www.21homesearch.com

Peter Lindquist
Mortgage Loan Officer – NMLS #389212

600 Inwood Ave N – Suite 210
Oakdale, MN 55128
Phone: 651-491-5381

Web: www.peterlindquist.com

Attention MN First Time Home Buyer

MN First Time Home Buyer Seminar - Woodbury

Peter Lindquist — Mon, 30 May 2011 09:12:46 -0700

FREE SEMINARS FOR MN FIRST TIME BUYERS - June 2011

You can register online at: www.mnseminars.com

Minnesota First Time Home Buyer Seminars sponsored by Century 21 Premier Group

Date: Wednesday, June 8th, 2011 - Woodbury, Time: 6:30pm to 8:00pm

For additional information visit us at http://www.mnseminars.com

Home Buyer Seminars sponsored by:
Century 21 Premier Group
1660 S. Highway 100, Suite #578
Parkdale Plaza
St. Louis Park, MN, 55416-1566
www.21homesearch.com

Peter Lindquist
Mortgage Loan Officer – NMLS #389212

600 Inwood Ave N – Suite 210
Oakdale, MN 55128
Phone: 651-491-5381

Web: www.peterlindquist.com

Attention MN First Time Home Buyer

Seminars for MN First Time Home Buyers

Peter Lindquist — Sat, 12 Mar 2011 10:41:24 -0800

Are you considering making this the year be come a first time home buyer in Minnesota? You are not alone! Many people today are considering making use of creative loan programs designed to help Minnesota first time home buyers.

Minnesota First Time Buyer’s Seminar Topics

In our seminars we will cover all of the topics that will concern a first time homebuyer.

How much do I need for a down payment and will I qualify for down payment assistance? While some programs still exist for no money down home loans, most programs will require at least some money down today. However for many borrowers, there are Minnesota down payment assistance funds available. We’ll talk about this as well as how to apply for the programs as well.

How much is a monthly payment on a house? We’ll review how monthly payments work, what’s included in them and how to make them affordable. We’ll review various fixed rate mortgage programs as well as federal government endorsed adjustable rate programs. We’ll cover the difference between FHA loans as well as conventional loans in the state of Minnesota.

How do I buy a foreclosure or short sale? In our seminar we’ll talk about the differences between the two and the best way to negotiate.on this type of property.

We’ll cover important topics such as how to get the seller to pay your closing costs on a first time buyer loan. The amount a seller can pay will vary widely not only on the type of first time buyer program but on the the type of seller as well.

There is no cost or obligation when you attend the seminar. It’s a great way to gain information on all that is offered to Minnesota first time buyers.

Registration is fast and easy. Just go to www.mnseminars.com and register today!

Peter Lindquist
Mortgage Loan Officer – NMLS #389212

600 Inwood Ave N – Suite 210
Oakdale, MN 55128
Phone: 651-491-5381

Web: www.peterlindquist.com

Attention MN First Time Home Buyer

Loan Fees Set To Rise For Conforming Mortgage Applicants

Peter Lindquist — Thu, 10 Mar 2011 09:41:45 -0800

Beginning April 1, 2011, Fannie Mae is increasing its loan-level pricing adjustments. Conforming conventional mortgage loan applicants in Minnesota should plan for higher loan costs in the months ahead.

If you’re considering a Minnesota mortgage refinance you might want to consider locking into a rate now.

If you've never heard of loan-level pricing adjustments, you're not alone; they're an obscure mortgage pricing metric and, thus, are rarely covered by the media. That doesn't make them any less relevant, however.

LLPAs are mandatory closing costs assessed by Fannie Mae and Freddie Mac, designed to offset a given loan's risk of default. LLPAs were first introduced in April 2009. This April's amendment is the 6th increase in 2 years. LLPAs can be costly. In addition to an up-front, quarter-percent fee applied to all loans, there are 5 additional "risk categories" in the LLPA equation:

Credit Score : Lower FICO scores trigger additional costs
Property Type : Multi-unit homes trigger additional costs
Occupancy : Investment properties trigger additional costs
Structure : Loans with subordinate financing may trigger additional costs
Equity : Loans with less than 25% equity trigger additional costs

Adjustments range from 0.25 points (for having a 735 FICO score) to 3.000 points (for buying an investment property with just 20% down payment). And they're cumulative.

This means that a borrower that triggers 3 categories of risk must pay the costs associated with all 3 traits. Loan-level pricing adjustments can be expensive -- up to 5 percent or more of your loan size in closing costs.

The fees can be paid a one-time cash payment at closing, or they can be paid in the form of a higher mortgage rate. The loan-level pricing adjustment schedule is public. You can research your own loan scenario at the Fannie Mae website, but you may find the charts confusing.

Peter Lindquist
Mortgage Loan Officer – NMLS #389212

600 Inwood Ave N – Suite 210
Oakdale, MN 55128
Phone: 651-491-5381

Web: www.peterlindquist.com

Attention MN First Time Home Buyer

Minnesota First Time Home Buyers With No Credit

Peter Lindquist — Thu, 10 Mar 2011 08:44:52 -0800

Every month I encounter buyers who are looking for Minnesota first time home buyer programs that can accommodate someone who has not established any credit. In this case, when I pull up the credit report there is literally no credit at all on the report. While almost all programs today require a borrower to have established at least some credit, the Minnesota Housing Finance Agency can help you with their MMP or CASA first time homebuyer program which has a no credit

How to Get a Loan With No Credit in Minnesota

In order to use the program with no credit on a credit report we need to build a non-traditional credit report through other means. For example if you have been renting a property with your name on the lease, you have been building credit in a non-traditional method. While the landlord does not report your payments to the credit bureau, evidence of your timely payments can be verified through our credit bureau and added to a special credit report used to obtain the MMP or CASA loan.

We need to find at least three ways that you have been building credit and at least one of them has to be rent. Other means can include items such as monthly car insurance payments, electric bills, water bills, cable bills, phone bills, etc. Basically any bill that you pay for on a monthly basis has the potential to be used to build this non-traditional credit report.

Of course, it’s important that any of these creditors report that you have been making your payments in a timely manner. Since building a non-traditional credit report for a buyer with no credit is a non-standard method, even one late payment can be a problem for an underwriter. The most important payment history is what has transpired over the last twelve months as many creditors don’t respond beyond that period of time. Additionally, a creditor that reports less than twelve months of payments won’t be used in the underwriting process.

It is also important to note that if we are going to be able to approve a buyer with no credit in Minnesota it’s important that you do not have negative credit either. For example if you have collections or judgments on the report, this can become a problem even if they have been paid.

The only way I can tell if we can help a buyer who has no credit on their credit report is to start a no-cost, no-obligation preapproval process. This can be as simple as a phone call in which I take your application information and discuss your financial situation with you. In this discussion I’ll ask about your income, assets, debts and means to build a non-traditional credit report.

No Credit Downpayment Assistance in Minnesota

If we utilize the MHFA CASA program you might also qualify for the HAF down payment assistance which presently is good up to $4,500 towards your down payment. If we use this in combination with seller paid closing costs it’s possible that a borrower might qualify using very little of there own money for cash required to close.

No Credit Loan Programs in MN

If you find yourself in this situation, wanting to buy a home in Minnesota but having no credit, please call me to discuss the possibilities. We will compare your current situation with the loan program parameters of Minnesota Housing Finance Agency’s MMP or CASA program and see if we can meet the terms of the program.

Peter Lindquist
Mortgage Loan Officer – NMLS #389212

600 Inwood Ave N – Suite 210
Oakdale, MN 55128
Phone: 651-491-5381

Web: www.peterlindquist.com

Attention MN First Time Home Buyer

MN First Time Buyers: Watch Out For NSF Fees

Peter Lindquist — Wed, 09 Mar 2011 22:45:39 -0800

One of the most commonly overlooked items of credit for Minnesota first time buyers is the nasty overdraft fee resulting from an “NSF”…otherwise known as a bounced check. These items do not show up on your credit report, but they do show up on a bank statement.

A mortgage underwriter will ask for a good explanation for the reason behind the NSF fee. If it is an occasional problem, this might not impact them too much. But if it’s a habit this may signal a credit problem to an underwriter.

Several banks now show the amount of NSF fees right on their bank statements as they accumulate throughout the year. When a mortgage underwriter is reviewing a borrower’s credit package and sees a large amount of NSF fees this can effect their decision, especially if the borrower has other credit issues on the credit report.

If you’re planning on buying a home this year be sure to take good care of your checking account and avoid NSF fees!

Peter Lindquist
Mortgage Loan Officer – NMLS #389212

600 Inwood Ave N – Suite 210
Oakdale, MN 55128
Phone: 651-491-5381

Web: www.peterlindquist.com

Attention MN First Time Home Buyer

Shoreview Foreclosures: How To Buy One

Peter Lindquist — Wed, 09 Mar 2011 21:10:00 -0800

Are you planning on buying a home in Shoreview MN this year? It’s pretty clear that you will find a high number of properties that are foreclosures. These properties can often represent a good deal, but many people make mistakes when making offers on Shoreview foreclosures that can easily be prevented.

How To Buy Shoreview Foreclosures (MN)

One of the questions I am most often asked is how to buy a foreclosure. It is simply not as difficult as you might think right away and almost definitely a great deal more certain than trying to buy a short sale.

When a property in Shoreview, MN is for sale as a foreclosure this means that the home is currently owned by the bank that had the loan on it. The previous homeowners were unfortunately not able to make the mortgage payments on the home anymore. The bank was forced to take back the property and list it for sale with a real estate agent. In almost all of these cases, this is a losing proposition for the bank that is selling the real estate.

As the owner of the real estate the lender is responsible for making all of the utility and property tax payments. I bring this to your attention so that you understand that the bank has a high motivation to sell the property. This is very different from a short sale where the selling lender can take several months to even answer your offer! In the case of a foreclosure sale you can often get verbal acceptance from the selling lender within a few days.

Get Pre-Approved to buy Shoreview Foreclosures

If you want to make an offer on any one of the Shoreview foreclosures you will certainly need to get preapproved for mortgage financing well ahead of time. When making an offer, time is of the essence. The selling bank simply will not even look at your offer unless they have your preapproval letter attached to the offer.

Getting preapproved to buy Shoreview foreclosures usually starts with a phone call in which I will ask about your income, assets, debts. From there I will see what you might qualify to. I understand how foreclosure negotiators work and have seen how they have begun to limit how much they are willing to build in the offer to pay your closing costs. I have strategies that I will discuss with you to help reduce the amount of down payment as much as possible.

Finding Shoreview Foreclosures

Most websites now have a feature where you can limit what you are searching for to foreclosures. Additionally your agent can help you by setting you up on an automated emails that send you Shoreview foreclosures in your price range.

When you go look at the listings you will need to be prepared for seeing properties that have not been well cared for. It is not uncommon to find a rather messy looking home inside. I encourage you however to look for value, not cleanliness!

How to Get A Good Deal on Shoreview Foreclosures

We’ve all heard the great fish tales about buyers who offered half-off the listing price and by golly the selling bank was so overwhelmed with joy that they just took the offer.

If that’s what you are expecting to happen, think again.

The issue of properties in foreclosure is not a new one. Over the last three years, Shoreview foreclosures have been selling all along. The selling lenders have learned a lot about the process and they usually list the property at a good value right from the start.

They have a specific plan on how long they will wait to accept reduced offers. The reason I tell you this is that you need to be realistic with any offer in order to get a good deal on a foreclosure!

If a property is just listed on the market the bank will likely not respond to those offers of thirty or forty percent off the asking price. The only time they might even respond to such an offer is if they have been sitting on the property for nine to twelve months or even longer. If you find a good home just listed at a good price, you might end up in a multiple offer situation in which case you might need to make an offer over the listing price.

If the property is worth it, then expect to pay the price for it. If it’s brand new on the market you might generally stay within ten per cent of the listing price if you want the home. If you purely want a “fish tale”, look for a home that has been on the market for twelve months or longer. That’s the only type of that is likely to respond to even drastically low offers.

Peter Lindquist
Mortgage Loan Officer – NMLS #389212

600 Inwood Ave N – Suite 210
Oakdale, MN 55128
Phone: 651-491-5381

Web: www.peterlindquist.com

Attention MN First Time Home Buyer

How To Buy Woodbury Foreclosures

Peter Lindquist — Wed, 09 Mar 2011 20:24:39 -0800

If you are in the market to buy a home in Woodbury, MN, chances are good that you will find a number of properties that are foreclosures. While the economy has been healthy, Woodbury foreclosures are as common as around the rest of the Twin Cities real estate market.

How To Buy Woodbury Foreclosures

One of the questions I am often asked is how to buy a foreclosure. It is not as difficult as you might think and certainly a great deal more certain than trying to buy a short sale.

When a property in Woodbury is for sale as a foreclosure it means that the home is currently owned by the bank that had the loan on it. The previous owners were not able to make the payments on the property anymore and the bank was forced to take over the property and list it for sale. In almost all cases, this is a losing proposition for the bank that is selling the property. By selling the home they simply want to reduce their losses.

As an owner of the property the bank is responsible for making all of the utility and property tax payments as well as any required maintenance. I tell you this so that you understand that the bank has a high motivation to sell the property. This is very different from a short sale where the bank can take several months to answer your offer! In the case of a foreclosure you can often get verbal acceptance from the selling bank within a day or two.

Get Pre-Approved to buy Woodbury Foreclosures

If you want to make an offer on any one of the Woodbury foreclosures you will need to get preapproved for mortgage financing ahead of time. Plan to do this well ahead of time! Timing is of the essence when making an offer on a foreclosure. The bank simply will not look at your offer unless they have your preapproval with the offer.

I’ve gotten the call before from agents who have encouraged their buyers to get preapproved but for one reason or another the buyer delayed. They found a house, needed to make an offer but came to me too late. They missed the opportunity because the delayed on calling me for preapproval.

Getting preapproved to buy Woodbury foreclosures is like any other property which means that most of what we need to do we can do right over the telephone. I will ask about your income, assets, debts and see what you might qualify to. I understand how foreclosure negotiators work and have seen how they have begun to limit how much they are willing to build in the offer to pay your closing costs. I have strategies that I will discuss with you to help reduce the amount of down payment as much as possible.

Find Woodbury Foreclosures

How to Get A Good Deal on A Foreclosure

We’ve all heard the great fish tales about buyers who offered half-off the listing price and by gosh the selling bank was so happy they just took the offer. If that’s what you are expecting, think again.

The issue of properties in foreclosure is not a new one. Over the last three years, Woodbury foreclosures have been selling right along. The selling banks have learned a lot about the process and they list the property at a good value right from the start. They have a specific plan on how long they will wait to accept reduced offers. The reason I tell you this is that you need to be realistic with any offer in order to get a good deal on a foreclosure!

If a property is just listed on the market the bank will likely not respond to those offers of twenty or thirty per cent of the asking price. The only time they might even look at such an offer is if they have been sitting on the property for six to nine months or longer. If you find a good property just listed at a good price, you might end up in a multiple offer situation in which case you might need to make an offer over the listing price.

If the property is worth it, pay the price for it. If it’s new on the market stay within ten per cent of the asking price if you want the home. If you purely want a “fish tale”, look for a home that has been on the market for twelve months or longer. That’s the only type of that is likely to respond to even drastically reduce offers.

Peter Lindquist
Mortgage Loan Officer – NMLS #389212

600 Inwood Ave N – Suite 210
Oakdale, MN 55128
Phone: 651-491-5381

Web: www.peterlindquist.com

Attention MN First Time Home Buyer

Federal Income Tax Deadline Extended To April 18, 2011

Peter Lindquist — Wed, 09 Mar 2011 10:39:06 -0800

April 15 is the traditional due date for federal income taxes. It's a deadline so ingrained in the American psyche that the April 15 calendar date is often called, simply, "Tax Day".

In 2011, however, federal taxes aren't due April 15. They're due April 18. It's because of a combination of holiday, calendars, and tax law.

The change centers on Emancipation Day. Emancipation Day is a public celebration in the District of Columbia. Named a holiday in 2005, Emancipation Day honors President Abraham Lincoln's April 16, 1862 signing of the Compensation Emancipation Act. Emancipation Day is a non-working day in the nation's capitol but, this year, Emancipation Day falls on a Saturday.

The municipality will observe the holiday Friday instead. This means that all of Washington, D.C. will be "closed" Friday, April 15 -- the usual tax filing deadline date. This includes the IRS. Therefore, to accommodate Emancipation Day, the government is extending this year's federal tax filing deadline to April 18, 2011. This year marks the second time Emancipation Day has forced the change of federal tax filing deadlines. Also, as a non-related coincidence, tax filers in Minnesota taking extensions to October 15 will also get a few extra days. October 15 is a Saturday so the extended tax deadline rolls over to the following Monday -- October 17, 2011.

Peter Lindquist
Mortgage Loan Officer – NMLS #389212

600 Inwood Ave N – Suite 210
Oakdale, MN 55128
Phone: 651-491-5381

Web: www.peterlindquist.com

Attention MN First Time Home Buyer

First Time Buyer Seminar - Shoreview, MN April 21st, 2011

Peter Lindquist — Tue, 08 Mar 2011 11:14:53 -0800

Are you a Minnesota first time home buyer living near Shoreview, MN? If you are considering buying your first home in Minnesota you’re welcome to attend our first time home buyer seminar. This is an opportunity to learn everything you need to know to become a homeowner in an our 90 minute first time buyer seminar!

Minnesota First Time Buyer Seminar Topics:

How to buy a foreclosure in Minnesota
How to apply for down payment assistance funds (for first time buyers)
The benefits of FHA, VA, and Conventional home financing for your first home purchase
The benefits of Minnesota Housing Finance Agency
How to ask (and get) the seller to pay your closing costs
How much money do you need for a down payment
How to get pre-approved for first time buyer loans

This seminar at Shoreview’s Community Center is free. Whether you are planning on buying soon or you’ve just started thinking about buying your first home in Minnesota, our first time home buyer seminar is the best way to get started!

Hosted by Peter Lindquist of River City Mortgage with over 19 years of experience in helping Minnesota first time buyers.

Registration for the Minnesota first time home buyer seminars is easy and you can do it online! Simply pick a seminar from the list of dates and locations in the right hand column. Fill out some basic information to register. We look forward to seeing you there!

Peter Lindquist
Mortgage Loan Officer – NMLS #389212

600 Inwood Ave N – Suite 210
Oakdale, MN 55128
Phone: 651-491-5381

Web: www.peterlindquist.com

Attention MN First Time Home Buyer

Home Affordability Peaked Last Quarter; Purchasing Power Sinks 10%

Peter Lindquist — Tue, 08 Mar 2011 09:32:48 -0800

Home affordability reached an all-time high in 2010's last quarter. Unfortunately for home buyers in Minnesota, while home affordability is still near record lows, buyers are losing a bit of purchasing power.

As Minnesota mortgage rates cratered, and with home values soft, the Home Opportunity Index reached its highest level in 20 years. The index is published by the National Association of Home Builders. Close to 74 percent of the new and existing homes sold between October-December 2010 were affordable to families earning the national median income of $64,400.

It's the 8th straight quarter in which the Home Affordability Index surpassed 70 percent. Prior to 2009, the HOI rarely topped 65 percent. That said, though, as with everything in real estate, home affordability is a local event.

For example, take the Elkhart/Goshen area of northern Indiana. 97 percent of homes sold there last quarter were affordable to families making the area's median income. This level of affordability is likely related to state capital Indianapolis, a perennial top-scorer itself.

For the second straight quarter -- and the 22nd time dating back to 2006 -- Indianapolis led all major metropolitan areas with a 93.5 affordability rating.

Meanwhile, on the opposite end of the home affordability spectrum, the "Least Affordable Major City" title went to the New York-White Plains, NY-Wayne, NJ area for the 11th consecutive quarter. Just 25.5 percent of homes were affordable to households earning the area median income. It's a a 6-point improvement from Q2 2010, however. T

The rankings for all 225 metro areas are viewable on the NAHB website but regardless of where you live, it's important to remember that rising mortgage rates this year have made homes less affordable in all markets across the United States. We won't see a repeat record in this quarter's HOI once it's calculated and published.

Home buyers in Woodbury have lost 10% of their purchasing power since November, and mortgage rates look poised to rise even more. If your plans call for buying a home later this year, consider moving up your time frame. The long-term costs of homeownership are rising, and affordability, therefore, is falling.

Peter Lindquist
Mortgage Loan Officer – NMLS #389212

600 Inwood Ave N – Suite 210
Oakdale, MN 55128
Phone: 651-491-5381

Web: www.peterlindquist.com

Attention MN First Time Home Buyer

Minnesota First Time Buyers Seminar | April 12th, 2011

Peter Lindquist — Tue, 08 Mar 2011 08:23:32 -0800

Are you a Minnesota first time home buyer living near Woodbury? No matter where you are buying a home in Minnesota you’re welcome to attend our first time home buyer seminar. Learn everything you need to know to become a homeowner in an our 90 minute first time buyer seminar! In our seminars you will learn all about:

How to buy a foreclosure in Minnesota
How to apply for down payment assistance funds (for first time buyers)
The benefits of FHA, VA, and Conventional home financing for your first home purchase
The benefits of Minnesota Housing Finance Agency
How to ask (and get) the seller to pay your closing costs
How much money do you need for a down payment
How to get pre-approved for first time buyer loans

This seminar at Woodbury’s Central Park Community Center is free. Whether you are planning on buying soon or you’ve just started thinking about buying your first home in Minnesota, our first time home buyer seminar is the best way to get started!

Hosted by Peter Lindquist of River City Mortgage with over 19 years of experience in helping Minnesota first time buyers.

Registration for the Minnesota First Time Buyer Seminar is easy and you can do it online! Simply pick a seminar from the list of dates and locations in the right hand column. Fill out some basic information to register. We look forward to seeing you there!

Peter Lindquist
Mortgage Loan Officer – NMLS #389212

600 Inwood Ave N – Suite 210
Oakdale, MN 55128
Phone: 651-491-5381

Web: www.peterlindquist.com

Attention MN First Time Home Buyer

Veteran Borrowers: Don’t Miss The $8,000 Homebuyer's Tax Credit!

Peter Lindquist — Mon, 07 Mar 2011 09:07:41 -0800

For certain members of the military, and for certain federal employees, there's just 2 months remaining to use the federal home buyer tax credit.

Eligible persons include members of the uniformed services, members of the Foreign Service, and intelligence community employees who served at least 90 days of qualified, extended duty service outside of the United States between January 1, 2009 and April 30, 2010.

Spouses of persons meeting the above criteria are eligible as well. The federal home buyer tax credit ranges up to $8,000 for first-time home buyers, and up to $6,500 for existing homeowners.

Existing homeowners must have lived in their "main home" through 5 of the last 8 years to be eligible.

How To Claim Veteran Homebuyer’s Tax Credit

Claiming the federal tax credit is a two-step process. First, eligible persons must be under contract for a new home on or before April 30, 2011. The home's closing must then occur on or before June 30, 2011. The IRS does not make date exceptions. Furthermore, both the buyer(s) and the subject property must meet certain minimum eligibility requirements:

The home may not be purchased from a parent, spouse, or child
The home may not be purchased from an entity in which the seller is a majority owner
The home may not be acquired by gift or inheritance
Each buyer must meet tax credit eligibility standards
The home sale price may not exceed $800,000
Buyers may not earn more than $125,000 as single-filers; $225,000 as joint-filers

The complete program description is published on the IRS website. Another important note is that the IRS is giving eligible buyers a tax credit as opposed to a deduction. This means that a taxpayer qualifying for the full $8,000, and for whom the "normal" 2011 federal tax liability is $8,000, will have zero federal tax liability in 2011. For additional information regarding your tax credit eligibility, call an accountant. Speaking with a tax professional is often worth the cost.

Peter Lindquist
Mortgage Loan Officer – NMLS #389212

600 Inwood Ave N – Suite 210
Oakdale, MN 55128
Phone: 651-491-5381

Web: www.peterlindquist.com

Attention MN First Time Home Buyer

FHA MIP Increasing

Peter Lindquist — Fri, 04 Mar 2011 09:32:35 -0800

For the third time in 12 months, the FHA is changing its mortgage insurance costs.

Effective for all FHA case numbers assigned on, or after, April 18, 2011, annual mortgage insurance premiums (MIP) will increase 25 basis points.

The change will add $250 to an FHA-insured homeowner's annual loan costs per $100,000 borrowed, and applies to all borrower's equally. Current FHA borrowers are unaffected.

To understand the FHA is to understand why premiums are rising.

As an institution, the Federal Housing Administration plays a much larger role in the U.S. housing market today than it did just 5 years ago. According to its own records, the FHA's percentage of purchase money business in Minnesota and nationwide expanded from 4 percent in FY 2006 to 19 percent in FY 2010.

Rapid growth like this has strained the FHA's capital and, indeed, in its official statement, the FHA alludes to this, stating that the MIP increase will "significantly strengthen" its reserves. By law, the FHA must maintain a certain minimum level of reserves.

FHA mortgage insurance varies by loan term, and by loan-to-value and, beginning April 18, 2011, the new insurance premiums are as follows:

15-year loan term, loan-to-value > 90% : 0.50% per year
15-year loan term, loan-to-value <= 90% : 0.25% per year
30-year loan term, loan-to-value > 95% : 1.15% per year
30-year loan term, loan-to-value <= 95% : 1.10% per year

To calculate your monthly mortgage insurance premium, multiply your starting loan size by your insurance premium, and divide by 12.

There is no change planned to the 1 percent upfront mortgage insurance premium charged by the FHA.

Peter Lindquist
Mortgage Loan Officer – NMLS #389212

600 Inwood Ave N – Suite 210
Oakdale, MN 55128
Phone: 651-491-5381

Web: www.peterlindquist.com

Attention MN First Time Home Buyer

Minnesota Rate Shoppers: Consider Locking Before Friday's Jobs Report

Peter Lindquist — Thu, 03 Mar 2011 09:07:46 -0800

Mortgage rates in Minnesota could begin to move higher beginning tomorrow morning. The Bureau of Labor Statistics releases its February jobs report at 8:30 AM ET.

Minnesota home buyers and rate shoppers in Saint Paul would be wise to take note of this. The jobs report is almost always a market-mover.

Remember last month.

Although net job creation fell well-short of expectations in January -- just 36,000 jobs were added -- the national Unemployment Rate dropped to 9.0%, its lowest level in 2 years. The marked improvement surprised many economists and sparked concerns about inflation within the investor community.

As a result, mortgage rates rose.

In the days immediately following the jobs report's release, conventional conforming rates across Minnesota jumped three-eights percent. That increase is equivalent to a mortgage payment increase of $22 per month per every $100,000 borrowed.

A similar spike may occur tomorrow.

Wall Street scrutinizes job growth because with more working Americans, there's more consumer spending, and consumer spending accounts for 70% of the U.S. economy. A blow-out number tomorrow would change expectations for the future, and lead Minnesota mortgage rates higher yet again.

The economy shed 7 million jobs between 2008 and 2009 and has barely made 1 million of them back. Tomorrow, analysts expect to see 183,000 jobs created. If the actual reading is lower-than-expected, mortgage rates should fall and home affordability will improve.

Anything else and mortgage rates should rise. Likely by a lot.

Therefore, if you're shopping for a mortgage right now, consider your risk tolerance. It could be that the best days are past us. Once markets open tomorrow, you can't get today's rates.

Peter Lindquist
Mortgage Loan Officer – NMLS #389212

600 Inwood Ave N – Suite 210
Oakdale, MN 55128
Phone: 651-491-5381

Web: www.peterlindquist.com

Attention MN First Time Home Buyer

Unrest in Middle East Impacting Home Sales

Peter Lindquist — Wed, 02 Mar 2011 14:10:27 -0800

Unrest in Middle East is impacting mortgage rates and ultimately home sales. Mortgage apps fell by 6% last week despite rates coming down after a temporary spike up due to the crisis. Concern over the middle east and the rise on fuel prices seems to be eroding homebuyer confidence according to this CNBC report.

Peter Lindquist
Mortgage Loan Officer – NMLS #389212

600 Inwood Ave N – Suite 210
Oakdale, MN 55128
Phone: 651-491-5381

Web: www.peterlindquist.com

Attention MN First Time Home Buyer

Ignore The Case-Shiller Index; Focus On The Future Instead

Peter Lindquist — Wed, 02 Mar 2011 09:13:53 -0800

Last week, Standard & Poor's released its S&P/Case-Shiller: Home Prices End 2010 on Downtrend' target=_blank>Case-Shiller Index for December 2010. The index is a home valuation tracker, meant to measure the change in home prices from one period to the next.

December's Case-Shiller Index showed major devaluations nationwide. As compared to December 2009, on a year-over-year basis, home values fell in 18 of the Case Shiller Index's 20 tracked markets, including Minneapolis, and the U.S. National Index dropped 4 percent overall.

The retreat puts December's home values at similar levels as compared to early-2003.

That said, Minneapolis home buyers and sellers would be wise to take the findings lightly. The Case-Shiller Index is inherently flawed. As such, its results are neither practical -- nor relevant -- to everyday Americans.

First Case-Shiller Flaw

The first flaw is the index's limited sample set. Wikipedia lists 3,100+ municipalities nationwide and we can be certain that real estate is bought and sold in all of them. The Case-Shiller Index, however, measures just 20 of them. That's less than 1% of all U.S. cities. And then, within those tracked cities, Case-Shiller reports an average, lumping disparate neighborhoods and streets into one big number.

The "national figures" aren't really national, and the "city data" doesn't apply to your home, specifically.

Second Case-Shiller Flaw

The second Case-Shiller Index flaw is how it measures home value changes. The index only consider at "repeat sales" of the same home, so long as that home is a single-family, detached property. Condominiums, multi-family homes, and new construction are ignored in the Case-Shiller Index.

Because distressed properties account for such a high percentage of resales lately -- 36% in December --foreclosures and short sales skew Case-Shiller Index worse.

Third Case-Shiller Flaw

And, lastly, the Case-Shiller Index is flawed by "age". Because it reports closed sales a 60-day delay, December's Case-Shiller Index is measuring the values of home sales contracts from September and October. The Case-Shiller Index, therefore, is a snapshot of the not-so-recent past, and does little to tell us about the next 60 days.

Overall, the Case-Shiller Index is helpful tool for economists and policy-makers, but it doesn't do much good for individual homeowners across the city of Minneapolis or anywhere else. For accurate, real-time housing data in your local market, talk to a real estate professional instead.

Peter Lindquist
Mortgage Loan Officer – NMLS #389212

600 Inwood Ave N – Suite 210
Oakdale, MN 55128
Phone: 651-491-5381

Web: www.peterlindquist.com

Attention MN First Time Home Buyer

Minnesota FHA Loans FAQ Part 1

Peter Lindquist — Tue, 01 Mar 2011 23:54:39 -0800

Over the past several years, FHA loans in Minnesota have become the most popular program for both home purchase and refinance loans. I’ve compiled an FAQ of typical questions regarding Minnesota FHA loans.

What is the minimum credit score for FHA loans?

The minimum credit score for FHA loans in Minnesota is as low as 500, depending upon the investor, however rates and down payments with a credit score under 640 tend to be higher.

Can I get an FHA loan with no credit in Minnesota?

There are 2 basic ways to get an FHA loan if you have no credit. If you have built credit through other means, we can create a non-traditional credit report provided that you have at least 3 “tradelines” that you have been paying over the last 12 months. At least one of the tradelines must be rent on a lease in which you are named. The other credit references can come from items such as cell phone, utility bills, monthly insurance bills, etc.

Alternatively, you might qualify for an FHA loan with no non-traditional credit but the guidelines become even more restrictive.

What is the minimum credit score for Minnesota First Time Home Buyers?

In order to qualify for Minnesota Housing Finance Agency (MHFA) funds using FHA financing you will need a minimum credit score of 620. However, in some cases, if you have no credit score, MHFA allows us to build a “non-traditional” credit report using alternative credit references.

How long after a foreclosure do I qualify for an FHA loan?

The present guideline from FHA states that a minimum of 3 years must have past since the date of the foreclosure as stated on your credit report. Good credit must have been re-established over that time as well.

How long after a bankruptcy can I get an FHA loan?

For a chapter 7 bankruptcy in Minnesota, you will need a minimum of 2 years since the date of the bankruptcy discharge. If you had a chapter 13 bankruptcy, just 1 year needs to have past since the discharge. In some cases you might also qualify for an FHA loan while still in a chapter 13 if at least 12 months have past since entering the program and if the bankruptcy judge allows it.

What is the maximum income guidelines for an FHA loan?

There is no maximum income guideline for FHA loans.

Do I have to be a first time buyer to qualify for an FHA loan?

If you are looking for a Minnesota FHA loan, remember that you do not have to be a first-time homebuyer to take advantage of the many benefits. Many borrowers today lack the down payment sufficient to qualify for a conventional loan and therefore are opting for FHA financing even though they have owned homes in the past.

How long do I need to be on my job before I qualify?

FHA has perhaps the most liberal of guidelines for length of employment. While the general guideline is that you must have been on your job for at least 6 months, there are many exceptions to this rule. If you are concerned about the length of your employment history please call me to discuss your individual scenario.

How long before I can get rid of mortgage insurance on an FHA loan?

You must make timely monthly payments for a minimum of 60 months (5 years) before you can apply to remove the monthly mortgage insurance premium. You must also establish that you have at least 22% equity in the property based on the original appraised value. The Up-Front Mortgage Insurance Premium (UFMIP) does not come off of the loan unless you pay it off (i.e. through a refinance or sale of your home).

Are FHA loans in Minnesota assumable?

This is one of the unique features of an FHA loan. Your FHA loan is assumable which means that when you go to sell your property, the new buyer can assume the balance of your loan, provided that they qualify. This can be a great sales feature when you go to sell the home if your interest rate is better than the going rate of the day!

Peter Lindquist
Mortgage Loan Officer – NMLS #389212

600 Inwood Ave N – Suite 210
Oakdale, MN 55128
Phone: 651-491-5381

Web: www.peterlindquist.com

Attention MN First Time Home Buyer

Minnesota Housing HAF Down Payment Assistance

Peter Lindquist — Tue, 01 Mar 2011 22:45:13 -0800

We are fortunate in Minnesota to have the Minnesota Housing Finance Agency (MHFA). This program offers up to $4,500 of down payment assistance to Minnesota first-time home buyers through it’s CASA program.

Let’s take a look at some of the qualifications necessary to qualify for MHFA down payment assistance using HAF and CASA.

Basic Eligibility for Minnesota First Time Home Buyer’s Down Payment Assistance

You must not have owned any other real estate within the past 36 months
You must qualify for the underlying first mortgage program such as an FHA loan
You must have a minimum credit score of 620
You must meet the maximum income guidelines listed below

Maximum Purchase Price

11-County Metro area: $298,125

All other counties in Minnesota: $237.031

Minnesota Down Payment Assistance Type

The HAF assistance down payment is a second mortgage that has zero interest and no payments due. It only needs to be repaid upon refinancing the loan or selling the home.

Minimum Investment Required

You must contribute a minimum of $1,000 towards down payment in order to qualify for the down payment assistance from Minnesota Housing.

Remaining Funds After Closing

You must not have more than $5,000 in liquid assets remaining after closing.

Do I Qualify for Minnesota Down Payment Assistance?

The easiest way is to start your pre-qualification at www.peterlindquist.com or to call me at 651-491-5381.

Maximum Income Limitations for Down Payment Assistance

The chart on the MHFA website shows the Homeownership Program Eligibility Income Limits. It also shows the availability of Entry Cost Assistance programs (Homeownership Assistance Fund (HAF) and HOME HELP) for Minnesota Housing first-time homebuyer programs:

Peter Lindquist
Mortgage Loan Officer – NMLS #389212

600 Inwood Ave N – Suite 210
Oakdale, MN 55128
Phone: 651-491-5381

Web: www.peterlindquist.com

Attention MN First Time Home Buyer

Hennepin County FPP Down Payment Assistance

Peter Lindquist — Tue, 01 Mar 2011 22:02:55 -0800

FPP Funds in Hennepin County

This source of down payment assistance funds is designed for home buyers within certain census tracts in Brooklyn Park, Brooklyn Center, Champlin, Crystal, New Hope, Maple Grove, Robbinsdale, Rogers/Hassen Township, and Richfield of Hennepin County.

Note that I said home buyers, not first time home buyers. This program is fairly rare in that you do not have to be a first time home buyer, but at the same time, you cannot currently own another property.

The program can provide up to $10,000 of incentive assistance, however the program can provide up to another $20,000 of affordability assistance under certain circumstances.

The property for sale cannot be a foreclosure. I’ve detailed some of the highlights below.

Eligible Borrowers for FPP

Income Limitations for FPP Assistance in Hennepin County

The household income (all occupants) cannot exceed eighty percent of the HUD median income for the are. The maximum incomes are listed below based on family size.

	1	2	3	4	5	6	7	8
	45,100	51,550	58,000	64,400	69,600	74,750	79,900	85,050

Hennepin County FPP Loan Terms

The FPP assistance is a second mortgage on the property you purchase but it has no interest and no monthly payments. The term of the loan is either 5 years or 10 years depending upon the amount of assistance that you receive. During the term of the loan, if you no longer occupy the property or you sell the home, the loan must be paid back.

Do I Qualify for FPP Funds?

Call me today at 651-491-5381 or start your pre-approval application at www.peterlindquist.com

Property Types Eligible for FPP

Single family houses including detached housing, townhomes, condominiums)
Homes that are not under foreclosure ONLY
Homes that are not currently rented ONLY

Maximum Purchase Price for Hennepin County FPP

The maximum sales price is $200,000 if you want to use Hennepin County’s FPP program.

Homeownership Counseling

As with most down payment assistance programs, you will be required to attend a Home Stretch Workshop. You can find and schedule these workshops at www.hocmn.org

Minimum Investment Required for FPP funds in Hennepin County

You must contribute at least $1,000 of your own money toward down payment or closing costs.

Hennepin County Exclusion for FPP Program

If you have had another loan through Hennepin County you cannot qualify for this financing.

Prior Foreclosures

You cannot have had a foreclosure in the last 5 years.

Eligible Census Tracts for FPP in Hennepin County

The home must be within a certain census tract of Brooklyn Park, Brooklyn Center, Champlin, Crystal, New Hope, Maple Grove, Robbinsdale, Rogers/Hassen Township, and Richfield of Hennepin County in order to qualify.

To find the census tract use this website:

http://factfinder.census.gov/

The census tract of the property must be in one of the following in Hennepin County:

City	Census Tracts	Block Groups
Brooklyn Center	204.00 202.00 203.01 203.04	ALL
Brooklyn Park	268.07 268.09 268.10 268.11 268.14 268.15 268.16 268.18 268.19 268.21	ALL
Champlin	269.06 269.08	ALL
Crystal	208.01 213.00	1-3 3
Maple Grove	267.07 267.10	ALL ALL
Mound	276.02	ALL
New Hope	215.02	1-3
Robbinsdale	213.00 214.00	1,2,41-3 1-3
Rogers/Hassan Twp	269.09	ALL
Richfield	248.01 248.02 249.01 249.02 249.03	1-2 1-3 2-3 1-2 1-2

Peter Lindquist
Mortgage Loan Officer – NMLS #389212

600 Inwood Ave N – Suite 210
Oakdale, MN 55128
Phone: 651-491-5381

Web: www.peterlindquist.com

Attention MN First Time Home Buyer

Home Sales: Pending Sales Drop Again in January

Peter Lindquist — Tue, 01 Mar 2011 09:18:01 -0800

The housing market cooled off a little in January after finishing with strength at the end of last year.

Pending Home Sales Index

By taking a seasonally-adjusted basis the PHSI (Pending Home Sales Index) fell by 3 percent last month. Along with that the National Association of REALTORS® revised December pending sales down as well.

When a purchase agreement is accepted on a property it is considered “pending” though it is not yet closed.

The forward-looking index is presently at a 3-month low nationally while being ahead over a 6-month rolling average.

While the data isn’t necessarily helpful to buyers and sellers of real estate, The National Association of REALTORS® makes an effort to get more granular, supplementing the Pending Home Sales Index report with a region-by-region breakdown. Over the months of December 2010 and January 2011, only region in the South experienced an increase.

Pending Home Sales Index By Region

Unfortunately for Minnesota, the Midwest dropped the most:

Northeast Region: -2.4%
Midwest Region : -7.3%
South Region : +1.4%
West Region : -5.2%

Even still, however, regional data remains too broad to be practical.

The South Region, for example, is comprised of multiple states with thousands of cities and town. The housing market dynamics of a specific neighborhood in a specific regional city will differ from that of another neighborhood in another regional city.

Real estate data must be local to be relevant. Overall, then, what may be most telling from January's Pending Home Sales Index is how our tough winter weather impacted the results. After all, who wants to go out to open houses in a 12” snow storm?

Most of the country faced drastic weather conditions in January, ranging from raging snowstorms to bitter cold. Events like that tend to put a damper on home sales, a contributing factor in why the number of new purchase agreements fell.

Minnesota Mortgage Rates Rise

Another reason is rising mortgage rates. Rates for conforming and fha loans in Minnesota rose week-by-week in January 2011, robbing home buyers of 10% of their purchasing power. This, too, can slow down purchase activity as buyers adjust their expectations. As we go into the spring I expect the Pending Home Sales Index to improve.

Bad weather doesn't entirely stop demand; it just delays it. Mortgage rates are still incredibly low. These two factors should help release pent-up demand just as the Spring Home buying season gets underway. As more buyers enter the market, negotiation leverage will shift to home sellers, pressuring Saint Paul, Minnesota home prices higher.

The lowest prices of the year -- and the lowest rates -- could be what we are experiencing today.

Peter Lindquist
Mortgage Loan Officer – NMLS #389212

600 Inwood Ave N – Suite 210
Oakdale, MN 55128
Phone: 651-491-5381

Web: www.peterlindquist.com

Attention MN First Time Home Buyer

Looking Ahead: Mortgage Rates for Week of February 28, 2100

Peter Lindquist — Mon, 28 Feb 2011 09:21:47 -0800

Mortgage markets improved over the past week as Wall Street's concerns about trouble in the Middle East trumped its fears of inflation. Conforming loan rates and FHA mortgage rates in Minnesota fell to the lowest level in three weeks.

Mortgage Rates Last Week

Last week marked the second straight week in which mortgage rates in Minnesota fell. This is a streak that follows 4 consecutive weeks in which rates climbed. It's been a bout of good fortune for rate shoppers and Minnesota home buyers.

In addition, according to Freddie Mac's weekly mortgage rate survey, the average spread between conforming 30-year fixed rate mortgages and 5-year ARMs has widened further.

The two benchmark products are now separated by 1.15%. It's the largest interest rate gap in recent history; one that yields a monthly payment difference of $68 per $100,000 borrowed.

This week, it's unclear in what direction mortgage rates in Minnesota will go.

On one side, there's ongoing unease related to protests in Libya and its neighbors, and that's driving safe haven buying.

"Safe haven buying" describes when investors flee risky situations and put their money in the safest places possible. Mortgage bonds are one such place, so when safe haven buying is in effect, bond demand is high so bond yields (i.e. mortgage rates) fall.

Concerns About Inflation

On the other side, inflation appears to be ramping up.

Recent economic data shows that the economy is expanding, and the Federal Reserve is maintaining its accommodative growth policies. Therefore, this week, the key economic event will be Friday's jobs report. if job creation is high, expect inflation fear to re-ignite, and mortgage rates to rise.

Another risk factor for this week's rate shoppers is that tensions begin to settle in the Middle East, or that Wall Street gets more comfortable with rising oil prices. If that happens, safe haven buying will subside and mortgage rates will resume rising.

There appears to be more reasons for mortgage rates to rise this week than for them to fall. Plan accordingly.

If you have not locked a mortgage rate yet, this week may represent your last chance to get a low one. Talk to me and make a plan.

Peter Lindquist
Mortgage Loan Officer – NMLS #389212

600 Inwood Ave N – Suite 210
Oakdale, MN 55128
Phone: 651-491-5381

Web: www.peterlindquist.com

Attention MN First Time Home Buyer

FHA Mortgage Insurance Premiums Set To Increase April 18, 2011

Peter Lindquist — Tue, 15 Feb 2011 09:52:25 -0800

FHA annual mortgage insurance premiums will increase by one-quarter per cent on April 18^th, 2011 according to FHA's Commissioner, David Stevens. The most recent FHA mortgagee letter says that the up-front mortgage insurance premium which is usually financed in a real estate transaction will remain the same at one per cent.

"After careful consideration and analysis, we determined it was necessary to increase the annual mortgage insurance premium at this time in order to bolster the FHA's capital reserves and help private capital return to the housing market," said Stevens. "This quarter point increase in the annual MIP is a responsible step towards meeting the Congressionally mandated two percent reserve threshold, while allowing FHA to remain the most cost effective mortgage insurance option for borrowers with lower incomes and lower down payments."

In August of 2010, FHA restructured the way they charge mortgage insurance premiums, loading the bulk of the premiums into the borrower's monthly payments versus a larger financed amount. At that time Congress cleared the way for FHA to increase its monthly mortgage insurance premiums all the way to 1.55%.

Under the present terms new FHA borrowers will pay 1.15% of the mortgage amount towards instead of .90% as they have paid recently. In real terms this will increase monthly payments for FHA borrowers by about $30. Another way of looking at it, of course, is that it will decrease the maximum qualifying power of borrowers by an equivalent amount, resulting in a drop of about $5,000 to $6,000 in maximum loan amount.

The April 2011 mortgage insurance premium change will not impact homeowners who already have FHA loans.

If you are looking for a home in Minnesota now is the time to buy. Over the past several months we have seen a general increase in mortgage rates and mortgage insurance premiums which ultimately increase the cost of owning a home. In order to obtain the present monthly mortgage insurance premiums a buyer needs to make a loan application for a property under contract prior to April 18^th, 2011.

While this increase is not entirely unexpected it is yet another signal from FHA that they want to reduce their role in the mortgage lending industry. With the rapid changes over the past few years FHA's involvement has increased to unprecedented levels.

Over time we can expect more changes from FHA such as increased down payment requirements and tougher underwriting guidelines. These changes will eventually push more borrowers towards conventional mortgage financing which has generally been tougher to obtain in recent months. As a result, stocks of conventional mortgage insurance companies have been rising recently.

Are you ready to learn more about buying a home in Minnesota? Give me a call today!

Peter Lindquist
Mortgage Loan Officer – NMLS #389212

600 Inwood Ave N – Suite 210
Oakdale, MN 55128
Phone: 651-491-5381

Web: www.peterlindquist.com

Attention MN First Time Home Buyer

Minnesota FHA Loan Programs: Part 2

Peter Lindquist — Sat, 12 Feb 2011 14:15:00 -0800

In the first part of this article we talked about many of the benefits of the FHA loan program in Minnesota. In this part we’ll talk some more about the unique aspects.

Minnesota FHA Programs

Most Minnesota buyers today are opting for the fixed rate programs offered by FHA. These are available in 30 year fixed rates as well as 15 year. While most buyers will shy away from adjustable rate mortgages (ARM) in a low rate environment for good reason, FHA also offers ARMs that become popular in a rising rate environment. With these loans the rate is fixed for an initial period of time (1 year, 3 year, or 5 years). These loans start a rate lower than a fixed rate would and have caps which limit the amount the rate can change both annually as well as over the lifetime.

FHA Mortgage Insurance

In order to get a mortgage loan in Minnesota with less than a 20% down payment, you will in most cases pay something called mortgage insurance. In short, mortgage insurance pays off part of a lender’s losses in the event of a foreclosure. FHA charges mortgage insurance in two ways: 1) An up-front mortgage insurance premium (UFMIP) and 2) a monthly mortgage insurance premium. The premiums vary based upon the amount of your down payment as well as the mortgage term (30 year or 15 year).

The monthly premium can be eliminated after a minimum of 5 years of payments have passed. At that point, if it can be established that you have 22% equity in your property based upon the original appraised value, you can ask your mortgage servicer to remove the monthly mortgage insurance from your monthly payments.

The FHA Appraisal

One of the most important aspects of an FHA loan is the appraisal. If you opt for this type of financing we need to order an appraisal from an FHA approved independent appraiser.

While the appraisal of the property is done primarily to assess the value of the property you are trying to purchase, the Minnesota FHA appraiser is also charged with looking for certain types of property deficiencies that have been identified as issues by FHA. For example, if you are buying a house that is older than 1986, the appraiser will be looking for chipping paint on any building on the property. If they identify chipping paint, the area will need to be scraped and painted prior to being able to close on the home.

You should not confuse the role of an FHA appraiser with that of a home inspector. Even though the FHA approved appraiser will look for certain property issues, it is not their primary concern. A home inspector will spend several hours in the property looking for issues that may cause you problems down the road. Although a home inspection is not required in order to obtain an FHA loan, it is highly advised to get one in addition to the FHA appraisal which is required.

FHA loans are Assumable

Imagine six or seven years from now when you are ready to sell your home. If interest rates are higher when you go to sell your home you will have an attractive sales feature because your loan will be assumable. FHA allows you to sell the home to a buyer who can qualify for your loan using the assumable feature. Your buyer simply needs to make up the down payment between your sales price and the amount you owe. They take over your loan from there and release you from liability.

FHA Preapproval

Is a Minnesota FHA loan right for you? The only way to find out is to get preapproved for financing. By analyzing your entire financial situation I can help you discover whether a FHA loan or another type of financing is best suited to your individual situation.

Read more about FHA loans in part 1 of this article.

Peter Lindquist
Mortgage Loan Officer – NMLS #389212

600 Inwood Ave N – Suite 210
Oakdale, MN 55128
Phone: 651-491-5381

Web: www.peterlindquist.com

Attention MN First Time Home Buyer

FHA Loans Minnesota: Is an FHA loan right for you?

Peter Lindquist — Sat, 12 Feb 2011 14:09:52 -0800

When I bought my first home in Minnesota back in 1986 I took out an FHA loan for $68,000 at an interest rate of 10.5%. When I started originating home loans in 1991 I was helping Minnesota first time buyers obtain FHA loans on a regular basis. About 1 in 4 of the loans I was originating back then were insured by FHA and had rates around 8%. Over the last 3 years FHA has made a dramatic resurgence and upwards of two-thirds of my borrowers are opting for FHA loans now with interest rates less than half of that when I bought my first home!

In this article you will learn some of the basic facts and benefits of Minnesota FHA loans to buy a home. (I will describe FHA for refinance loans in an upcoming article)

FHA Loans Minnesota: Who is FHA?

The Federal Housing Administration (FHA) is the largest insurer of home mortgages in the world. Since it began helping American homebuyers in 1934 it has insured well over 30 million homes in the United States. FHA provides mortgage insurance on loans made by FHA-approved lenders throughout the United States, allowing lenders to offer mortgage loans with less than the traditional 20% down payment.

Benefits of an FHA Loan in Minnesota

The fact is that today FHA loans are not just for Minnesota first time buyers any more. With its expanded credit features and low down payment requirements, most buyers today are considering using an FHA loan to help finance the purchase of their home.

FHA Loan Down Payments

As a first time buyer in Minnesota, there are additional benefits to FHA that might be attractive as well. For example, the state of Minnesota offers special financing targeted to the first time buyer that work in combination with FHA to offer beneficial interest rates to qualified buyers. Additionally, the Minnesota Housing Finance Agency offers down payment assistance programs which are allowed through the FHA.

While these Minnesota programs have maximum income parameters, FHA loans do not have a maximum cap on income making it available to everyone. The program allows a buyer to obtain the down payment for the purchase of a home entirely as a gift or loan from a relative unlike many other types of financing.

FHA Loan Credit Requirements

There are expanded credit parameters for FHA loans in MN as well. For buyers with minimal credit or a checkered credit history, the FHA guidelines allow for an underwriter to have more understanding of how these things happened. For example and FHA loan currently allows a buyer with a bankruptcy to qualify as quickly as two years since the date of the bankruptcy discharge, provided they have re-established credit. In the case of a recent foreclosure FHA will allow a Minnesota buyer to qualify just three years later.

Employment and Income

In today’s economy many buyers may have experienced a spotty work history as well through layoffs and business closings. With FHA an underwriter can look upon these issues with a broader understanding. While a two year work history is still required, periods of extended unemployment can still be alright in many circumstances.

FHA Co-signer

Unlike most mortgage programs, you can overcome some qualifying issues through the use of a non-occupant co-signer. This used to be a popular option when I first started originating loans in the early 1990’s and has made a comeback today where parents and siblings help each other out through the process of co-signing. While a non-occupant co-signer does not overcome issues of poor credit, it can help overcome an otherwise unacceptable job history, income stream, or debt ratios.

Property types with FHA Loans

Buyers can use FHA loans for many property types such as townhomes, condominiums, or traditional single family homes. Additionally FHA allows you to buy income producing properties such as a duplex, triplex, or four-plex as long as you are going to occupy the residence. (FHA is only available to buyers who are going to live in the home they are purchasing—it is not for investment properties or vacation homes).

Read more about FHA loans in Minnesota in part 2 of this article.

Peter Lindquist
Mortgage Loan Officer – NMLS #389212

600 Inwood Ave N – Suite 210
Oakdale, MN 55128
Phone: 651-491-5381

Web: www.peterlindquist.com

Attention MN First Time Home Buyer