Join us in Burnsville for a free Investment Property 101.5 seminar. This seminar is meant to delve into the Cash Flow of a property and the different ways to analyze investment potential of a property, future cash flow, or current price. Brian Peterson, who has been analyzing investment properties for years, will go over many of the ratios and ways to look at your property financially. This seminar is meant for people wanting to take the next step, maybe looking to have several properties, or those who need a refresher on the tools and methods to analyze these properties.

There will be a special interest in multi-unit properties and commercial properties and ways to come up with prices, cash flows, or to compare to other investment properties. We have special guest Rob Bonahoom, from MN Home Loan Partners of Cornerstone Mortgage Company in Burnsville, to talk a little about the current financial environment for approving loans. Come take it to the next level with this outstanding seminar! You never know what you can take away from these events, but they have proved very valuable to investors in the past.

The Investment Property 101.5 seminar is located at the Cornerstone Mortgage Company office at 436 Gateway Boulevard in Burnsville from 6:30pm to 8pm on March 9th. Please click here to register or call 952-808-0042.

Popularity: 3% [?]

I know… what is a 203k loan??  A 203k loan is HUDs way of trying to help home-buyers get into a home that needs some help, while giving them access to funds to rehabilitate the home. It is a tool that combines planning, nonprofit organizations that specialize in housing, and smart lending to deliver an end product that helps you as a homeowner.

Have you been looking for a home and can’t find just that right one? Sure, you could make repairs or remodel certain properties to make them exactly what you are looking for, but that takes upfront money. Enter – Section 203 (k) or 203k. The 203k loan enables you as a home-buyer to purchase a home, make qualified repairs to the home, or rehabilitate the home and roll the repairs and upgrade costs into the mortgage loan.

Per HUD’s website, “The Section 203(k) program is the Department’s primary program for the rehabilitation and repair of single family properties. As such, it is an important tool for the community and neighborhood revitalization and for expanding homeownership opportunities. Since these are the primary goals of HUD, the Department believes that Section 203(k) is an important program and we intend to continue to strongly support the program and the lenders that participate in it.” (www.hud.gov 2010)

MN Home Loan Partners of Cornerstone Mortgage Company in Burnsville is very excited to be able to offer a free seminar to help home-buyers learn about the 203k process. Like anything unknown, it can be intimidating, but that is why we are here! Join us the first Tuesday of the month for the ‘Fixin’ To Stay? Try A 203k’ seminar. Elizabeth Vaughan of MN Home Loan Partners, goes over the details of the 203k loan process. She breaks it down, makes it all clear, and will help you determine if the 203k is the best loan for you. As I said before, its totally free, and no obligation, so stop by!

The 203k loan seminar will take place at Cornerstone Mortgage Company’s Burnsville office, starting at 6:30p. Please click hereto register so we have materials for everyone. Fixin’  To Stay, Try a 203k Seminar is offered each first Tuesday of the month.

Popularity: 27% [?]

This is a real issue. Don’t be one of the many that gets caught in the trap here. The clamp is about to shut and for some, the opportunity to buy will be gone.
Let’s talk about reality. The average interest rate for a 30-year fixed rate mortgage loan over the past 20 years has been in the neighborhood of 7.4%. Let’s just imagine that interest rates go up 1%, not even reaching that average interest rate for the past 20 years (which incidentally, I believe we could very well approach over the next 12-18 months and it will still be a GREAT interest rate). So, rates go up 1% – that’s a payment change of about $125/month on a $200,000 mortgage loan, the difference between a $200,000 and a $220,000 home loan OR, quite possibly the difference between qualifying or NOT for the home you wanted. $125/month in buying power can make a huge difference and a 1% change in the interest rate environment isn’t the only thing that’s likely to change in the upcoming months.
Will they extend the current tax credit for homebuyers? I can’t say what they’ll do come April 30th. Will they extend the tax credit yet again? It’s so hard to believe that they will…can…yet it’s a possibility. SO, maybe the up to $8,000 will be available after April 30, 2010 and, maybe it won’t. Let’s just throw it into the column for potential losses.
The average first-time homebuyer in today’s market is buying using FHA (Federal Housing Administration) financing for a number of reasons, one of biggest being the ability to get into a home for as little as 3.5% down payment and seller paid closing costs up to 6%. Conversely, there are certainly 3% down payment programs available in the Conventional Loan Market, but they require higher credit scores and have lesser allowable seller contributions.
BUT, oh yes, there’s always a BUT and this is a BIG ONE. FHA guidelines are changing and seller contributions are going down, from 6% to 3%! Using a $200,000 purchase price, that’s 6,000 additional reasons to buy now. Your minimum investment just went up significantly. Do you have an extra $6,000 laying around in your bank account?
We’re up to $14,000 in cash and $125/month and that is just the start. There are a host of other changes and ancillary issues that will come into play that add up to many buyers simply no longer qualifying to buy.
So, don’t get caught in the trap. If you’re ready and able to buy, start now! This is no time to be a fence sitter.

Popularity: 29% [?]

Many homeowners in today’s market find themselves upside-down in their homes. For some, a short sale is the solution, but there are many questions a homeowner should ask – and get the answers to – before entering a short sale agreement: How does a short sale differ from a foreclosure? How does a short sale impact my credit standing? Is there a waiting period before I can purchase a new home? Denae Frampton and Trent Johnson of The Minnesota Real Estate Team and Carrie Guarrero of the MN Home Loan Partners of Cornerstone Mortgage Company in Burnsville will provide an overview of the short sale process and answer these and other questions. They will also educate attendees on consumer scams to watch out for and grants and other solutions (such as refinancing a current mortgage) available to help qualified homeowners.

Seminars are held at our Cornerstone Mortgage Company office in Burnsville, MN.  Click  Here to Register For Seminar or call 952-808-0042. Since we know how busy life can get, we are proud to offer this free informational seminar on a monthly basis. The next dates for the Short Sale Solutions seminar are April 1 and  May 6.

Popularity: 25% [?]

Thursday, March 25th, 6:30-8PM*
*Location: Shoreview Community Center, 4580 Victoria St N #203

Are you a First Time Home Buyer? Not sure what to expect? Do you qualify for tax credits? How do you get pre-approved? Come learn about the buying process, from working with a loan officer to getting pre-approved and house-hunting with a Realtor, to getting your offer accepted and finally closing on your home!

Join Darcy McDonald of Cornerstone Mortgage and Tony D’Agostino and Steve Howe of The Minnesota Real Estate Team as they guide you through your real estate transaction. They will educate you about today’s current market, extended tax credits and special loans for those homes that may need a little TLC. Bring your questions we will be happy to help you get answers! After this seminar you will be prepared to hit the ground running and enjoy the adventure to get to your new home!

Click Here to Register For Seminar or call 952-808-0042
No worries, we will also host additional seminars coming up on April 22. South of the river location more convenient? Again, we have you covered. We host First Time Buyer seminars at our Burnsville Cornerstone Mortgage Company office as well, upcoming dates for the Burnsville location are March 18, April 15, May 20, and June 17.

Popularity: 33% [?]

A recent report states that 1 in 7 homeowners in the nation are behind on their mortgages and as many as 1 in 4 homeowners are upside down on their homes. We saw a record number of foreclosures in 2009 and yet, we are still sitting in a place where over 10% of the nations’ workforce is unemployed, who knows how many under-employed and, we’re expecting to see a recovery in the economy in 2010?
Well, I can’t answer whether we’ll see a recovery in the economy as a whole but I can tell you, in Minnesota, in my neck of the woods – Dakota and Scott counties – the time to buy or sell a home is now, before the next wave of foreclosures hits. Why?
1) As a nation, we have been artificially keeping interest rates low over the past year. The government says they are going to stop doing that in March. Result – most likely, increase mortgage interest rates.
2) There is a tax credit for first time home-buyers and current homeowners that ends with purchase agreements signed after April 30th. That’s less than 90-days folks and up to $8,000 you don’t want to lose.
3) FHA’s guidelines are changing and it’s going to cost more in mortgage insurance and more in closing costs by April 5th and early summer. See full information here
4) First-time Home-buyer money is being released now and is available on a first-come, first-served basis. What is available today is limited and not always replenished. i.e. http://www.knowyourhomeloan.com/dakota-county-to-release-new-money-for-first-time-homebuyers/

SELLERS – Traditionally, many sellers have waited until Spring in Minnesota to list their homes. In 2010, the four items above, in addition to the fact that we are currently in a sellers’ market and depending on your homes’ price range, you’re about to see some competition you may not want to be up against (the impending foreclosures) make that tradition a BAD one. As a seller, the market is right – now.
BUYERS – I can’t remember a time where there were so many incentives to buy! If you’ve been sitting on the proverbial fence – get off! First time home-buyers are especially blessed with benefits on the front-end in the way of down payment and closing cost assistance, silent second mortgages with no-interest and no-payments, some of which are forgiven over time, lower interest rates than most first-time home-buyers lifetimes have shown and back-end incentives like up to $8,000 tax credits and fix-up funds and energy-rebates to boot?!? Of course there are also the all-time forgotten, normal benefits to home-ownership like the interest and property tax deduction and well, the ability to paint your walls whatever color you feel like! HELLO people! Are you paying attention?? This is going to go away and if you are in the position to buy now, don’t be the one shaking your head a couple years down the road saying, “I wish I would have done this or known that two years ago.”

Popularity: 46% [?]

Question: Do I really have to provide all this paperwork JUST to pre-qualify for a mortgage?
Carrie: As a homebuyer in today’s real estate market, it may feel a bit like we’re asking for a whole lot more than you feel we should need to know (and it isn’t as bad as the picture suggests).  Let me ask you, if you were borrowing someone $150,000 for Burnsville real estate, what would you want to know about them?  Maybe you’d like to know where they’ve lived for the past couple of years (do they move around the country often without explanation or have they stayed local, perhaps Scott or Dakota County all their lives) and whether or not they’ve paid rent or their current mortgage on-time? What about whether or not they’ve paid back their other obligations on time, like credit cards or auto loans? Maybe you’d like to know that they’ve had a job for a couple of years and that there income has been stable? How about that they have a little bit of “skin in the game” by way of their own money for some down payment and possibly a little bit of money in the bank to fall back on in case of an emergency or, heaven forbid, they become one of the 10% of the nations currently unemployed?
That’s really what we’re asking for – it just takes a little bit more documentation today to prove it and, depending on your situation; whether you’ve moved around from one job to another, had multiple places that you’ve lived, been recently married or divorced, moved money around or had a few bumps in the road with regard to your credit. Unfortunately, those changes may mean more documentation. Sorry. It’s simply what it takes. If you are wondering how to get a mortgage, follow these simple steps from Cornerstone Mortgage Company as you prepare:
• Don’t throw away any financial paperwork
• Keep everything that you’re collecting and providing in an easily accessible file.
• Do your best to not make any financial changes unless absolutely necessary.
• Start the approval process early, talk to Cornerstone Mortgage Company before you go looking at homes.
• If you’re fearful about any part of your financial situation, let your lender know! Dust off those skeletons in the closet!

Popularity: 47% [?]

Question:

What is going on with the buzz about FHA making changes?

Carrie:

Did everyone think FHA was the only one who weren’t going to tighten-up lending guidelines? Frankly, I’m surprised it hasn’t happened sooner and, I’m pleased, for the most part.
So, what’s new? The down payment change to 5% DOES NOT appear to be happening. The current down payment requirement looks like it will stay at 3.5%. But, mortgage insurance amounts will change. On an FHA loan, mortgage insurance is required to be paid in the form of both upfront mortgage insurance premium and an annual mortgage insurance premium. Currently, these amount as set at 1.75% upfront and .55% annually for minimum down 30 year fixed rate mortgages. The change, that is scheduled to begin April 4, 2010, increases the upfront premium to 2.25% and leaves the annual premium at .55%  for 30 year fixed rate mortgages.

WHY? Because, mortgage insurance premium is there to protect them in the event of a loss and everybody and their brother flocked to FHA financing starting immediately in 2007 when the market meltdown took place. Lenders who had never done an FHA loan in their careers suddenly sought and sold it as the answer. Now, loans are defaulting. I’m not going to say that’s the only reason, of course FHA guidelines remained loose in the areas of credit and ratio requirements and the lenders simply approved the people who were “going through the system”. There’s simply not time enough here for me to go into my opinions about how we got here. One of the many facts is that FHA suddenly became the loan product to use and now, the result is rising foreclosures and the need to establish greater reserves and replenish the mortgage insurance fund. Not unreasonable considering the environment we’re in today.

On a positive note, FHA has long had a 90-day flipping guideline meant to prevent rapid sales at inflated values. FHA has temporarily lifted the flipping guideline for 1 year from February 1, 2010 to allow for investors to buy a home, fix it up and immediately re-sell it. Previously, the investor would have had to wait a minimum of 90 days before writing a purchase agreement. Hopefully, this will allow for some additional rehabilitation of homes that need it, spur the sale of home improvement product and remodeling employment and well as bring already repaired homes to the marketplace for first time home-buyers. Of course, as with all guideline changes, there are a host of additional rules to follow. For the complete mortgagee letter click here
Now here’s the kicker, the fun part. It’s really laughable. FHA is now going to require that borrower’s have 10% down if they have a credit score under 580. Well, I suppose if there were any investors out there who readily purchased loans with less than a 620 credit score, that might be helpful, but their aren’t. In addition, there are a few who are pushing to a minimum of 640, so really, it’s mute. Maybe, in the future, as lenders loosen their underwriting guidelines, maybe it will apply and FHA won’t have to change their guideline again down the road. Who really knows? Right now, it just really doesn’t make a difference and everyone needs to be well aware and focus on the minimum credit score requirements are as I’ve talked about before – 620 with 3 active lines of positive credit that have been around for 12 months. It’s not going to get easier and credit is KEY. To read more about mortgage credit requirements click here.

Popularity: 50% [?]

Yes, I’m speaking metaphorically. But it is a great way to describe the real estate market in Minnesota. So humor me…..

Incentives, low mortgage rates, down payment assistance programs, 6 percent seller paid closing costs….

Lets say you are a first time home-buyer in Minnesota, do you want to miss this ‘Sweetheart of a deal’ and lose out on the opportunity to get an actual $27,000 in hard money?? Well, if you are in the first time home buyer market and haven’t purchased yet, or don’t get moving and buy now… you can kiss that $27,000 goodbye. Literally.

Listen to The Minnesota Real Estate Show on KTLK, 100.3FM on Saturday, February 6th from 11am to noon to hear us hash out the details, but here is the basic breakdown.

First time home buyer purchasing a home for $175,000.

As a buyer of a distressed property (short sale or foreclosed) with an income under $67,200 a year, you could potentially take advantage of ALL of these down payment assistance and government programs:

The $8,000.00 first time home buyer tax credit.

$10,000 in down payment assistance.

$5,000 in seller paid closing costs

AND if you take advantage of today’s interest rates BEFORE they go up, you could save over $4,000 in monthly payments (the difference between your mortgage payment with the higher interest rate and the current interest rate over 5 years which is the average of how long people stay with the mortgage before moving or refinancing)

I know it is a lot to wrap your mind around, so here it is plain and simple: Take advantage of the sweetheart of a deal, don’t wait until the honeymoon is over. Now is the time to buy.

Tune in to The Minnesota Real Estate Show on Saturdays from 11am to noon to catch the discussion, and as always, feel free to call in and ask your question!

Popularity: 50% [?]

Popularity: 66% [?]