Government loan programs - FHA loans

An FHA loan is insured by the Federal Housing Administration, a federal agency within the U.S. Department of Housing and Urban Development (HUD). The FHA does not loan money to borrowers, rather, it provides lenders protection through mortgage insurance (MIP) in case the borrower defaults on his or her loan obligations. Available to all buyers, FHA loan programs are designed to help creditworthy low-income and moderate-income families who do not meet requirements for conventional loans.

FHA loan programs are particularly beneficial to those buyers with less available cash. The rates on FHA loans are generally market rates, while down payment requirements are lower than for conventional loans.

Some of the other benefits of FHA financing:

• a 3.5 percent down payment is required.
• Funds may be available for downpayment assistance.
• Closing costs can be financed.
• Lower monthly mortgage insurance premiums and, under certain conditions, automatic cancellation of the premium.
• More flexible underwriting criteria than conventional loans
• FHA limits the amount lenders can charge for some closing cost fees (e.g. the origination fee can be no more than 1% of mortgage).
• Loans are assumable to qualified buyers.

Minnesota Mortgage Rates Below 4.5%!

I know many Minnesota first time home buyers are bummed out about the tax credit going away but hey, the fact is that with Minnesota mortgage rates hovering below 4.5%, now is still an incredible time to buy a home.  Add to that the fact that Minneapolis homes prices have been falling for the past two years and you really don't have a lot of reason not to buy a home today!


When my wife and I bought our first home, we were able to assume the sellers 9% mortgage and we were thrilled.  At the time mortgage rates in Minnesota were around 11%.  In my humble opinion, anyone who is making excuses as to why this isn't the right time to buy a home simply wasn't a real home buyer anyway. 

If you are paying attention to the falling home prices and rock bottom interest rates and you are thinking about buying a home in the Twin Cities metro area, visit www.mnonlinemls.com to get free access to the Minnesota MLS and see thousands of Minnesota homes for sale in every price range.

The fact is, owning a home will always be a smart component of your personal wealth plan so feel free to call Metropolitan Financial Mortgage Company with any questions you may have regarding financing your new home and locking in today's unbelievably low mortgage rates!

HAFA or Home Affordable Foreclosure Alternatives Program

The Home Affordable Foreclosure Alternatives (HAFA) Program is the governments program to help homeowners avoid foreclosure.

HAFA gives incentives to lenders, and homeowners to allow and complete a short sale or deed-in-lieu of foreclosure. If your Minnesota home or Minnesota mortgage is in jeopardy of default, follow the link below to see if you qualify for this government program.

Are you eligible? Use this tool to determine your eligibility; HAFA Questionaire

 

Credit Score Tips for Future Home Buyers

With the help of some easy -- if often counterintuitive -- steps, you can improve and retain a healthy credit score even in today's fast-changing credit environment.
Here is one of the five step I will share:

Open More Credit Cards
For years, credit experts warned that opening new credit cards will hurt your credit score -- not to mention enable you to run up huge debts.
That's still true: The length of your credit history and new credit make up 15% and 10% of the FICO score, respectively. But with credit issuers lowering credit limits left and right these days, having too few credit cards puts a much more important credit-score component at risk: credit utilization, or how much of your available credit you're using.

Credit utilization makes up 30% of your score. "More cards mean more available credit and more options if an issuer decides they don't like you," says John Ulzheimer, president for educational services at Credit.com. Generally, having four or five credit cards is better than having just one or two, he says. Expanding your credit-card portfolio isn't something you should do tomorrow -- it's a strategy to be executed over time. If you have just two cards, now is the time to open a third. But wait at least six months or a year until you apply for a fourth.

Please call Dominic at 612-247-8322 to find out more about your credit or for information about how to qualify for a Minnesota Mortgage.

How Changes To Credit Card Rules May Affect Your Credit Score

Credit is important to obtaining a mortgage and I want people to know that the rules that credit-card companies have to live by changed dramatically with the enactment of new regulations last month. Now, some of the rules for consumers striving to maintain good credit are
changing, too.

For the most part, card holders would still do well to pay on time, keep their balances low and refrain from applying for too many credit cards at once. But some of the old tenets may not
always hold up, as credit-card companies continue to adapt to the new environment and look
for ways to run their for-profit businesses.

Case in point: Many issuers introduced annual or inactivity fees in the weeks leading to or
immediately after the Credit Card Accountability, Responsibility and Disclosure Act went into effect. "Now folks have to decide -- do they want this card badly enough to pay the fee, or do they close it," says Barry Paperno, the consumer operations manager at FICO (FICO). It's a
question of more than just losing a credit line. Closing a credit card can have a big impact on one's credit score. That is, unless you do some groundwork in advance.

In the next few blogs, I will discuss how you have to approach credit differently than before the act and what you need to do to continue to qualify for a Minnesota Mortgage.

Please call Dominic at 612-247-8322 for more information or to access the MLS Minnesota.

Time is Running Out For First Time Home Buyer Tax Credit

There are only 45 days left to take advantage of the Minnesota first time home buyers program. A signed and accepted purchase agreement has to be in place by April 30th and a closing by June 30th. A first time home buyer is someone who has not owned a home in the last 3 years. Please call Dominic at 612-247-8322 for more information.

If you are looking for a first time home buyer seminar, visit http://www.firsthomeguide.com

$8,000 First Time Home Buyer Tax Credit is not the only home ownership help available to Minnesota Homebuyers

Time is running out on you as you try to purchase your first home and beat the deadline of April 30th and be one of the privileged American's to enjoy the first time home buyer tax credit. The city of Phoenix is offering down payment assistance that does not need to be paid back if certain requirements are met. The city of Minneapolis is offering the city living program. The state of Minnesota is very proactive educating the consumer on option and choices made available to the public through The Minnesota Home Ownership Center and the Minnesota Housing Financing Agency.