Monday, November 14, 2011

Southwest Minnesota Housing Partnership Awarded USDA Housing Preservation Grant

Used under Creative Commons
License.  Photo by  ario_ 
Funding will help maintain housing stock in SW Minnesota

The Southwest Minnesota Housing Partnership (SWMHP) has been selected to receive a $69,000 Housing Preservation Grant through USDA Rural Development. The grant will be used to assist 11 very-low and low-income households in the cities of St. James, Sleepy Eye, Winthrop, Gibbon and New Auburn make essential improvements and repairs to their homes.

SWMHP is a member of the Center's Homeownership Advisors Network and offers Home Stretch workshops and counseling, refinance counseling and foreclosure prevention services in dozens of counties in Southwest Minnesota.

The Housing Preservation Grant program provides funding to intermediaries such as town or county governments, public agencies, federally recognized Indian Tribes, and non-profit and faith-based and community organizations. These organizations then distribute the grants to homeowners and owners of multi-family rental properties or cooperative dwellings who rent to low- and very-low-income residents.  

Grants may be used to make general repairs, such as installing or improving plumbing or providing or enhancing access to people with disabilities. Funds may also be used to weatherize and make homes more energy efficient.

To learn more about the Southwest MN Housing Partnership, visit their website at  

Improvement and rehab programs available through the Southwest MN Housing Partnership are included in the Center's "Repair and Rehab Matrix" that we've created as a resource listing improvement, rehab and repair programs in local communities throughout the state.  Programs included in the Matrix include:
  • emergency repair, 
  • energy efficiency, 
  • lead hazard abatement, and 
  • general repair. 

Some funds are grants and others are loans, usually with below market interest rates.  Looking for help with repair or rehab on your home?  Visit the matrix page of the Center's website here:

Wednesday, November 9, 2011

Racial Disparities in Assets and Homeownership

© Mullica
Disparities in Minnesota continue to rise

The Minnesota Budget Project has reported that according to the American Community Survey (ACS) released by the U.S. Census Bureau last month, not only is poverty increasing in Minnesota, but disparities in poverty levels and household incomes between communities of color and whites are worsening. While the 2010 ACS reports that just under 12% of Minnesotans were living in poverty, the percentages according to race reveal a marked difference in poverty levels for communities of color--the highest being for American Indians which grew from approximately 31% in 2007 to just under 40% in 2010. Likewise, the median household incomes for Latino, black, and American Indian communities remain substantially lower than the statewide median household income for whites. Minnesota has historically suffered from racial disparities and, unfortunately, the latest reports do not hint towards the end of that plight. 

On a national level, Minnesota’s averages rank on the better end for overall poverty levels and median incomes. Again, though, when looking more specifically at communities of color, Minnesota’s ranking drops significantly. In fact, the poverty rate in Minnesota for Asians is just over 5 percentage points greater than the national average while for both blacks and American Indians the poverty rate sits as high as 10 percentage points greater than the national average. 

These racial disparities are all too often found in homeownership rates as well

In 2010, John Patterson and Michael Grover reported that the homeownership rate for emerging markets communities was more than 30% below the homeownership rate for whites - the 5th largest gap in homeownership rates in the country. Furthermore, the recent housing crisis has hit the emerging market community especially hard with mortgage delinquencies and foreclosures. While the homeownership gap appears to be narrowing, there is still a need to reach this population with homeownership education and opportunities.
In an effort to confront these issues in Minnesota, the Center leads the Emerging Markets Homeownership Initiative (EMHI) which works to develop systemic changes within the homeownership industry to increase homeownership opportunities for communities of color. Developing culturally-specific resources and services for emerging market consumers is a key component of this initiative. To learn more about EMHI events and resources offered by the Center, visit the EMHI page of our website, here.

FREE Continuing Education (CEUs) for real estate professionals!  
Learn more about the issues that Emerging Markets face and the efforts to achieve parity in homeownership rates in Minnesota at the FIFTH ANNUAL EMERGING MARKETS HOMEOWNERSHIP INITIATIVE SUMMIT.  Learn more about the Summit, and register, here.  The event has sold out in the past and we anticipate that it will sell out this year as well.  Register today.

Thursday, November 3, 2011

Stripping Off Second Mortgages in Bankruptcy

The Minnesota Homeownership Center and the Housing Preservation Project have developed a new fact sheet that outlines the recent changes to Chapter 13 bankruptcy allowing 2nd mortgages to be stripped off if they are wholly underwater.

Prior to a ruling in "Fisette v. Keller" (actually court documents, here, if you're interested) this summer, limitations in the Bankruptcy Code prevented a mortgage on a principal residence from being modified in a Chapter 13 bankruptcy. Now, various courts have held that when the amount of the first mortgage is more than the value of the property, the second and third mortgages - and any other junior mortgages - are no longer secured and the limitation on modification no longer applies.  These underwater second and third mortgages can be treated as unsecured claims, similar to credit card debt, and stripped off (removed or cancelled) by a Chapter 13 plan.

The fact sheet defines when second mortgages may be "stripped off" - and when they can't.  

The Center is continually developing and updating our fact sheets around foreclosure prevention and homebuyer services.  Visit our website often for the most recent versions of these documents... they're free to download and distribute!

Wednesday, November 2, 2011

Independent Foreclosure Reviews

Banks have begun complying with enforcement action.  Homeowners may be able to receive compensation on foreclosures conducted in 2009 and 2010

Under enforcement actions taken by the Office of the Comptroller of the Currency (OCC), the Federal Reserve, and Office of Thrift Supervision, more than a dozen large mortgage servicers are required to correct a number of problems with their servicing, loss mitigation and foreclosure processes.  These servicers are also required to engage independent firms to conduct reviews of foreclosure activities that took place during 2009 and 2010. 

Borrowers are eligible to submit a Request for Review to the independent consultants IF:
  1. their loan was serviced by one of the 14 servicers or their affiliates (see list below)
  2. the property is, or was, their primary residence, and 
  3. their loan was “active in the foreclosure process” between 1/1/2009 and 12/31/2010.

    Active in the process can mean:
    • Sheriff’s sale occurred on the property
    • Loan was referred to foreclosure but the sale did not take place due to a payment plan, modification, or non-retention option; and 
    • Loans were referred to foreclosure but are still in delinquency.

National media outreach will begin soon, and millions of homeowners will be notified by mail about the review process and will receive instructions for submitting a five-page Request for Review Form. As with any major announcement of this kind, we anticipate a number of copycat services and scams to pop up.

The independent reviews are free of charge and homeowners should never have to pay for foreclosure intervention services. 

If anyone asks you to pay for their help with a review... or sends you to a website other than the national website that has been set up by the OCC, be careful... it might be a scam!

The national website is:

Additional Information:
Requests for Review must be received by April 30, 2012. The independent consultants will confirm receipt of the form within one week, though the full reviews are expected to take several months to complete. The consultants will evaluate whether the homeowner suffered financial injury through servicer errors, misrepresentations or deficiencies in their foreclosure practices. In cases where findings indicate a homeowner suffered financial injury as a result of servicer practices, compensation or other remedies will be provided. The exact form of remediation is uncertain.

A copy of the OCC news release is here. 

Participating Lenders and Servicers (As of 11/2/2011)
     America’s Servicing Co.
     Aurora Loan Services
     Bank of America
     EverBank/EverHome Mortgage Company
     GMAC Mortgage
     IndyMac Mortgage Services
     MetLife Bank
     National City Mortgage
     PNC Mortgage
     Sovereign Bank
     SunTrust Mortgage
     U.S. Bank
     Wachovia Mortgage
     Washington Mutual (WaMu)
     Wells Fargo Bank, N.A.

As always... if you have any questions about this Independent Foreclosure Review or are looking for ways to prevent the foreclosure of your home, contact a FREE, Non-Profit foreclosure prevention counselor that is a member of the Homeownership Advisors Network!  To find your local counselor, click here.