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Preforeclosure Notices Continue to Decline in Minnesota

2012-01-19T08:20:00.003-06:00

On Thursday, January 19th, the Minnesota Homeownership Center released its year-end data on the aggregate number of Preforeclosure Notices received by foreclosure counselors in the Homeownership Advisors Network. The numbers continue to indicate that Minnesota is slowly emerging from the foreclosure crisis.

In the fourth quarter of 2011, members of the Homeownership Advisors Network received 12,016 preforeclosure notices, 30% fewer than during the same time period in 2010, reaching the lowest level reported since the state legislature required the notices in late 2008:

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On a yearly basis, Minnesota households received 24% fewer preforeclosure notices in 2011 than they did in 2010.

Most encouraging is that the fact that the numbers of preforeclosure notices received is down in every county in the Metro area. In addition, every agency in the Homeownership Advisors Network reported receiving fewer notices in the fourth quarter of 2011 than in the third, AND reported receiving fewer notices in the fourth quarter of 2011 compared to the same period in 2010.

While these numbers are encouraging, we shouldn’t lose sight of the fact that they still show that more 54,500 households continued to struggle with delinquent mortgages in 2011:

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Here's the breakdown for the number of preforeclosure notices received by members of the Homeownership Advisors Network in the 7-county metro area:

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As background, Minnesota state law (MN Statute 580.021) requires that the foreclosing party provide information regarding foreclosure prevention counseling services to the mortgagor (homeowner) and provide the homeowner’s name, address, and most recent known telephone number to an approved foreclosure prevention counseling agency before filing the notice of pendency.

Once the Minnesota Homeownership Center's network of foreclosure counselors receives notification from the lender/servicer/homeowners association, they then contact the homeowner, and track the number of notifications received during the month in their monthly reporting to the Center.

If you or someone you know is struggling with their mortgage payment, new programs, resources and assistance are becoming available all the time. Don’t give up… contact a foreclosure counselor that is a member of the Homeownership Advisors Network today to see if there’s help available for you to avoid foreclosure. Even if you’re not yet behind, now is the time to call. To find your local foreclosure counselor, click here.

Freddie Mac Announces Expansion of Mortgage Relief Program

2012-01-11T08:41:00.000-06:00

Earlier this week, mortgage giant Freddie Mac announced an expansion of its mortgage forbearance program to assist borrowers who are experiencing a financial hardship due to unemployment.

A forbearance is an agreement on the part of the lender or investor to withhold their claim to foreclose on a property - an agreement not to foreclosure for a set period of time.

According to Freddie Mac, their servicers can now offer eligible borrowers a short-term unemployment forbearance period of up to six months plus the possibility of an extended unemployment forbearance period if they remain unemployed for more than six months. (The six-month forbearance period is 'renewable' for a second six-month period, not to exceed a maximum of 12 months.) Under previous guidelines, the maximum period was six months.

In addition, this expanded program is now available for unemployed homeowners that are already performing under a HAMP or other loan modification program. If they continue to be eligible for HAMP or another loan modification program, they will be re-evaluated at the end of the forbearance period.

Freddie Mac has outlined some basic eligibility criteria for borrowers (the full criteria are available in their Single-Family Seller/Servicer Guide (Guide) Sections A65.26 through A65.28, here) that include:

Borrower must currently be experiencing an an unemployment hardship;
Borrower's current monthly housing expense-to-income ratio (excluding unemployment benefits) must be greater than 31%;
Borrower's cash reserves cannot exceed 12 months of their monthly housing expense;
Only a borrower's primary residence is eligible. Second homes and investment properties are ineligible.
The property cannot be vacant, condemned, or abandoned.

Effective Date
Freddie Mac has strongly encouraged its servicers to begin offering eligible borrowers the unemployment forbearance relief options as soon as possible, but are required to begin offering unemployment forbearance to eligible borrowers no later than February 1, 2012.

Are you struggling with you mortgage and like to know if an unemployment forbearance - - or other solution - - is right for you? In Minnesota, the non-profit housing counselors in the Homeownership Advisors Network are available to meet with you FOR FREE to help you with your options to avoid foreclosure. To find your closest counselor, visit the Minnesota Homeownership Center's website here.

Financial Assistance For Homeowners Displaced By Foreclosure

2012-01-06T11:32:00.005-06:00

Due to the success of a pilot program initiated in late 2009 and the generous support of the Otto Bremer and Target Foundations, the Minnesota Homeownership Center announces the availability of financial grants of up to $2,500 to help cover the costs of moving to alternative housing after a foreclosure. The goal of the grants is to assist Minnesota homeowners with the difficult transition from homeownership back into a rental situation, and to prevent homeowners that were unable to prevent the foreclosure of their home from becoming homeless.

The counselors of the Homeownership Advisors Network (housing counselors) are AMAZING at the work they do to keep homeowners in their homes whenever possible. However, foreclosure is inevitable for some families... and these grants allow the members of the network to keep a difficult situation from becoming a tragic one.

Currently, these grants, known as Re-Housing Grants, are only available to qualified homeowners in the City of Saint Paul and Dakota & Washington Counties. Interested homeowners should contact the Minnesota Homeownership Center for information on how to connect with a member of the Homeownership Advisors Network that is participating in the program. Teams established by these non-profit counseling agencies will help homeowners determine if they are eligible for one of these grants based on established criteria:

The applicant has not previously received a grant from this or a similar program.
The Foreclosure Sale has occurred and retaining ownership is unlikely and relocation is needed.
limited income and/or excessive but necessary expenses have prohibited the homeowner from saving enough money to secure alternative housing.
The full monthly rent payment in the alternative housing will be affordable, long-term, for the applicant.

Homeowners who are interested in learning more are encouraged to contact the Minnesota Homeownership Center at 651-659-9336 or by visiting www.hocmn.org.

UDPATE: Funding is available for the ENTIRE SEVEN COUNTY METRO! (Anoka, Carver, Dakota, Hennepin, Ramsey, Scott and Washington Counties). For information on who to contact, the Center has established a page on their website, here: http://hocmn.org/en/rehousing.cfm

Fannie Mae and Freddie Mac Eviction Moratoriums

2011-12-02T08:30:00.001-06:00

On Thursday December 1st, Fannie Mae and Freddie Mac both announced eviction moratoriums that will take place over the holidays. From December 19 through January 2, families living in properties where a Fannie Mae or Freddie Mac loan has been foreclosed upon will not be evicted.

NOTE: The legal and administrative processes for the evictions may continue during this time, but families will be able to stay in their homes. In addition, the GSE's will continue with the foreclosure process on delinquent borrowers during this time period as well.

Large mortgage servicers often follow suit – we will updated this blog if we learn of additional banks or servicers initiating moratoriums.

There are some nuances to the Fannie and Freddie moratoriums; additional details are available in the press releases here and here.

There is no "cold weather" rule regarding foreclosure or evictions after foreclosure in Minnesota. If you are struggling with mortgage payments or have questions about the process, contact a FREE non-profit Homeownership Adviser that specializes in foreclosure prevention TODAY. Waiting limits your options!

Southwest Minnesota Housing Partnership Awarded USDA Housing Preservation Grant

2011-11-14T10:09:00.001-06:00

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 http://www.swmhp.org/.

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: http://www.hocmn.org/en/rehab.cfm

Racial Disparities in Assets and Homeownership

2011-11-09T08:47:00.000-06:00

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.

Stripping Off Second Mortgages in Bankruptcy

2011-11-03T11:01:00.000-05:00

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!

Independent Foreclosure Reviews

2011-11-02T09:10:00.001-05:00

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:

their loan was serviced by one of the 14 servicers or their affiliates (see list below),
the property is, or was, their primary residence, and
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.

BE CAREFUL!!
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: http://www.independentforeclosurereview.com/

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
Beneficial
Chase
Citibank
CitiFinancial
CitiMortgage
Countrywide
EMC
EverBank/EverHome Mortgage Company
GMAC Mortgage
HFC
HSBC
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.

Fifth Annual EMHI Summit - Registration Open

2011-10-31T09:34:00.001-05:00

Exciting Changes This Year!

You're invited to join us for the 5th Annual Emerging Markets Homeownership Initiative Summit on Wednesday, December 7, 2011!

This year’s annual Summit reflects the dynamic field by hosting a variety of rapid learning stations for participants to gain valuable knowledge through several 15-minute sessions. We hope our new format for the event will make you better prepared to seize opportunities and confront challenges surrounding homeownership for emerging markets.

This year’s event will be fast-paced and informative for professionals looking for insight into the current status of emerging market homeownership in the State of Minnesota.

The morning session will begin with a keynote address from Dorothy Bridges, recently-appointed Vice President of Community Development and Outreach at the Federal Reserve Bank of Minneapolis.

Following the address, Summit participants will have the opportunity to rotate among various rapid learning stations hosted by leaders in the emerging market homeownership arena to get a snapshot of current issues and trends facing the industry. Stations will also be a time for participants to ask questions and gain best practice tips from leaders and colleagues in the profession. Some learning station topics include:

Financial Literacy,
Housing and Transportation Corridor Issues,
Minnesota Housing and Bond Programs,
Federal Housing Administration,
Demographics,
And MANY more!

3.5 hours of Real Estate CEU credits have been applied for.

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Want to dig deeper into homeownership and emerging markets issues?

This year we are also pleased to announce an optional afternoon session! We have invited Susan Didier, President of Thompson Associates, to teach her newly-developed course for the Minnesota Association of REALTORS® entitled, Emerging Markets: The New-American Homebuyer. Her course covers everything from cultural diversity issues such as language barriers and cultural values to explaining real estate in the real world, which highlights topics such as buyer readiness and special first-time homebuyer products. This afternoon course counts towards 3.75 hours of CEU credits.

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Last year's Summit sold out so register early!

http://emhisummit2011.eventbrite.com/

Preforeclosure Notices, 3rd Quarter - A Mixed Bag

2011-10-27T11:26:00.002-05:00

Preforeclosure Notices Send Mixed Signals for Housing in Minnesota

On Thursday, October 27th, the Minnesota Homeownership Center released its third quarter data on the aggregate number of Preforeclosure Notices received by foreclosure counselors in the Homeownership Advisors Network. The numbers continue to show that Minnesota is slowly emerging from the foreclosure crisis, while also signaling reasons for the state to continue to make fighting foreclosures a priority: the number of preforeclosure notices received in the third quarter of 2011 signals the first uptick in quarterly notices in a year.

In the third quarter of 2011, members of the Homeownership Advisors Network received 14,586 preforeclosure notices, 23% fewer than during the same time period in 2010, but an increase of 9% from the second quarter of 2011, when 13,372 notices were received.

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Most troubling is that 85% of the increase in notices from Q2 to Q3 came from the Twin Cities metro… with 43% of the increase coming from Hennepin County alone, which saw an increase of more than 500 preforeclosure notices. Is this a statistical outlier or the beginning of a troubling trend? The Minnesota Homeownership Center will continue to track these notices and will report on the Q4 and year-end numbers in early 2012.

The total number of preforeclosure notices received in the state of Minnesota in 2011 now exceeds 42,000:

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Here's the breakdown for the number of preforeclosure notices received by members of the Homeownership Advisors Network in the 7-county metro area:

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As background for new readers, Minnesota state law (MN Statute 580.021) requires that the foreclosing party provide information regarding foreclosure prevention counseling services to the mortgager (homeowner) and provide the homeowner’s name, address, and most recent known telephone number to an approved foreclosure prevention counseling agency before filing the notice of pendency.

Once the Minnesota Homeownership Center's network of foreclosure counselors receives notification from the lender/servicer/homeowners association, they then contact the homeowner, and track the number of notifications received during the month in their monthly reporting to the Center.

If you or someone you know is struggling with their mortgage payment, new programs, resources and assistance are becoming available all the time. Don’t give up… contact a foreclosure counselor that is a member of the Homeownership Advisors Network today to see if there’s help available for you to avoid foreclosure. Even if you’re not yet behind, now is the time to call. To find your local foreclosure counselor, click here.

HARP Changes - What We Know, What We Don't

2011-10-24T11:47:00.003-05:00

It is likely that President Obama will be announcing some major changes to the Home Affordable Refinance Program (HARP) on Monday, October 24th, 2011. The Federal Housing Finance Agency, the agency that regulates Fannie Mae and Freddie Mac as well as the 12 Federal Home Loan Banks throughout the country, has issued a press release outlining some of the important changes to the HARP program.

What We Know:

The goal is to prevent additional foreclosures by allowing additional underwater homeowners to refinance their mortgages at today's low interest rates and/or shortening the term of their mortgage.
Most importantly, the current 125% Loan to Value limit (LTV Ceiling) will be removed, but there is still a MINIMUM LTV of 80%. Borrowers that are underwater by any amount greater than 80% may be able to participate in HARP.
Borrowers fees to participate in HARP will be reduced.
To participate, borrowers must be current, have not been late on a payment in the last 12 months, and have a verifiable source of income. Actual affordability ratio (how much income needed) has not been released.
The new guidelines should waive the need for a full appraisal if a reliable Automated Valuation Model (AVM) is available on the property.
Participation in HARP is a one-time opportunity. If a homeowner has refinanced under the original HARP guidelines, they will NOT be able to refinance a second time under these new changes.
Only mortgages that are owned by the Government Sponsored Enterprises (GSE's), -- Fannie Mae and Freddie Mac -- will be participating in the new program. The mortgage must have been sold to Fannie Mae or Freddie Mac on or before May 31, 2009. To determine if your loan is owned by Fannie or Freddie, you can use the following links:

What We Don't Know

This blog post was written on Monday 10/24/2011... and many of the details may change over time. Please call a non-profit housing counselor for additional details about these HARP changes... or any other question you may have about your mortgage.

When will homeowners actually be able to refinance their Freddie Mac- or Fannie Mae-backed mortgage? Guidelines on the new program will be sent to lenders and servicers by November 15th. After that, the lenders/servicers will have to convert those guidelines into actual policies and procedures. This means that it may be mid-December or even early 2012 before a homeowner can actually participate. In addition, the concept of the program is complicated by the fact that certain servicers DO NOT ORIGINATE loans and may not have the capacity to originate the new HARP loan - without extensive (and time-consuming) changes to their internal systems. PLUS, as we've seen with the original HARP program, there may be inconsistencies from one servicer to another.
What will happen to homeowners in the following circumstances:

Multiple mortgages - second lien holders will have to agree to 're-subordinate' their loan to the newly refinanced loan. While there is no risk to the junior lien holders... we don't know which, if any, second lien holders will agree re-subordinate their mortgages.
Private Mortgage Insurance Holders - PMI holders have agreed to make the transfer of insurance from one loan to another easier... the details are still being worked out.

Once again... as the guidelines to servicers and lenders will not be available until November 15th... it will take several additional weeks for the lenders and servicers to convert those guidelines into policies and procedures, meaning that it may a couple of months before homeowners can access this new phase of HARP.

Reminder on Deficiency Judgments

2011-10-03T10:00:00.000-05:00

The Wall Street Journal published an excellent article this weekend on the dangers of deficiency judgments.

A deficiency judgment is “a judgment lien against a debtor, defendant or borrower whose foreclosure sale did not produce sufficient funds to pay the mortgage in full.”

In plain English: a homeowner can be sued for the difference between the amount the bank received when they auctioned off the house at the Sheriff’s sale, and the amount of the outstanding mortgages.

In the Wall Street Journal article, many of the former homeowners had purchased in Florida, where judgment can be sought on ANY mortgage deficiency. However, Minnesota is a ‘Non-Recourse’ state. This means that FIRST lien holders CANNOT seek judgment (cannot sue) former homeowners for outstanding funds*.

HOWEVER... any “Junior”, or "Second" lien-holders CAN. If there is more than one mortgage on the property – or if there is a line of credit or HELOC taken out against the property – THOSE lenders CAN sue the former property owner for payment of any outstanding debt.

Lenders can take up to SIX YEARS in Minnesota to decide whether or not to sue for any deficiency. In many cases, the lender won't be the ones seeking judgment. They'll simply sell the outstanding deficiency to collections companies, for pennies on the dollar, who will then be relentless in their efforts to collect.

One of the scariest quotes from the article comes from a representative of one of the collection agencies:

"We are waiting for the economy to somewhat heal so that it's a better time to go after people," says Douglas Hannah, managing director of Silverleaf.

The MN Home Ownership Center has a helpful fact sheet on its website about deficiency judgments. You can download the fact sheet here.

Deficiency Judgments are just ONE of the MANY considerations struggling homeowners need to think about when facing a possible foreclosure. If you, or someone you know is struggling with mortgage payments... don't wait until it's too late. To find your local non-profit, FREE Foreclosure Counselor, click here. For additional information about preventing foreclosure in Minnesota, click here.

* There are situations in which a homeowner can open themselves up to deficiency on a first lien. In a short sale situation, if the negotiations aren't carried out properly homeowners may unwittingly sign paperwork that allows the bank to seek judgement. This occurs when the bank is willing to release the lien so a short sale can occur, but does not release the underlying debt. Homeowners that are selling in a short sale situation need to be EXTREMELY careful about the documents they sign before selling.

Two Minnesota Housing Agencies Receive Expansion Grants

2011-09-29T09:19:00.001-05:00

NeighborWorks America invests in expanding services in Minnesota.

On Friday, September 23, NeighborWorks America announced$3.65 million in grant funding specifically designed for nonprofits to increasetheir services for underserved communities by expanding the geographic reach ofprograms that have already been successfully established.

NeighborWorks Americahopes this grant funding will help agencies with a track record of successfulprograms bring their initiatives to even more communities in need. Among the 25organizations receiving grant funds are two Minnesota-based agencies: SouthwestMinnesota Housing Partnership and Dayton’s Bluff Neighborhood Housing Services.

The Southwest MinnesotaHousing Partnership works to provide a sufficient supply of adequate, safe, sanitary and affordabledwellings for the people of southwestern Minnesota and is a member of theCenter’s Homeownership Advisor’s Network.

Dayton’s Bluff Neighborhood Housing Services provides owner-occupied rehab lending andconstruction management, homeownership education counseling, financial entryassistance, purchase-rehab-resale and new construction. Both of theseorganizations are making valuable contributions towards enabling successfulhomeownership for residents of Minnesota.

Congratulations to both organizations on receiving aNeighborWorks America grant to continue and expand your good work!

For moreinformation and a list of all 25 grant recipients, visit the NeighborWorksAmerica news site.

Foreclosure Counseling - NFMC Report

2011-09-28T12:00:00.000-05:00

Last week, NeighborWorks America released its 6th report to Congress on the National Foreclosure Mitigation Counseling program (NFMC). The full report is available here.

Once again, the most recent report shows that while foreclosures continue to impact the nation's housing market, foreclosure intervention/prevention counseling WORKS.

Here are just a few of the highlights from the report:

Homeowners who receive foreclosure prevention counseling are 70% more likely to cure their foreclosure than similar homeowners that don't receive counseling.
Counseling clients that received loan modifications were able to reduce their monthly loan payments an additional $260 MORE than homeowners that don't work with a counselor. The cumulative savings for struggling homeowners? More than $560 Billion (with a "B") dollars PER YEAR.

One of the interesting shifts highlighted in the report is the fact that, for the first time, a majority of the clients nationwide that sought foreclosure counseling (53%) hold fixed-rate mortgages with interest rates below 8%. In October of 2008... only 30% of homeowners were in the same situation. The foreclosure crisis in the U.S. is definitively no longer just a sub-prime issue. Over 60% of homeowners cite unemployment or underemployment as the primary reason they are struggling with their mortgage payment.

All of this information is very similar to the information we've seen in Minnesota. The Center's 2010 report on the foreclosure prevention counseling is available here.

Given that foreclosures in Minnesota have once again begun to tick upwards... it is vitally important that homeowners seek the help of a certified non-profit Housing Counseling agency when they're struggling with their mortgage. Do you know someone that's struggling to make their mortgage payment? Let them know about free counseling in Minnesota by having them visit: www.hocmn.org for more information.

Finally - Major Changes in the Mortgage Industry

2011-09-14T08:19:00.000-05:00

Major regulatory changes are shaking up the how servicers deal with delinquent homeowners.

The number one complaint the Center hears from struggling homeowners is how difficult it is to work with their bank or servicer. Common complaints include getting lost in overly-complicated voice-mail systems, being routed from one department to another, never being able to speak with the same agent or representative twice, and constantly being told conflicting information when speaking with different agents. However... a major change is on the horizon that should put an end to all this confusion:

The Making Home Affordable (MHA) program has updated their servicer guidance to require a “Single Point of Contact for Borrower Assistance”. In essence, the new guidance requires servicers to provide a single relationship manager to each struggling homeowner that is applying for help through the Making Home Affordable program or any other foreclosure-prevention option. This includes HAMP, HAFA, UP and any in-house modification MHA servicers may provide.

The relationship manager will be responsible for communicating with the borrower, tracking their documents, responding to inquiries and coordinating the communication with any other bank/servicer employees. Homeowners should receive notice about being assigned to a contact as well as a toll-free number to use and information about the preferred method by which they should send documents to the servicer. The guidelines state that the relationship manager must be a full-time employee of the servicer, not a sub-contractor, who should be fully trained on the MHA program and the other in-house loss mitigation options available to clients. Even if the client is not eligible for any loss mitigation options, and the loan is foreclosed, the relationship manager must still be available to the homeowner to answer questions about the status of the foreclosure.

It remains to be seen how well the servicers do implementing these changes, but this is good news for struggling homeowners AND their housing counselors.

Are you, or someone you know struggling with mortgage payments? FREE, non-biased housing counselors are available to help! Don't delay, visit www.hocmn.org to learn more about ways to avoid foreclosure in Minnesota.

HUD Extends Application Period for EHLP

2011-08-31T09:09:00.003-05:00

On Tuesday, the US Department of Housing and Urban Development (HUD) and NeighborWorks America announced that they have reopened the application process for the Emergency Homeowners’ Loan Program (EHLP).

EHLP offers an ‘emergency bridge loan’ (mortgage payment assistance) of up to $50,000 for qualified homeowners who have experienced an involuntary reduction in income (due to medical or employment issues) and are at risk of foreclosure.

Several thousand EHLP pre-applications were received during the original enrollment period in July. The majority of those did not meet the strict guidelines established by HUD and the Dodd-Frank Act. Because of the high disqualification rate, HUD anticipates that there will be funding available to reach additional struggling homeowners, and has decided give additional homeowners the opportunity to apply for these funds during an “Open Enrollment” period.

However, homeowners need to understand two key points about this new open enrollment period:

The strict qualifying guidelines still apply
Open enrollment requires a COMPLETE application and supporting documentation

The strict guidelines include (but certainly aren’t limited to):

90 days late as of June 1, 2011 and homeowners must still be at least 90 days late
Must have experienced a documentable reduction of 15% in their income due to the economy or a medical condition (involuntary layoff or wage reduction, for example)
No sheriff’s sale scheduled within the next 30 days

EHLP funds are provided to qualified homeowners on a first-come, first-served basis and it is critical homeowners provide all required application documents as quickly as possible, or they may risk losing the opportunity to apply for assistance. In Minnesota homeowners should submit all documents before 4:00pm on Thursday, September 15th and understand that as the September 15th deadline nears, there may not be enough time to review application documents. Submission of documentation does NOT guarantee that an application will be reviewed or accepted by HUD.

What should interested homeowners do?
Homeowners that are interested in applying for EHLP during the open enrollment period should contact their local Housing Counseling agency that is participating in open enrollment to see if they meet the strict program requirements and for information on how to apply.

Hennepin County residents, call Community Action Partnership of Suburban Hennepin at (952) 933-1993.
Carver, Scott & Washington County residents, call Carver County CDA at (952) 658-7878.
Dakota County Residents, Call Dakota County CDA at (651) 675-4555.
Residents of ALL OTHER MINNESOTA Counties, call LSS Financial Counseling at (800) 777-7419.

Additional information about EHLP and the strict eligibility requirements are also available on the EHLP Minnesota website: www.EHLPMinnesota.com.

Homeownership Issues & The 2011 Legislative Session

2011-08-03T07:48:00.000-05:00

This post is a guest post by Laura Hodges, AmeriCorps Member with the MN Home Ownership Center:

Click To Enlarge
(c) inspidlife (Used Under Creative Commons License)
http://www.flickr.com/photos/soaptrail/

2011 Legislative Update

The 2011 legislative session at times got hotter than a July weekend. Combining that with the government shut down, Minnesota citizens might have questioned if the politicians were getting anything done.

Well I am happy to report that lawmakers implemented two agreements during the most recent legislative session that offer additional protections to homeowners beginning August 1, 2011:

Mortgage Ownership Disclosure (Link)

This law updates an existing law that requires mortgage servicers to disclose to a borrower, upon request, who actually owns their mortgage loan and the contact information. While this may be helpful for homeowners, it is especially helpful for Homeownership Advisors (foreclosure counselors) when working with homeowners facing foreclosure as the knowledge of who really owns the loan can be helpful when negotiating workout options.

Extended Redemption Period for Reverse Mortgage Holders

The other change that was passed during the legislative session involves Reverse Mortgages. The law grants reverse mortgage borrowers, who have had a sheriff sale due to foreclosure, an extended redemption period of 12 months. This extension will give time for the homeowner to regain ownership if they can pay off the mortgage loan in full, or can be used as extended time to find alternative housing options. This change is welcome news for many reverse mortgage holders.

The Minnesota Homeownership Center would like to thank Laura for her valuable contributions to our work and mission over the past year. You've been a great member of our team, and we wish you the best as you move on to pursue other goals!

Court Ruling in Rochester May Affect Foreclosures in Minnesota

2011-07-19T09:17:00.000-05:00

When you think of Rochester Minnesota - you may think of the winding Zumbro river, the large IBM site or, of course, the Mayo Clinic. It's not often you think of Rochester as a setting for courtroom drama that may change the way banks and their attorneys handle foreclosures. However, a recent court decision in Olmsted County may do just that.

A foreclosure that had taken place in August of 2010 was ruled invalid by Olmsted County District Judge Jodi Williamson, because the Notice of Foreclosure Sale (Sheriff's Sale) was posted in a small newspaper in a neighboring township - not in a publication distributed in the area where the house was located.

The State of Minnesota requires that lenders notify homeowners of a pending sale by attempting to serve the occupant of the property with the Sale Notice (via local Sheriff or process server) AND publish, for 6 consecutive weeks, the date and location of the sale in a local publication.

According to housing counselors in the Rochester area, many attorneys use the smaller nearby papers due to the costs of publishing foreclosure notices in the Rochester paper. According to sources, the cost to publish a foreclosure notice in the Rochester Post Bulletin was the highest in the state.

If this ruling holds, it will mean that some foreclosures that took place in Rochester will be ruled invalid.

However, this won't be the end of foreclosures in Rochester as:

Many homeowners would have been notified via process server anyway, and
Most lenders will simply refile the foreclosure, obtain a new sale date from the Sheriffs Department and notify homeowners again, this time complying with the state statute.

It's still great to see that Minnesota is "ahead of the curve" when it comes to consumer protections under the law. Even when a bank must proceed with a foreclosure - if there are no other options - they must comply with the law.

If you're a homeowner struggling with your mortgage - don't wait for a legal ruling or hope for a legal loophole to avoid facing your foreclosure issue - non-profit (free) housing counseling is available throughout the state - including Olmsted County - to help YOU avoid foreclosure. Don't delay, visit the Minnesota Home Ownership Center's website HERE to find your local counselor.

New Video - Emergency Homeowners' Loan Program

2011-07-07T07:46:00.000-05:00

The Minnesota Homeownership Center has created a new video to assist consumers in understanding the new Emergency Homeowners' Loan Program.

As yesterday's post mentioned, under EHLP 1,405 selected (unemployed/underemployed) Minnesota homeowners will receive up to $50,000 in interest-free loans over the next two years to help pay mortgage costs. The loans are also 100% forgivable for homeowners who stay in their home for 5 years following the program’s completion.

The program can be a little difficult to understand, as it has very strict qualification guidelines and actually rolls out in several phases over the next few months. MN Housing and the MN Homeownership Center have created a website: www.EHLPMinnesota.com to try and outline some of the program guidelines and explain to consumers how the program works.

NOW, the Center has added a new video that explains, in seven short minutes, the basics of the EHLP program and how to apply.

Please feel free to share this video or embed it on your website! If you do share it, please let us know in the comments or by email: ed@hocmn.org.

Here's the video:

To link to the video from your site, blog or email, use: http://youtu.be/qtQ2NBlxYFE

To embed the video on your site, visit the link above and click on the "Share" button below the video.

New Foreclosure Prevention Assistance Program - EHLP

2011-07-06T07:33:00.001-05:00

Homeowners facing foreclosure due to involuntary unemployment, underemployment or medical issues are eligible to benefit from a new federal program: the Emergency Homeowners' Loan Program (EHLP).

The program is only accepting applications between July 5 & July 22. Under this program, more than 1,400 selected Minnesota homeowners will receive up to $50,000 in interest-free loans over the next two years to help pay mortgage costs. The loans are also 100% forgivable for homeowners who stay in their home for 5 years following the program's completion.

Homeowners eligible to apply for the federal program must meet several criteria, including:

Have faced an income decline of at least 15% due to involuntary unemployment, underemployment or medical issues
Have been unable to make their mortgage payment for at least 3 months prior to June 1, 2011
Reside in the mortgaged property

Unemployed or underemployed homeowners should visit the program's Minnesota website at www.EHLPMinnesota.com to learn more about the program, verify eligibility and download a pre-application.

Remember: The deadline to apply for this one-of-a-kind program is 4:30p.m. on Friday, July 22.

Homeowners are also being warned to steer clear of scams. There is no charge to apply for EHLP and checking eligibility and filling out the pre-application is simple. An offer to help fill out EHLP forms for a fee or anyone who guarantees that a pre-application will result in acceptance in the program in exchange for money is a scam.

Visit www.EHLPMinnesota.com for more information.

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CALL TO ACTION: Help Us Spread The Word!

If you know of unemployed/underemployed homeowners who are struggling with mortgage payments, we ask that you spread the word to them about this unique, and short-lived, opportunity.

Below you will find additional tools that you can use to help spread the word (Links to documents):

Fact Sheet for Professionals - Understanding EHLP (PDF)
A handout for consumers (PDF)
Email text that you can customize to your constituents/clients (MS Word)
Electronic newsletter or blog post text. (MS Word)

Maybe a link on your website? An email to friends/family or clients? A handout at the cash register or inserted into clients purchases? A blog post on your company or personal blog? WHATEVER! We'd love to hear about it! Post a comment about how you're helping, or visit our Facebook page and share your outreach ideas. THANKS!

Dodd-Frank Reform Act & QRM Impact on Minnesota

2011-05-24T13:57:00.001-05:00

Training for Housing, Lending & Real Estate professionals.

On Tuesday, May 24th, the Minneapolis/St. Paul Business Journal reported that, according the Federal Reserve Bank of Minneapolis, one in three banks in Minnesota are still struggling to recover from the foreclosure/financial crisis.

With this backdrop... Minnesota's mortgage lenders now face the uncertainties created by the implementation of the definition of "Qualified Residential Mortgage" (Section 941) of the Dodd-Frank Reform Act. This section of the Act will require all financial institutions that securitize mortgage loans to retain at least five percent of the credit risk, and proposes strict definitions for Qualified Residential Mortgages that can be securitized.

Two of the Minnesota Homeownership Center's partners, Minnesota Housing Partnership and Wells Fargo will be hosting two events offering affordable housing advocates, lending and Real Estate professionals the opportunity to learn more about the Dodd-Frank Financial Reform Act and how the definition of Qualified Residential Mortgages may impact affordable homeownership in Minnesota and the country.

Paul Weech, executive vice president for policy and member engagement at the Housing Partnership Network and expert on the Dodd-Frank Reform Act will be the featured speaker at both sessions.

Participants will learn about:

What does the definition of QRM mean for homeownership?
What is the perspective of Minnesota’s non-profit housing organizations, lenders & government leaders of QRM?
What opportunities exist to influence the final definition of QRM?

SESSION 1: Webinar
Date & Time: Wednesday, June 1st, 9-10am CST

SESSION 2: Live Panel Discussion
Date & Time: Thursday, June 16th, 8 - 11:30am CST
Location: Wilder Foundation, St. Paul, MN

To register (pre-registration required) or to learn more about the topics covered, visit the registration page here: http://qrmminnesota.eventbrite.com/

New Mortgage Disclosure Forms

2011-05-20T08:19:00.000-05:00

Share your opinion with the Consumer Financial Protection Bureau

It’s not very often that the general public gets to weigh in on items that will affect the entire mortgage industry. Recently, the Consumer Financial Protection Bureau (CFPB) released drafts of a new one-page (two-sided) mortgage disclosure form and is asking for YOUR opinion. The final form will combine the two mortgage disclosures that are currently required -- the federal Truth in Lending Act (TILA) mortgage disclosure and the Real Estate Settlement Procedures Act (RESPA) Good Faith Estimate -- into one two-page form, down from the current five pages.

While these forms are covered in-depth in the Home Stretch workshop, they certainly can be confusing for the average homebuyer, and the CFPB is asking the general public to offer their opinion on which of the two is easier for you (or your customers) to understand.

Both versions show the key loan terms like the interest rate, the monthly loan payment, any closing costs and taxes. Borrowers can quickly see how much they'll be paying per month, and, if the loan is adjustable, how those payments might change throughout the life of the loan.

Interestingly, the form also shows the Annual Percentage Rate (APR) paid over a five-year period, along with the amount of principal you will have paid off in five years (real equity).

The CFPB will be working on these forms until July of 2012, but over the next few months, the agency will be revising and re-uploading the form(s) on its site based on the input it receives.

So… go vote! Let your opinion be heard. Then come back and let us know which one you prefer in the comments. The two forms are available here.

When comparing the forms, we recommend that you focus on what information mortgage lenders and/or brokers should share with homebuyers to make the process as easily understood and transparent as possible. Remember… our goal at the Minnesota Home Ownership Center, and of our lender and real estate partners, is successful homeownership. Which form do you think will best help potential buyers in that respect?

Are you a Minnesota resident thinking of buying your first home? Do terms like TILA, RESPA and GFE sound like a foreign language? You can learn more about these, and many more, terms, the mortgage loan process and the best steps to follow to be a successful homeowner by taking a Home Stretch workshop. For more information, click here.

Single Point of Contact A Reality!

2011-05-19T07:46:00.002-05:00

Servicers must assign a "Relationship Manager" to every struggling borrower

Some exciting news was released by the administration of the Making Home Affordable program yesterday (US Treasury and Fannie Mae). By no later than September 1st, every struggling homeowner that applies for a loan modification under Making Home Affordable must be assigned a single point of contact - who must be an employee of the servicer with a direct, toll-free telephone number - for homeowners to be able to communicate with about their documents, their application and answer questions. This same point of contact, known as a Relationship Manager, will also be available for non-profit counselors to use when speaking with the servicer about a homeowner's situation.

Servicers have until November 1st to assign a Relationship Manager to EXISTING MHA Consumers. (Homeowners that are already in review or in a trial modification).

If implemented correctly... this should end a huge number of the complaints the Center hears from homeowners that are struggling with their mortgage: "I can never speak to the same person twice," "They lose my paperwork," "I've had to send in the same document 3 or 4 times"... etc.

According to the Supplemental Directive 11-04 for Servicers, released on May 18th:

The same relationship manager is responsible for managing the borrower relationship throughout the entire delinquency or imminent default resolution process, including any home retention and non-foreclosure liquidation options, and, if the loan is subsequently referred to foreclosure, must be available to respond to borrower inquiries regarding the status of the foreclosure.

For now, the Supplemental Directive will only be in effect for servicers that are participating in the Making Home Affordable initiative, and have a Program Participation Cap of more than $75mm. Basically, this covers the largest 20 servicers in the country... and hopefully smaller servicers will follow suit. Both GSEs (Fannie Mae and Freddie Mac) are currently exempt from this directive. In Minnesota, given the partnership between Fannie Mae, the Minnesota Home Ownership Center and the Homeownership Advisors Network, there is already a single point of contact through the local non-profit counseling agency.

Will this improve the MHA program? What other improvements do you think are necessary... leave us a comment and let us know what you think!

Preforeclosure Notices Drop 21% in First Quarter

2011-05-16T06:30:00.010-05:00

The beginning of the end of the foreclosure crisis in Minnesota?

Source: revjavadude

The Minnesota Homeownership Center has released its most recent report on the aggregate number of Preforeclosure Notices received by foreclosure counselors in the Homeownership Advisors Network and the numbers signal a possible light at the end of the tunnel for the foreclosure crisis that has affected the housing industry and Minnesota families for more than four years.

In the first quarter of 2011, members of the Homeownership Advisors Network received 14,595 preforeclosure notices, a drop of 21% from the same time period a year ago, and a 15% drop in the number of notices received last quarter (Q4, 2010).

This number reflects the lowest number received by counseling agencies since we started compiling the data in the first quarter of 2009:

Click To Enlarge

The drop in notices received by counseling organizations in the Twin Cities metro was equally dramatic. 8,836 notices were received, a 20% decrease over the same time period in 2010, and, like what we saw statewide, a 15% drop in the number of notices received last quarter:

It’s certainly too early to celebrate, as the number still means that almost 15,000 Minnesota families are still dangerously close to losing their homes to foreclosure and thousands of others are still struggling with their monthly mortgage payment. In addition, the most recent (Q1) Sheriff Sale numbers from HousingLink while down, still reflect numbers that are 400% higher than pre-crisis numbers. But it might be time to be cautiously optimistic that the very worst of the crisis is over. Remember, the housing crisis was a overwhelming painful for Minnesota and families involved and recovery will take MANY years.

If you or someone you know is struggling with their mortgage payment, new programs, resources and assistance are becoming available all the time. DON’T GIVE UP… contact a foreclosure counselor that is a member of the Homeownership Advisors Network TODAY to see if there’s help available for YOU to avoid foreclosure. Even if you’re not yet behind, now is the time to call. To find your local foreclosure counselor, click here.

For additional information about the statutory requirement for pre-foreclosure notices, visit the Office of Revisor of Statutes website here.

Foreclosure Moratorium in Minnesota?

2011-05-12T12:27:00.000-05:00

Disaster Areas in Minnesota Affected

On Tuesday May 11th, the Federal Government announced that federal disaster aid had been made available to Minnesota to assist with the state and local recovery areas from the spring storms and flooding that started back in mid-March and continues through today. While this means that Federal funding is available to state and local governments to help with protection and recovery efforts, there is also a housing-related issue that this National Disaster declaration puts into place: a 90 day moratorium on any foreclosure action on any FHA backed loans for consumers affected by the storms/flooding. (Fannie Mae and Freddie Mac and a handful of private lenders/servicers also have standing policies about halting foreclosures in Disaster Areas.)

The counties affected by the National Disaster declaration are: Big Stone, Blue Earth, Brown, Carver, Chippewa, Clay, Grant, Lac qui Parle, Le Sueur, Lyon, McLeod, Nicollet, Redwood, Renville, Scott, Sibley, Stevens, Traverse, Wilkin, and Yellow Medicine counties.

Remember, the moratorium and other tools that HUD has put in place for lenders (mortgagees) to use are only available to homeowners that have been DIRECTLY affected by the disaster.

In a clarification conversation the MN Home Ownership Center had with local HUD representatives in Minnesota, the word AFFECTED can mean:

Either the property itself was damaged or destroyed by the storms/flooding,

The homeowner’s income was affected by the flooding (their place of work or business is flooded, for example)

Affected homeowners who have an FHA-backed mortgage are instructed to call their lender to see what tools FHA has in place for helping with foreclosure avoidance following the disaster declaration.

In addition, the Homeownership Advisors Network is ready to assist ANY homeowner that is struggling with mortgage payments, especially those homeowners that have been affected by the spring storms.

Don’t delay, contact a foreclosure counselor that is a member of the Homeownership Advisors Network TODAY to see if there’s help available for YOU to avoid foreclosure. Even if you’re not yet behind, now is the time to call. To find your local foreclosure counselor, click here.

Dangerously Unprepared

2011-05-04T08:29:00.000-05:00

Buying a home without Home Stretch

Even after all of the news about the dangers associated with purchasing a home without being fully prepared, it appears as though the message still isn’t getting out to potential homebuyers. According to a newly-released survey from Zillow Mortgage Marketplace, a surprisingly high number of people don't understand the home buying process, especially the information about obtaining a mortgage, and may be making poor financial decisions as a result.

Those surveyed answered basic questions about mortgage information and terminology wrong almost half of the time. Forty-four percent of buyers admitted that they are not confident in their knowledge of mortgages or the mortgage process!

Other findings include:

About 77% of prospective homebuyers did not clearly understand what factors are involved in determining a mortgage interest rate, believing that annual income is an important determinant.
More than one-third (34%) of the respondents did not understand that lender fees are negotiable and that they vary by lender. They believe lenders are required by law to charge the same fees for credit reports and appraisals.
More than one-third (37%) of prospective home buyers who were polled believe that pre-qualifying for a loan means they have secured financing. The reality is that "pre-qualification" is used to describe an earlier step in the process when a lender or Homeownership Advisor approximates how much you can afford, but does not pull your full credit report or request any sort of documentation to verify the information you provide. A pre-qualification is NOT a pre-approval.

Before you start the process of making what may be the LARGEST PURCHASE IN YOUR LIFE, we highly recommend that you participate in a Home Stretch workshop. This is a class for potential homebuyers that is recognized nationally as a proven tool for preparing Minnesotans to be successful homeowners. There is an entire section of the Home Stretch workshop dedicated to fully understanding mortgage loan terminology, how to shop for a loan, how credit affects loan payments and how to avoid being taken advantage of when choosing a loan.

Year after year, Home Stretch participants report that help with understanding mortgages and the loan process was the MOST HELPFUL part of the workshop. In fact, NINETY-FIVE PERCENT of Home Stretch participants report that their participation in Home Stretch will help in the process of buying a home, and 98% would recommend the workshop to someone else. (For more information about consumer satisfaction with Home Stretch, view the most recent report here).

Are you thinking of purchasing a home in Minnesota? You can learn more about the mortgage loan process - - and the entire home buying process by taking a Home Stretch workshop. For more information, click here.

HECAT Request For Proposals Available

2011-05-02T09:04:00.000-05:00

As many of our readers know, the State of Minnesota is unique in that we are the only state in the country with a dedicated pool of funds that provides financial support to eligible non-profit organizations to deliver a variety of homebuyer/homeowner education, counseling and training services to Minnesotans. This dedicated pool is known as HECAT (The Homeownership Education, Counseling and Training Fund).

Some of the valuable services that are funded through HECAT include:

Pre-purchase education and counseling (Home Stretch),
Post-purchase education and counseling,
Home equity conversion counseling (Reverse Mortgages) and
Foreclosure prevention counseling

Funds for HECAT come from a public-private partnership of four agencies and organizations that are fully invested in ensuring that Minnesotans have access to the education and counseling tools necessary to achieve successful (sustainable) home ownership:

The Family Housing Fund,

Greater Minnesota Housing Fund,

Minnesota Housing (Finance Agency), and

Minnesota Home Ownership Center

Each of the four funding partners not only contribute financial resources they also actively participate in the grant-making process and provide technical assistance throughout the year.

The Request for Proposal (RFP) for funding for programs in 2011 and 2012 (funding year runs from October 1st through September 30th) is NOW OPEN. The deadline for applications is 5:00pm on Wednesday, June 1st. This is a STRICT deadline.

For more information about HECAT, or to view the RFP and even lists of award recipients from previous years, visit the Minnesota Housing website... here.

Partnership With Fannie Mae Launches In Minnesota

2011-04-27T07:00:00.002-05:00

There's an expression in Spanish that's usually used when describing politicians: "Los mismos perros, distintos collares" (Same dogs, different collars). Many homeowners struggling with mortgage payments have felt the same way about program announcements and offers of help they've heard during the housing crisis. "It may get headlines... but can it really get me help?"

Today, the Minnesota Home Ownership and Fannie Mae announce a partnership that really is a game-changer. This new partnership will accelerate the response time for struggling Minnesota families with loans that are owned by Fannie Mae.

Homeowners that are struggling with mortgage payments will meet with experienced foreclosure prevention counselors throughout the state that are members of the Homeownership Advisors Network to discuss their mortgage situation and determine options to avoid foreclosure. These counselors in turn will work directly with dedicated LOCAL Fannie Mae staff to find sustainable and affordable solutions for Minnesota’s homeowners.

As always... this assistance is FREE.

One of the unique aspects of this partnership has been the creation of a standardized document collection process for ALL possible loss mitigation options. Streamlining the documentation process reduces homeowner frustration and improves response times from servicers. No longer will homeowners have to submit (and re-submit, and re-re-submit) different versions of the same documents. This all happens ONCE - on the front end and with the assistance of a Foreclosure Counselor, and is then submitted electronically to Fannie Mae staff right here in Minnesota. Fannie Mae staff then leverage their relationships with lenders and servicers (as the investor) to find long-term solutions.

The Center knows that one of the greatest advantages to working with a certified non-profit Housing Counseling is that homeowners are more successful when they have access to information and the tools necessary to get a quick response to their mortgage situation. This new partnership takes this advantage to a whole new level.

The services offered through this new partnership are only for borrowers who have a mortgage held by Fannie Mae. Homeowners can determine if Fannie Mae owns their loan by visiting www.fanniemae.com/loanlookup or by contacting Fannie Mae (Toll-Free) at 1-800-7FANNIE. Homeowners who do not have loans owned by Fannie Mae are still encouraged to contact a member of the Homeownership Advisors Network to learn more about their individual options to avoid foreclosure or to learn more about the foreclosure process by visiting www.hocmn.org or calling us at 866-462-6466.

Plus: the Center will be launching this exciting new partnership with the assistance of Fox-9 news! Julie Gugin from the Center, and Jeff Hayward, Sr. VP from Fannie Mae, will be on the Fox-9 Morning Show from 7-9am on the Wednesday the 27th. Other Center staff will also be featured on both the 5:00 and 9:00pm newscasts. (Check us out after American Idol!) We'll update this post with links to videos as soon as they are online.

UDPATE: Here's the piece from this morning's Fox-9 news:

(If the embedded video doesn't work... click here to view on the Fox-9 Website.

Successful homeownership - There is a path

2011-04-20T15:42:00.002-05:00

Even though it might still be snowing, it really is spring in Minnesota and the only thing that appears faster than our potholes is the number of "For Sale" signs that pop up in front of homes across the state.

Thanks to our prolonged foreclosure issues... both prices and interest rates are low. Homeownership is more affordable now that at any other time in recent memory, and many people are thinking about becoming homeowners. Venturing into the world of home ownership can be VERY exciting! However, it can also bring some unwelcome surprises if you're not fully prepared.

Now, the Minnesota Home Ownership Center has prepared a new online tool that helps outline the path to successful homeownership.

Give it a try here, and let us know what you think in the comments!

If you're thinking about buying your first home in Minnesota... make sure you're on the right path - the path to successful home ownership. There is tons of helpful information on the Center's website about buying your first home including information about affordable mortgages, down payment assistance and finding someone to help you through the process. For more information, visit our website, here.

If you're not sure what YOUR path to successful homeownership should be... or would like to speak to a FREE non-profit Housing Advisor (Housing Counselor) about YOUR next steps... visit the Center's website to connect with the agency closest to you that offers these services.

6 Days Left To Pay Your Taxes

2011-04-12T08:26:00.003-05:00

2010 Taxes Are Due on April 18th

So… why are we talking about taxes on a HOUSING blog? It’s not just a simple reminder to pay your taxes - it’s a reminder that if you took advantage of the (up to) $7,500 “tax credit” on a home purchased between April 9th 2008 and July 1st 2009, your first repayment of that “tax credit” is due on your 2010 return.

Here’s a link to our original fact sheet (created in 2008, no longer available on our website).

Here’s the important text:

Homeowners will have to pay it back. While these funds have been labeled a tax credit, it's really a 15 year, zero interest loan that must be paid back in equal installments over 15 years, starting in the second year after the home is purchased. If you buy a house this year and claim a $7,500 credit on your 2008 tax return, you'll have to pay an additional $500 a year in taxes for 15 years, starting in 2010.

Time to start paying the piper.

The SECOND tax credit, which was a maximum of $8,000 for first-time buyers who purchased between January 1st, 2009 and April 30th, 2010 (last year’s tax credit) does NOT have to be paid back via your tax returns, unless you:

Sell the home within three years of purchase or the home is no longer your primary residence.
If you sell within three years, and the amount you make on the sale is less than the tax credit, you only have to repay up to the amount of the gain… not the full amount.
If you make MORE on the sale, or the home is no longer your primary residence, then you do owe the entire amount.

Confused? Many people are… so make sure you speak with a qualified tax professional if you have any questions about the Homebuyer Tax Credit(s) or any amounts you may owe.

Help With Foreclosure Postponement

2011-04-11T08:50:00.000-05:00

New online tool can help homeowners with foreclosure postponement

Minnesota is one of the only states in the country where struggling homeowners have the ability to legally postpone their foreclosure sale (Sheriff's Sale). Minnesota state law has allowed homeowners the right to delay their foreclosure sale on their home by five months (11 months in certain rural/agricultural areas) since mid-2009.

However, knowing the steps to take and how to fill out the legal documents necessary to postpone the sale has been an obstacle for many Minnesota homeowners. That changes today with the announcement that the Minnesota Legal Services Coalition, Southern Minnesota Regional Legal Services and the Minnesota Home Ownership Center have partnered on the creation of a free online tool that assists homeowners with the process.

How does it work?
The Foreclosure Postponement Tool, here, asks homeowners a series of simple questions, then automatically fills out the legal form they need, known as the "Foreclosure Sale Postponement Affidavit." Along with their finished form, users also receive a set of simple, yet detailed instructions on how to file the form properly. Once the form has been filed and the proper parties have been notified, the postponement takes effect. If you choose not to set up a username, the system will NOT save any personally identifying information... so you can be assured of confidentiality.

Should I postpone?
Before deciding to delay or postpone a Foreclosure Sale, homeowners should consult with a non-profit housing counselor that specializes in foreclosure prevention to understand the pros and cons of a postponement. To find your local foreclosure counselor, click here.

Make the Most of the Extra Time
After you've submitted the necessary documentation, and your sale has been postponed, what happens next?

Homeowners should start by finding a free, non-profit foreclosure counselor - while always staying wary of scams. Some web sites offer to "save your home" by charging premium prices for services that are available for free. To mitigate this problem, the Foreclosure Postponement Tool encourages users to contact the Minnesota Home Ownership Center. The Center offers referrals to reputable non-profit counselors via the Homeownership Advisors Network.

Try it out! www.LawHelpMN.org/ForeclosurePostponement

Foreclosure Scams Are Still An Issue

2011-04-07T08:16:00.000-05:00

BE CAREFUL OUT THERE!

On April 6, 2011, a coalition of fair housing non-profit organizations released their findings of a year-long undercover investigation of 80 "loan modification" (foreclosure rescue) companies, which reveals that the industry is rife with unethical, corrupt and even illegal practices. These practices include over-promising & under-delivering, charging fees for services that are available free from nonprofit organizations and even advising clients on how to commit acts of fraud against their lenders.

The report - which has a GREAT title: “Have I Got a Deal for You! An Undercover Investigation of Mortgage Loan Modification Scams,” was released by The National Fair Housing Alliance, the Connecticut Fair Housing Center, Housing Opportunities Made Equal of Virginia, Inc., and the Miami Valley Fair Housing Center. It documents some of the tactics mortgage modification scammers use to take money from struggling homeowners.

Here are just a few of the results of the report:

55% of the scammers required an upfront fee to start work or required a low initial fee to conduct minimal work on behalf of distressed homeowners, such as reviewing loan documents;
43% guaranteed or promised they could secure a loan modification even before learning about the homeowners’ financial limitations;
24% advised or encouraged homeowners to stop making their mortgage payments or to stop contacting their lenders;
16% guaranteed a new, much lower interest rate ranging between two and 6 percent on modified loans;
12% discouraged homeowners from seeking free help from government-approved housing counseling agencies;
8% encouraged homeowners to provide fraudulent information to their lenders.

The full report is available here.

None of these findings surprise us here at the MN Home Ownership Center. We hear from homeowners repeatedly that have spent money, lost time and been taken advantage of by less-than-scrupulous mortgage "rescue" operations. If you are struggling with your mortgage, THERE'S NO NEED TO PAY FOR HELP. There is a network of FREE, non-biased housing counseling agencies that can assist. To find your local non-profit foreclosure prevention counselor, click here.

For more information on what's being done in Minnesota to fight foreclosure rescue scams, visit the Center's "Look Before You Leap" website. You can help us fight these scammers in Minnesota!

Buying a Home With Someone?

2011-03-30T11:17:00.000-05:00

One of the best reasons to take a Home Stretch workshop is to be able to fully understand all of the terminology that is related to homeownership. This is especially important when closing on a property that you are buying with someone else... as a couple, family or just friends purchasing a property together.

In Minnesota when two or more people buy a home together they can choose joint tenancy or tenancy-in-common. The Minneosta Home Ownership Center has created a new Fact Sheet to provide an overview of both types of ownership.

Here's how it works:

Joint Tenancy
Joint tenancy is when two or more people own equal shares of a home. If an owner dies, ownership is transferred to the remaining owner(s).This is called the “right of survivorship.”

Tenancy-in-Common
Tenancy–in-common is when two or more people own a home. Ownership does not have to be equal. If an owner dies, ownership is transferred to the person(s) named in their will.

Tenancy-in-Common Agreement

When choosing tenants-in-common, a tenancy-in-common agreement is recommended. Agreements are usually written with the assistance of a real estate attorney.

The agreement generally includes:

The agreed to percentage of ownership for each owner.
A formula to determine the amount of each owner’s payment.
Consequences for an owner not paying their portion of the mortgage.
How property maintenance and the cost will be shared.
Restricting the sale or transfer of ownership without the consent of the other owner(s).
Acceptable reasons and the price to buyout an owner.
What happens if an owner declares bankruptcy or in the event of a death.

To view this new fact sheet, and other helpful information for first-time buyers, visit the Center's website here.

If you're thinking of purchasing your first home... and would like to learn more about the types of homeownership and lots of other important information, you should take a Home Stretch workshop!

More Warnings Against Scams

2011-03-24T15:40:00.000-05:00

The Huffington post has a great story up about the dangers that struggling homeowners face when they don't know where to turn for help, or when they grow frustrated trying to work with their lender: they become prey to scam artists.

The piece is here.

The Minnesota Home Ownership Center has additional information on avoiding scams on the "Look Before You Leap" (Avoiding Foreclosure Scams) website, here.

Here are some additional tips on how to avoid foreclosure rescue scams:

Don't fall for the lies that the scammers use to lure in homeowners: claims that they can save your credit, promise to find a buyer for your property or offers of free rent or gifts.
Don't EVER be pressured to sign a contract... especially if you don't understand something. If something sounds too good to be true, it probably is. Speak with an attorney or a certified foreclosure prevention specialist who can help review documents with you.
Don't EVER send your monthly mortgage payment to a third party or a mortgage 'rescue' company, even if they promise to forward those payments on, or hold them in a special account.
Don't rely on verbal agreements. Get everything in writing and keep copies of all documents, ESPECIALLY the ones you sign. This is good advise, but many of the homeowners highlighted in the HuffPo article had 'contracts' and those contracts were worth less than the paper they were printed on, so be very careful.
Don't sign any form or contract with blank spaces or blank lines.

Basically, we can sum up these scams in one line: no one that is struggling to pay their mortgage should have to pay to get help!

There is a network of FREE foreclosure prevention counselors available in Minnesota that are ready, willing and able to sit down with you to discuss your options for avoiding foreclosure. To connect with a foreclosure prevention counselor, click here. To learn more about the options available to Minnesota residents to avoid foreclosure, click here.

Housing Indicator - 2x4 Report

2011-03-15T11:14:00.000-05:00

The Minnesota Housing Partnership has recently released its updated report (known as the "2 x 4 Report") that studies two indicators for each of four key housing areas:

the home ownership market,
the rental market,
homelessness, and
the housing industry.

The report is a great resource for housing information, and is designed to provide a concise, easy-to-digest, graphic overview of the state of housing in the state of Minnesota.

The complete report is available here.

Focusing on the "Owners' Market" segment of their report, it's interesting to see that delinquencies fell slightly to 6.5% in the fourth quarter of 2010, continuing the downward trend that we've seen throughout the year.

Somehow... there is a disconnect happening that isn't easily explained:

In both 2008 and 2010 delinquencies were LOWER than 2009, but actual foreclosures (Sheriff's Sales) were higher in both 2008 and 2010. In reality, the delinquency rate maxed out at just over 8% in Q4 2009, but the highest quarters for sheriff's sales have been Q2-2008 and Q3-2010.

View the report... and add your 2-Cents in the comments.

Home Repair & Rehab Resources in Minnesota

2011-03-08T07:54:00.000-06:00

The Minnesota Home Ownership has created an easy-to-use resource listing affordable home repair and rehab assistance programs throughout the state of Minnesota. Programs included in the resource include:

emergency repair,
energy efficiency upgrades,
lead hazard abatement, and
general repair.

Some funds are direct grants to homeowners and others are loans, usually with below market interest rates or forgivable terms. The resource outlines dozens of programs available throughout the state and includes information on who to contact and how to apply.

Here's a sample of one of the Rehab loans (Zero interest, deferred for 20 years) available to residents of St. Louis, Lake and Cook Counties. There are several dozen other programs outlined in the printable resource:

Click To Enlarge

The complete “Home Rehab and Repair Matrix” can be viewed and downloaded, free of charge, from the Minnesota Home Ownership Center’s website here.

New Research on Foreclosures from Minnesota Housing

2011-03-07T09:35:00.000-06:00

Minnesota Housing, the State of Minnesota's Housing Finance Agency, has released its "Residential Foreclosures in Minnesota, Winter 2011" report. The data, on the delinquencies and foreclosures of residential mortgages in Minnesota, comes from LPS Applied Analytics.

The report provides information about key statewide trends on both delinquencies and foreclosures, and shows, using full-color maps, the foreclosure and delinquency hotspots around the state as well as information about changes in the number of delinquent and foreclosed loans in each zip code.

In addition, the appendices include two large tables that provide data for each residential zip code in the state... a plethora of information to dig through!

Here are some of their findings:

The state’s delinquency rate for residential mortgages has increased significantly over the last several years. Between the fourth quarter of 2005 and the fourth quarter of 2009, the percentage of mortgages that were at least 60 days past due quadrupled from 1.10% to 4.71%.1 On the positive side, the delinquency rate declined during all four quarters of 2010. By the fourth quarter of 2010, the rate was down to 3.43%, which is still very high by historical standards.
North Minneapolis and East St. Paul, like most areas of the state, experienced a decline in the number of loans at least 60 days past due.
The biggest increases in post-sale/REO loans were concentrated in the outer ring of the metro area and counties further out, including Rice, Le Sueur, Sibley, McLeod, Renville, Meeker, Benton, Kanabec, and Pine.

The full report is available here.

Fannie Mae's 2010 National Housing Survey

2011-03-03T10:28:00.000-06:00

Fannie Mae has released the findings of their latest National Housing Survey that polled homeowners and renters between October and December, 2010.

The Survey has some interesting facts and figures to digest:

65% of Americans believe that it’s a good time to buy a home. This is almost unchanged from last January, but down five points (from 70%) that thought it was a good time to buy in June (2010).
Just like last year… A large majority (78%) believe home prices have either bottomed or will rise over the next year. However, there have been price declines in most major markets throughout the U.S. over the past year (including here in Minnesota), meaning 78% of people polled in 2010 were wrong.
The percentage of those polled who believe buying a home is a safe investment has fallen six points to just 64 percent since last January’s report.

The Center believes that potential homebuyers should ALWAYS be cautious when buying their first home – and be VERY careful when hearing things like “Now is a good time to buy!” and “Housing is a safe investment!”… the “Crowd” may not aways be right.

When renters were asked why they wouldn’t purchase a home… their responses are revealing:

The #1 reason cited, by almost half of the respondents, was that they believe their credit was not good enough to obtain a mortgage.
In addition, the #2 reason, cited by 47% (multiple answers were allowed)… was that they don’t think they can afford both a mortgage and the upkeep of a home.

While the Center applauds renters that approach the idea of homeownership cautiously… there is a way to KNOW if your credit is good enough… and KNOW exactly how much you can afford to purchase – or if purchasing a home is even a good fit for you: We recommend you take a homebuyer workshop! In Minnesota, the state's premier homebuyer (pre-purchase) education curriculum is known as Home Stretch. To learn more about Home Stretch, and other services for homebuyers, visit the Center's website here.

For more information about the National Housing Survey and to see the complete report, visit Fannie Mae's website, here.

EMHI Lunch & Learn at the Federal Reserve Bank in Minneapolis

2011-02-28T09:11:00.000-06:00

The Minnesota Home Ownership Center is pleased to announce that the Federal Reserve Bank of Minneapolis will be hosting an upcoming luncheon training on:

The impact of, and response to, industry forces on homeownership in Emerging Markets

Speakers at the "Lunch & Learn" will include the President of the Federal Reserve Bank of Minneapolis, Narayana Kocherlakota, and Shana M. Ford, M&I Bank Vice-President and Branch Manager for the MN Region on Diversity & inclusion.

Tuesday, April 5th 11am – 1pm
Federal Reserve Bank of Minneapolis

EMHI, the Emerging Markets Homeownership Initiative, is a program of the Minnesota Home Ownership Center designed to increase homeownership opportunities for Minnesota’s emerging markets. The program grew out of the state’s EMHI business plan launched by Governor Pawlenty in 2004. The goal of EMHI is to promote parity in homeownership rates among Minnesota's diverse populations. For more information about EMHI or EMHI programming, visit the MN Home Ownership Center's website, here.

Foreclosure Prevention Counseling Works in Minnesota!

2011-02-24T08:27:00.000-06:00

The Minnesota Home Ownership Center has released its “2010 Foreclosure Counseling Program Report” that shows that over 12,000 homeowners sought the foreclosure avoidance services of the Homeownership Advisors Network in 2010 and more than half of all homeowners were able to avoid the foreclosure of their home.

At a time when several national news reports are criticizing the effectiveness of foreclosure intervention and loan modification programs, Minnesota once again breaks the trend! No other foreclosure avoidance program in the country can rival Minnesota’s success.

“Counseling services through our statewide network of nonprofit partners are providing meaningful outcomes for communities, lenders, local governments, and most importantly, Minnesota families,” said Julie Gugin, the Center’s Executive Director “We are pleased to report that more than 5,500 families remain in their homes today because of our counselors’ work.”

The report also provides a glimpse into the demographic and financial circumstances of struggling homeowners who sought help from mortgage counselors:

Click To Enlarge: The Face of Foreclosure in Minnesota

A PDF of the Infographic is available here.

According to the experiences of those seeking counseling in 2010, personal, mortgage and financial struggles are converging on many homeowners in Minnesota. The experiences reported by owners offer insights, such as:

Homeowners are balancing mortgages on less income. The majority of homeowners seeking help faced either a reduction in income (35%) or a total loss of income (25%) since first taking out their mortgage.
Mortgages have become unaffordable for many. Almost two-thirds of homeowners seeking counseling dedicated more than 30% of their monthly income to their mortgage – a recognized standard of an unaffordable mortgage. 24% of homeowners reported dedicating more than half of their income to their mortgage payment.

Minnesota experienced over 25,000 foreclosures in 2010 and this rate of foreclosure is expected to continue into 2011. As Minnesotans struggle with their finances amid current economic conditions, the Minnesota Home Ownership Center will continue providing free counseling and support to homeowners seeking help in managing their mortgage. The services are available for free through members of the Homeownership Advisors Network.

If you, or someone you know is struggling with their mortgage, you can connect with your local housing counseling agency here.

Payment Changes With a Fixed-Rate Mortgage

2011-02-09T12:49:00.001-06:00

I have a fixed-rate mortgage... but my payment just went up. How can that be?

This is one of the most common questions the Center receives from recent homebuyers who are wondering what's happening...

Are they being taken advantage of by their lender?
Has their loan been confused with someone elses?
Did they sign the wrong paperwork at closing?

Using the "Ask A Question" form on the Center's website... several homeowners asked this question, leading us to create a video podcast of the possible answers:

This short video, just six minutes long, gives an overview of how a monthly mortgage payment can change - even if someone has a fixed-rate mortgage.

This is the kind of information that is covered, in-depth, in the Home Stretch workshop. If you're thinking about buying your first home, think Home Stretch first.

If you've already bought your home... and have a question about your mortgage or your payment, feel free to contact a local housing counselor today!

Affordability: Wages and Prices

2011-02-08T10:13:00.002-06:00

This post is a guest post by Laura Hodges, AmeriCorps Member
with the MN Home Ownership Center:

Click To Enlarge
(c) inspidlife (Used Under Creative Commons License)
http://www.flickr.com/photos/soaptrail/

Can you believe we are here in 2011... three years into the worst financial crisis since the Great Depression! Last week a glimmer of hope was announced that joblessness dropped to 9%- the lowest in 2 years.

Although this news inspires hope, many times the national statistics don’t include local information – a community-by-community breakdown - which can led to some people feeling that the lack of sustainable housing and wages isn’t trickling down to their communities. But now there is an interactive, online tool that shares all of this information.

As you may know the Center’s commitment to successful home ownership is demonstrated in many ways including sharing relevant training for the Homeownership Advisors Network, and keeping updated on legislative issues that affect homeownership. As another show of this continued commitment Center staff attended the sponsored by the Minnesota Housing Partnership (MHP), Housing Policy Showcase on January 28th. Presenters included Mary Tingerthal, Minnesota Housing Commissioner, who spoke about her commitment to have Minnesota be a national leader on housing related issues, and Leigh Rosenberg, MHP Manager of Research and Outreach who presented on the connection between housing and wages.

Leigh also launched a valuable new tool that has been developed by MHP that gives a breakdown of housing and wages for every legislative district in Minnesota.

Follow the link and look for your district, and let us know how your district is doing…. http://mhponline.org/policy/policystate/legislative-district-profiles

If you’re not sure which legislative district you live in, click here.

-- -- -- -- -- --

If you'd like to communicate with Laura, she can be reached via email, here.

What does your home of the future look like?

2011-02-01T09:14:00.000-06:00

(Click To Enlarge)

Where do you want to live when you grow older?

For most of us, the answer is "at home." A new exhibition that opens on February 5th at the Goldstein Museum of Design looks at what a future “home” may look like as the population ages, and more of us decide we want to “age in place”.

The “Smart House, Livable Community, Your Future” exhibition, hosted by Housing Studies professor, and MN Home Ownership Center Board Member, Marilyn Bruin and Masters student Jodene Riha will explore the development of new products, technologies and design elements that will allow people to stay in their homes longer as they age.

The exhibition actually walks you through a home inhabited by fictional, 65-ish homeowners, Jim and Sarah, who have recently renovated their 1960s home so that they can continue to enjoy their active, engaged lifestyle. Visitors are actually encouraged to try out (hands-on) all of the items in the home. Visitors can sit in a power-lifted chair, handle easy-to-use-kitchen utensils, scoot around the kitchen on a wheeled chair to try out lower counters, operate an easy-open window, sit in a fully-adjustable desk chair at an ergonomically-designed desk, and observe wall colors and lighting that ameliorate the impact of changing vision. The bath will feature a walk-in shower and reinforced wall for grab bars. Visitors will learn about a Fall Guard alert system, auto-dispensers for medications, special environmental controls, and tools and technologies that allow Jim and Sarah to do the activities they enjoy and keep them connected to the world.

The exhibition runs from February 5th through May 22nd, 2011. There is an opening party being held on Friday, February 4th from 6-8pm at 241 McNeal Hall, 1985 Buford Avenue in St. Paul. For additional information, visit the Goldstein Museum of Design website here.

NEO: The Matrices Have Been Updated

2011-01-24T14:45:00.000-06:00

The Minnesota Home Ownership Center strives to provide information and resources that will assist Minnesotans begin, and maintain, home ownership.

In November of 2009 we introduced our "Entry Cost Assistance Matrix" that outlines the down payment programs, closing costs assistance and other funds available to first-time buyers in Minnesota. We've now updated the Matrix for the first quarter of 2011! To view the most recent version of the matrix, click here.

The Matrix is organized geographically, which allows readers to quickly find the area of the state that they are most interested in.

As a quick reminder, funding for down-payment assistance and entry-cost help is FLUID. The information may change. Please contact a program administrator to see if funds are available, and, if not, if there is a waiting list that you or your client can use to access funds in the future.

In addition, the Center has also updated its "Affordable Loan Product matrix". The Affordable Loan Product Matrix is designed to inform housing counselors and industry professionals of affordable mortgage loans and programs available to their clients.

Home ownership is expensive and first-time buyers should never base their home-buying decision on a down-payment program or access to a specific mortgage. There are MANY other factors when deciding whether home ownership is right for YOU or not. Before purchasing YOUR first home... take a Home Stretch Workshop (pre-purchase education workshop) to learn what's involved, and speak with a non-profit Housing Counselor to see if you might qualify for any down-payment assistance or other first-time buyer programs. For more information, click here.

Pre-Foreclosure Notices Increase 8% in 2010

2011-01-20T08:55:00.000-06:00

The Minnesota Home Ownership Center has compiled the pre-foreclosure notices received by the Homeownership Advisors Network (statewide network of housing counseling agencies) through the end of 2010 and the numbers continue to show that Minnesota households are struggling with mortgage payments even as other signs point to an overall improved economy.

For the year, the number of pre-foreclosure notices issued by foreclosing entities statewide increased 8% (Eight Percent) in 2010 over 2009, from 66,570 to 71,665. In the Twin Cities metro area, the number of notices received increased by 1,334, a 3% increase over 2009.

Homeowners in Greater Minnesota seem to be struggling more, as the number of pre-foreclosure notices issued increased FIFTEEN PERCENT. 3,761 more households received notice in 2010 (28,522) than in 2009 (24,761).

On a brighter note, the rate of increase has slowed and in the Twin Cities the trend has almost leveled off. Whether this signals a possible decline in pre-foreclosure notices to be received in 2011 remains to be seen.

Minnesota households received a total of 71,665 notices in 2010:

(Click To Enlarge)

Here's the breakdown for the number of pre-foreclosure notices received by members of the Homeownership Advisors Network in the 7-County Metro Area:

(Click To Enlarge)

However, the rate of increase appears to be slowing, especially in the Twin Cities Metro:

(Click To Enlarge)

The overall numbers make it hard to forecast anything but continued foreclosure activity and continued struggles for Minnesota families.

Minnesota State law (MN Statute 580.021) requires that the foreclosing party provide information regarding foreclosure prevention counseling services to the mortgagee (homeowner) AND provide the homeowner’s name, address, and most recent known telephone number to an approved member of the Homeownership Advisors Network- BEFORE filing the notice of pendency.

As always... if you, or someone you know, is struggling with your mortgage payments - or think you might fall behind soon - don't wait! There is a network of non-profit agencies that can help. Contact them today. For additional information about foreclosure prevention in Minnesota - visit the Center's foreclosure prevention resource page here.

Mortgage Success: Does the Bank Matter?

2011-01-06T10:08:00.000-06:00

New study from Ohio State University finds banking locally can impact mortgage success.

Researchers from the John Glenn School of Public Affairs at Ohio State University have found that low-income homeowners who received a mortgage from a local lender were less likely to default on their loans than those homeowners who borrowed from a more distant bank or mortgage company, even when these borrowers received the same type of mortgage product.

The researchers studied loan performance of more than 20,000 homebuyers who purchased homes AFTER the foreclosure crisis began (between 2005 and 2008). They examined the location of bank branches relative to where the homebuyers purchased their homes and found that higher-risk homebuyers with loans from banks with branches close to their new homes (less than 10 miles) were significantly less likely to default on their mortgages.

Can a personal relationship affect loan repayment?

As with large, non-local banks and many mortgage brokers, most local lenders base their lending decision on ‘the numbers’ like credit scores. HOWEVER, many local lenders place more weight on other factors, such as length of current employment, and whether you make regular deposits in a savings account.

“This kind of information may give a more complete picture of whether a person can really afford a mortgage, particularly for higher-risk borrowers,” said Stephanie Moulton, one of the researchers from Ohio State University.

“Some of the local bankers told me they won’t even look at a credit score until they have talked to an individual and determined if they think he or she can make the payments.”, she added.

The researchers believe that if there’s an existing business/personal relationship, the borrower may feel more obligated to make their payments, and the banks may provide more education and information to the borrowers, equipping them to be better homeowners.

The Minnesota Home Ownership Center truly believes that arming potential homebuyers with the ‘education and information’ that Moulton mentions is THE KEY to long-term successful homeownership. There is an entire chapter of the Home Stretch curriculum dedicated to helping potential homeowners navigate the mortgage loan process… including how to choose a lender and a loan product. For more information, visit the MN Home Ownership Center’s website, here.

$600k For Housing Counseling

2011-01-06T07:49:00.001-06:00

Homeownership Advisor Network Members Receive almost $600k in HUD Grants

The Minnesota Home Ownership congratulates members of the Homeownership Advisors Network who have received over $638k in funding from the U.S. Department of Housing and Urban Development (HUD). These funds will support the delivery of a wide variety of housing counseling services to help individuals and families in Minnesota improve their access to affordable housing, expand their homeownership opportunities, and avoid foreclosure and foreclosure rescue scams.

HUD Secretary Shaun Donovan stated, “Now, more than ever, it’s crucial that we support these agencies that are working with struggling families on a one-to-one basis to manage their money, navigate the home-buying process, and secure their financial futures.”

In Minnesota, the distribution of these funds will support:

ANOKA COUNTY COMMUNITY ACTION PROGRAM, INC (Blaine), $37,949.74
ARROWHEAD ECONOMIC OPPORTUNITY AGENCY, INC. (Virginia), $41,391.11
CARVER COUNTY COMMNITY DEVELOPMENT AGENCY (Chaska), $39,916.24
COMMUNITY ACTION DULUTH, $41,882.73
DAKOTA COUNTY COMMUNITY DEVELOPMENT AGENCY (Eagan), $61,882.73
LUTHERAN SOCIAL SERVICES/ CCCS OF DULUTH, $110,899.48
REVERSE MORTGAGE COUNSELORS, INC (St. Paul), $35,983.25
SAINT PAUL DEPARTMENT OF PLANNING AND ECONOMIC DEVELOPMENT, $89,832.47
TRI-COUNTY ACTION PROGRAM, INC. (Waite Park), $35,000.00
TWIN CITIES HABITAT FOR HUMANITY (Minneapolis), $35,500.00
WASHINGTON COUNTY HOUSING AND REDEVELOPMENT AUTHORITY (St. Paul Park), $62,865.98

Over $150k of the grant awards listed above were granted as Mortgage Modification and Mortgage Scams Assistance dollars that will be used by organizations to provide homeowners information about fair lending abuses and mortgage ‘rescue’ scams. Ed Nelson, spokesman for the Minnesota Home Ownership Center stated, “These funds will go a long way to helping the counseling agencies spread the word about dangerous, and costly, foreclosure rescue scams in Minnesota.”

The Homeownership Advisors Network is the State of Minnesota’s premier network of housing counseling agencies and is supported by the Minnesota Home Ownership Center. Members of the Homeownership Advisors Network are highly trained, certified professionals that provide advice and guidance for Minnesota families as they struggle to find and maintain stable housing.

For more information about the Homeownership Advisors Network or the statewide media campaign known as “Look Before You Leap” that continues to warn Minnesota homeowners to be on the lookout for foreclosure rescue scams, visit the Minnesota Home Ownership Center’s website at www.hocmn.org

In addition to the funds listed above granted to members of the Homeownership Advisors Network, other organizations in MN also received HUD grants:

CATHOLIC CHARITIES DIOCESE OF ST. CLOUD, $44,340.85
SOUTHERN MINNESOTA REGIONAL LEGAL SERVICES, INC. (St. Paul) 45,324
HOUSING PRESERVATION FOUNDATION (Supports National Network) $2.4mm

Stopping Foreclosure Scams: New FTC Rules Take Effect Today

2010-12-29T09:31:00.000-06:00

Beginning today, homeowners in Minnesota and nationwide are benefiting from the Federal Trade Commission (FTC)'s new consumer protection rules aimed at stopping foreclosure rescue scams. The Mortgage Assistance Relief Services Rule (MARS) bans companies from making false promises in their marketing and, beginning Jan. 31, prohibiting them from charging any up-front fees for their services.

We are all well aware that these terrible scams are robbing homeowners of their savings, their home, or sometimes both. This new Rule will further our fight to end foreclosure rescue scams in Minnesota by giving the FTC the tools needed to crack down on scamming companies across the country - companies that are targeting homeowners in our state.

In addition, MARS requires mortgage modification companies to disclose key information to consumers, including:

They must explicitly state that they are not associated with the government, and their services have not been approved by the government or the consumer’s lender;
The lender may not agree to change the consumer’s loan; and
If companies tell consumers to stop paying their mortgage, they must also tell them that they could lose their home and damage their credit rating as a result of this action.

For additional information about the new rules, and what it means for Minnesota homeowners, see our full press release, here.

While the new FTC Rule is an enormous consumer protection victory, homeowners still must be armed with information to recognize these scams and to protect their homes. That's why the Minnesota Home Ownership Center has created a brochure-size, two-sided consumer education piece for you to share with your networks and consumers. It equips homeowners with simple questions to ask themselves when considering outside help for a mortgage modification, and it directs them to www.LookBeforeYouLeap.org to connect with a counselor in their community.

Order Look Before You Leap Consumer Handouts Today!

Help us help Minnesota homeowners - commit to displaying this piece today! The consumer handout is the perfect size for brochure and information racks, tabling events, or including in utility bills or other mailings. We have produced materials in both English and Spanish. And, we'll provide you copies free of charge! Visit the campaign website: www.LookBeforeYouLeap.org to download and submit an order form.

Foreclosure Counseling Proven Effective - Again

2010-12-22T08:47:00.001-06:00

Back in November of 2009, the Washington Post had a headline proclaiming: "Counseling Helps Borrowers Avoid Foreclosure," citing a report of a study conducted by the Urban Institute of Washington D.C.

Now, thanks to a new report from NeighborWorks America on the "National Foreclosure Mitigation Counseling Program Evaluation: Preliminary Analysis of Program Effects," we can once again state that COUNSELING WORKS.

The National Foreclosure Mitigation Counseling (NFMC) program is a federally-funded program that is designed to support the rapid expansion of foreclosure intervention counseling in response to the nationwide foreclosure crisis. MN Housing (Finance Agency) has been a recipient of NFMC funds... that support the work of the MN Home Ownership Center's network of non-profit Foreclosure Counselors.

The analysis presented in the report is based on a sample of close to 180,000 loans held by homeowners that received NFMC-funded foreclosure prevention counseling. Here are just some of the findings:

The NFMC program was effective at helping homeowners cure an existing foreclosure. During the first two years of the program, the relative odds of counseled homeowners curing their foreclosure were 1.7 times greater than if they had not received NFMC counseling. The resulting difference in the cure rate means that an estimated 32,000 more NFMC clients cured their foreclosure by the end of December 2009 than would have occurred without receiving services from NFMC counselors.
Loan modifications received by NFMC clients resulted in significantly lower monthly mortgage payments than would have been received without the help of the program. Lower monthly payments may help reduce the likelihood of a subsequent recurrence of borrower mortgage problems. On average, we estimated that NFMC clients who received loan modifications in the first two program years reduced their monthly payments by $267 more than they would have without NFMC counseling.
Homeowners who obtained a loan modification that allowed them to cure an existing serious delinquency or foreclosure were much more likely to remain current on their mortgage if their loan modification was obtained with help from NFMC counseling. For clients counseled in 2008, counseling produced a 45 percent increase in the relative odds that a post-counseling modification would be sustained through 2009.

There are many more advantages to Foreclosure Counseling cited in the full report.

Here in Minnesota, research conducted by the Federal Reserve Bank of Minneapolis showed that Foreclosure Counseling cost just under $400 per household - $400 to save homeowners an additional $3,204 per year, improve their odds of curing foreclosure and increase the long-term success of a modification... plus many other 'intangible' benefits... seems like Foreclosure Counseling is a great investment in long-term housing stability for MN Families.

If you or someone you know is struggling with mortgage payments, help is available. Visit the MN Home Ownership Center's website for more information.

Shopping For A Mortgage

2010-12-15T09:15:00.000-06:00

According to a LendingTree/Harris Interactive survey released on December 14th, about 40% of recent home buyers obtained JUST ONE mortgage loan quote before purchasing their home.

According to the survey of just over 1,300 buyers, 70 percent of borrowers find shopping for a mortgage frustrating, citing the complexity of the terms as the number one reason people choose not to 'mortgage shop'.

The survey also reveals that although buyers recognize that their mortgage choice is a decision that will affect them financially for the next 15 – 30 years (or more!), nearly three-quarters (72 percent) of homeowners spent less than eight hours shopping for their home loan. Even more shocking? One in ten spent less than TWO MINUTES shopping for their loan.

In Minnesota... buyers have the opportunity to take a Home Stretch workshop, the homebuyer workshop recognized nationally as a proven tool to prepare homebuyers to be successful homeowners. There is an entire section of the Home Stretch workshop dedicated to fully understanding mortgage loan terminology, how to shop for a loan, how credit affects loan payments and how to avoid being taken advantage of when choosing a loan.

In a forthcoming report from the MN Home Ownership Center, Home Stretch participants reported that help with understanding mortgages and the loan process was the MOST HELPFUL part of the workshop. One more fact (just in case you're not convinced yet)... NINETY-FIVE PERCENT of Home Stretch participants reported that their participation in Home Stretch will help in the process of buying a home.

Are you thinking of purchasing a home in Minnesota? You can learn more about the mortgage loan process - - and the entire home buying process by taking a Home Stretch workshop. For more information, click here.

Update on Minnesota's Homeownership Gap

2010-12-13T11:10:00.000-06:00

This post is a guest post by Dr. Kim Skobba, a research and communications consultant that works with the Minnesota Home Ownership Center on Affordable Housing issues and housing policy. Dr. Skobba publishes her own blog at http://housing-sense.blogspot.com/

___________________________

Update on Minnesota's Homeownership Gap

At 73.7%, Minnesota maintains the highest overall homeownership rate in the nation. When it comes to the rate of homeowners of color, Minnesota does not fare as well. The rate of homeownership among emerging markets is 43.3% - representing the 5th largest gap in homeownership rates in the nation.

[Last] week at the EMHI Summit, Michael Grover (Federal Reserve Bank of Minneapolis) and John Patterson (Minnesota Housing) provided a summary of their research on trends in emerging market homeownership. Their analysis of American Community Survey and Home Mortgage Disclosure Act (HMDA) data identifies some apparent trends and offers a few unexpected findings.

The rate of emerging market homeownership declined for the first time since 2000. The rate of homeownership among emerging markets held relatively steady (at about 46.5%) during 2006-2008, which was surprising given the foreclosure crisis and what is known about its affect on minority homeowners. In 2009, the emerging market homeownership rate declined to 43.3%.
Some sub-groups of African Americans experienced particularly significant declines in their rates of homeownership. Those in the 45 to 54 age group saw a decline from 46% to 31% and those with a family income between $40,000 - $60,000 experienced a decline from a rate of 57% to 32%. Grover stated that more analysis is needed to make sense of these changes.
Minnesota Housing's affordable loan and entry cost assistance programs are helping emerging markets buyers. In 2009, nearly one-third of Minnesota Housing's loan originations were to emerging market buyers, compared to 10.9% in the overall market.
Subprime lending among emerging markets is on the decline. The rates of subprime lending (purchase and refinance) dropped from a high of over 40% in 2006 to well below 10% in 2009. Not much of a surprise but good news nonetheless.

The Emerging Markets Homeownership Initiative (EMHI) Summit is an annual event hosted by the Minnesota Home Ownership Center. This year's summit provided the opportunity to learn about the status of emerging market homeownership and some of the current issues facing emerging market homebuyers. Materials from this year's EMHI Summit (including the Grover and Patterson presentation) are available on the Center's EMHI webpage.

___________________________

This post was originally published on Dr. Skobba's blog: here.
Reposted with permission.

Filling the Foreclosure Funding Gap

2010-12-02T08:40:00.001-06:00

The Good News:
Minnesota Housing announced a $1 million award to the Minnesota Home Ownership Center yesterday during a press conference held at a foreclosed property on Saint Paul’s east side. The award comes at a critical time when federal funding gaps threaten the ongoing work of 74 counselors across the state.

Coverage of the press conference can be seen here (Fox-9), here (Finance & Commerce) and here (MPR).
UPDATE: Star Tribune has also covered us: here.

“We’ve come too far and invested too much in foreclosure prevention across the state to let this funding gap damage our efforts and the infrastructure we’ve built together,” said Dan Bartholomay, Commissioner of Minnesota Housing. “Minnesota has benefited from a strong, statewide network of foreclosure counseling agencies, counseling nearly 16,000 households in 2009, and we’re here today to make sure that continues.”

Here's the situation... the foreclosure counseling network in Minnesota faces an immediate threat to the provision of services, even while facing continued, and in some areas, increased, demand foreclosure prevention counseling. Current funding has been exhausted and the next round of federal funding will not be available until March 2011, pending congressional authorization.

“Minnesota Housing has demonstrated outstanding leadership throughout this prolonged foreclosure crisis,” added Julie Gugin, Executive Director of the Minnesota Home Ownership Center. “Their latest contribution will help ensure that tens of thousands of Minnesotans have access to quality, nonbiased services that will help them avoid foreclosure. Their partnership is critical to stabilizing housing and communities throughout Minnesota.”

With this $1 million award, the Minnesota Home Ownership Center is prepared to work directly with counseling organizations to continue services.

The Bad News:
Center staff has calculated that it will take just over Five Million dollars to cover the cost of maintaining foreclosure counseling services in the state of Minnesota at current levels through the end of 2011. We'll keep you informed about the fundraising process - and its impact on the counseling network over the coming months.

For now... services will continue without interruption and MN Homeowners that are struggling with their mortgage payments - or think they may have difficulty making payments soon, should contact a non-profit (FREE!) foreclosure counselor TODAY.

NEW Foreclosure Prevention Service Map

2010-11-30T09:01:00.000-06:00

Over the past few years of the foreclosure crisis in Minnesota, both housing industry professionals and social service agencies have requested an easy-to-use map of service areas covered by the Center's network of foreclosure counseling agencies... that they could print out and keep handy.

Now, the Center has produced a new printable map showing foreclosure counseling services provided by the Homeownership Advisors Network and the geographic or language service area they cover. This map is intended to be a reference tool for professionals as a supplement to the interactive online map.

(Click To Enlarge - Use Link Below For High Quality Print Version)

The map is available for download (print) here.

The same information is also available in an interactive format here.

There are also other resources (including fact sheets, presentations, newsletters and more) available for professionals that may be working with struggling homeowners at the Center's website here.

Foreclosure prevention counseling services are provided free of charge by nonprofit housing counseling agencies working in partnership with the MN Home Ownership Center. Remember: there is no need to pay a private company for these services! For more information an avoiding foreclosure, visit the Center's website.

Moving? Where are you going?

2010-11-23T09:05:00.000-06:00

I came across a great interactive map from Forbes the other day (yes, they published the map a few months ago... but the information is great). If you click on any county on the map it will show you the inbound and outbound movement for that county... including lines that show where people are moving to and from.

On the map... RED lines show the out-migration* from the county and in-migration* is shown in DARK GREY/Black for households that moved in 2008. While the data is a few years old... there's no reason to think that the trend would have changed too dramatically in the last year and a half.

As an example, here's the migration map for Ramsey County:

(Click To Enlarge)

If you want to see a REALLY scary picture... click on Detroit (Wayne County, MI).

The interactive map is here.

*NOTE: I've chosen to use the terms out-migration and in-migration instead of Emigration and Immigration... as those terms tend to refer to movement outside/into the country. The movements represented on the Forbes map show the movement of US residents only to and from OTHER US counties.

Center Board Member Recognized: Top Woman in Finance

2010-11-22T09:44:00.000-06:00

The Minnesota Home Ownership Center is proud to publicize the fact that Muffie Gabler, long-time Center board member, has been recognized by Finance and Commerce as one of only 50 “Top Women in Finance” in Minnesota. In addition, Muffie was chosen to join Finance and Commerce’s “Circle of Excellence” as she had previously been honored as a Top Woman in Finance in 2007.

The Top Women in Finance award is given to principals, partners, executive vice presidents, CFOs, CEOs and managing directors at not only financial institutions and lenders but also leaders of businesses small and large throughout Minnesota who have shown innovation, leadership, or some other notable qualities in the area of finance.

In addition to being one of the principal drivers of the creation of the Minnesota Home Ownership Center, Muffie has been an integral part of the Affordable Housing arena in Minnesota and countless affordable housing initiatives and community development projects would never have gotten off the ground without Muffie’s assistance.

Winners were recognized during a dinner and program on November 10th at the Hyatt Regency in Minneapolis. For a complete list of honorees, visit the Finance and Commerce article here.

Pre-Foreclosure Notices Continue Unabated

2010-11-18T11:48:00.001-06:00

The Minnesota Home Ownership Center has compiled the pre-foreclosure notices received by the statewide network of Housing Counselors through the end of the third quarter (September)... and the upward trend continues!

The most recent quarter (July through September) recorded the second-highest number of pre-foreclosure notices since the MN legislature enacted the notices in the third quarter of 2008. Year-To-Date, the total number of pre-foreclosure notices received has now exceeded 54,000.

(Click To Enlarge)

Here's the breakdown for the number of pre-foreclosure notices received by members of the Home Ownership Advisors Network in the 7-County Metro Area:

(Click To Enlarge)

NEW: For the first time since the Center started tracking and publishing the pre-foreclosure notice totals in June of 2009, we are now tracking the running quarterly totals of notices received to see where the trend is heading:

(Click To Embiggen)

This information makes it hard to forecast anything but continued foreclosure activity and continued mortgage difficulties for Minnesota families. As always... if you're struggling with your mortgage payments - or think you might fall behind soon - don't wait! There is a network of non-profit agencies that can help. Contact them today. For additional information about foreclosure prevention in Minnesota - visit the Center's foreclosure prevention resource page here.

Are HAMP Improvements Possible?

2010-11-18T08:47:00.000-06:00

On Wednesday, November 17th, MN Senator Franken joined 17 other Senators in sending a letter to Treasury Secretary Timothy Geithner asking for immediate changes to the HAMP program to help homeowners facing foreclosure.

The complete letter is here. (PDF Document)

Here are some of the key steps the Senator(s) recommend implementing in order to improve the HAMP program:

The creation of the Office of the Homeowner Advocate. This office would focus on assisting homeowners who believe their mortgage servicer is breaking the rules;
Provisions that would hold servicers accountable;
Automatically extend permanent mortgage modifications if trial modifications are completed successfully;
Revise eligibility requirements;
Ensure that servicers provide homeowners with necessary documentation; and
Provide homeowners with information as to why they have been denied HAMP modification.

The Minnesota Home Ownership Center applauds any and all efforts to assist struggling homeowners... and welcomes your comments as well!

Will Senator Franken's suggestions improve the HAMP program?
What improvements would YOU suggest to improve the HAMP program?
Do you have other suggestions for helping struggling MN homeowners?

Use the comments section to post your suggestions.

Fourth Annual EMHI Summit

2010-11-09T13:10:00.000-06:00

The Minnesota Home Ownership Center is pleased to announce that the 2010 Emerging Markets Home Ownership Initiative (EMHI) summit has been scheduled for December 8, 2010 at the Continuing Education and Conference Center on the St. Paul Campus of the University of Minnesota.

The Annual EMHI Summit is a hallmark of the Center’s dedication to the EMHI mission of working to promote homeownership parity. This year's Summit will bring together industry and community stakeholders to develop tools, resources, and best practices aimed at increasing homeownership opportunities for Minnesota’s emerging markets.

The agenda will include:

A welcome from MN Home Ownership Center Executive Director Julie Gugin;
Michael Grover, community affairs manager from the Federal Reserve Bank of Minneapolis, and John Patterson, director of research and evaluation at Minnesota Housing, will provide a comprehensive analysis of the current status of emerging markets homeownership in Minnesota. A traditional part of the EMHI Summit, this presentation will offer thought-provoking insight into the status of emerging markets homeownership and how the current economic environment has impacted effort;
Representatives from the industry, including Michael A Haley, of Identity Theft Shield, Nancy Hostetler of Open Door Home Loans (Bell Mortgage) and Roxanny Armendariz of Neighborhood Development Alliance will offer practical insights into client credit issues facing members of emerging markets. Discussions will include credit repair and Fair Issac scoring;
Keynote Speaker: Angela Glover Blackwell (Pending)

Angela Glover Blackwell is a national leader for social justice and equity. She seeks to strenghten America by creating stronger low-income communities and communities of color. A former Sr. vice president at the Rockefeller Foundation, she has appeared on Nightline, PBS's NOW, and is a frequent commentator on public radio's Marketplace and the Tavis Smiley Show. Her articles have appeared in the New York Times, the LA Times and the San Francisco Chronicle.

The Summit is designed primarily for realtors, lenders, non-profits, elected officials, and others working in the homeownership arena, but is open to all.

The Summit is FREE and 3.5 hours of Real Estate CEU credits have been applied for.

REGISTER TODAY: http://emhisummit2010.eventbrite.com

Are you on Twitter? Help Spread The Word! Use Hashtag #EMHI10 (EMHI TEN)

Foreclosure Data - Another Blow

2010-11-04T08:16:00.000-05:00

Lender Processing Services has released their most recent version of the LPS Mortgage Monitor, October 2010 Mortgage Performance Observations which contains an informative series of charts and graphs that show that while delinquent and foreclosed loans had stabilized somewhat at the end of 2009 and into the first half of 2010, new problem loans are once again picking up:

(Click To Enlarge)

The graph above shows loans that are currently 60 days or more delinquent but that were current just 6 months ago. You can certainly see the upswing that started in the middle of 2010.

The LPS report also has some, albeit limited, information regarding Minnesota. For example, in their table on the Delinquency and Foreclosure Rate, Minnesota ranks 42nd in the nation (that's a good thing!) in percentage of delinquent mortgages:

(Click to Enlarge)

According to the chart, our delinquency rate is about 34% lower than the national average of 9.27%.

Another chart that contains information about Minnesota shows that the average number of days delinquent for loans that are in foreclosure (time delinquent before foreclosure sale) has increased 85% since 2008, and now overages over a year - 386 days to be exact:

(Click To Enlarge)

Not only is it taking lenders/servicers longer to foreclose... the number of foreclosures is starting to increase again. This problem is NOT going to go away soon. Thousands of Minnesota families are still struggling every month to make their mortgage payments! If you, or someone you know is struggling... don't wait, contact a member of the Minnesota Home Ownership Center's network of foreclosure counseling agencies TODAY. The sooner you call, the more options you have available!

Vote Again!

2010-11-02T09:54:00.001-05:00

No... the Minnesota Home Ownership Center is not advocating voter fraud! :-)

We want you to vote on the consumer handout that we plan to produce for our Look Before You Leap campaign.

“Look Before You Leap” is a statewide public education campaign seeking to raise public awareness about the booming foreclosure rescue scam industry and its dangerous implications for struggling and unsuspecting home owners, and to connect struggling home owners with the Center’s network of FREE and trustworthy foreclosure counselors.

The piece we are designing will be used in mailings, handouts, counter displays, etc... and we hope to make the piece as attractive as possible so that struggling homeowners see the piece and respond.

Here are the two options:

(Click To Enlarge)

Would you take please take 30 seconds to respond to a quick on-line survey about the piece? 4 questions... 30 seconds... SURVEY HERE

You can also leave feedback in the comments! We'll be compiling this information through Friday, November 5th. THANKS!

What A Difference A Decade Makes

2010-10-21T11:43:00.000-05:00

I recently came accross a report from the Federal Reserve Bank of San Fransisco entitled "Underwater Mortgages" where the authors, John Krainer and Stephen LeRoy, attempt to determine the point at which underwater borrowers decide to throw in the towel and walk away from their homes.

While the article has some interesting information about the 'boiling point', I found that two of the images that accompany the report are just as interesting for people working in housing in Minnesota.

The first image shows the share of underwater mortgages in the fourth quarter of 2000:

(Click To Enlarge)

According to the figure, in the fourth quarter of 2000, Minnesota was one of only a dozen states where the share of 'underwater' mortgages was less than one tenth of one percent! (between 0% and 0.1%).

However, by fourth quarter 2009, our rate of negative equity homeowners had increased to between 6% and 10%:

(Click To Enlarge)

Interestingly... NO STATE was in the 0%-0.1% category by the end of the 'aughts'.

The complete report is here.

Residential Foreclosures in Minnesota Report

2010-10-19T09:10:00.000-05:00

Minnesota Housing has just released the Summer 2010 version of its "Residential Foreclosures in Minnesota" report, based on delinquency and foreclosure information from EVERY Zip Code in the state (through June 2010)... and there is a ton of great information for real estate and lending professionals, municipalities and elected officials and others that are working on foreclosure prevention and remediation efforts.

The report is available online here.

Here are just a handful of the highlights of the report:

Although the number of sheriff sales in Minnesota dropped from 26,000 to 23,000 between 2008 and 2009, the 2009 level is dramatically higher than the 6,500 sales that occurred in 2005.2 In addition, the number of sheriff sales started to increase again in late 2009 and early 2010.3 Sheriff sales are expected to rise back up to the 26,000 level in 2010.
Between 2007 and 2010, the subprime market’s share of residential mortgages in foreclosure dropped from 54% to 25% in Minnesota. During the same period, the prime market’s share increased from 40% to 60%.
There is concern about alt-A loans and option ARMs that will reset or recast in the next few years.

The report is full of great graphics that show exactly where the highest concentrations of delinquencies (60-day lates) and foreclosures are happening. Here is the map of loans that are 60-days or more delinquent throughout the state of Minnesota:

(Click To Enlarge)

From this map alone... it is clear that the foreclosure crisis is continuing to move out of the core cities of Minneapolis and St. Paul, and into the outer ring communities just outside the seven-county metropolitan area, particularly in Wright, Sherburne, and Isanti counties.

The report also maps the prevalence of REO properties and homes in foreclosure (as of June, 2010). In addition... the data is not just available in map form, but Minnesota Housing has included the information for EVERY Zip Code (where there are more than 200 residential parcels).

Go ahead... go dig through the report... let us know if you find anything that surprises you. Your comments are welcome!

Bank of America Halts Foreclosures in Minnesota

2010-10-08T13:10:00.006-05:00

According to a press release on the Bank of America website, BoA has halted ALL foreclosure sales in all 50 states. This, obviously, includes Minnesota.

The actual text of the press release is:

Bank of America has extended our review of foreclosure documents to all fifty states. We will stop foreclosure sales until our assessment has been satisfactorily completed. Our ongoing assessment shows the basis for our past foreclosure decisions is accurate. We continue to serve the interests of our customers, investors and communities. Providing solutions for distressed homeowners remains our primary focus.

The wording of their press release is interesting. It states that they will halt "foreclosure sales" until they've finalized their internal reviews... but it does not state anything about the REST of the foreclosure process. Will they continue all the steps PRIOR to the Sheriff's sale in Minnesota? (For an overview of the steps, view our Foreclosure Process Infographic).

Will other lenders follow suit? Let us know what you think in the comments.

We will continue to monitor the situation... and let our readers know of updates as they become available.

Struggling homeowners should be aware that this decision by Bank of America will NOT, ultimately, end their financial crisis. If you are struggling with payments - whether you are a Bank of America client or not, the best resource in Minnesota the MN Home Ownership Center's network of FREE Foreclosure Counselors. These counselors can work with you to find individualized solutions to YOUR personal mortgage crisis and answer questions about how foreclosure related policies and programs affect you. To find your closest counselor, click here.

UPDATE: We've received information from Bank of America... that specifically states that the ONLY part of the process that is halted is the actual sale date... and ONLY those sale dates that fall between October 9, 2010 and November 1, 2010:

First, I want to clarify that there is no moratorium in place. What we have done is postpone any scheduled foreclosure sales, that fall between 10/9 and 11/1 to a date after November 1st. This is to allow for additional time to complete necessary document reviews. All other foreclosure activity will continue as usual.

Housing Counselor Training Opportunity

2010-10-07T09:54:00.000-05:00

Homebuyer Counseling Training and Certification

The Minnesota Home Ownership Center is offering homebuyer counseling training and certification for housing professionals that provide pre-purchase counseling in Minnesota. This training will also help Real Estate agents that work with first-time homebuyers by sharing techniques, methods and practices to resolving any barriers that first-time buyers may have to homeownership.

Activities include determining mortgage readiness, prequalification, reviewing credit reports and many other key counseling/home buying components.

Participants interested in Continuing Education credits can pursue these through the "Self-Directed" option (Individual Continuin Ed Course Approval) through the MN Dept. of Commerce.

Participants interested in obtaining certification must complete the training and pass the in-class exam.

For additional information or to register, click here.

Can lender access property after foreclosure sale?

2010-10-04T14:40:00.000-05:00

This post is a guest post by attorney Jeffrey O'Brien, partner with Mansfield Tanick & Cohen, P.A. who specializes in the areas of business and corporate law, real estate law, estate and business succession planning and probate law.

___________________________

Can a Foreclosing Lender Enter a Property
During the Redemption Period?

In Minnesota, foreclosures work a bit differently than other states. Not only does Minnesota have a non-judicial foreclosure process (unlike most states which only allow foreclosures to be brought by court action), but Minnesota is also one of only ten (10) states that provides for post-sale redemption rights.

The most significant implication of a foreclosed homeowner having post-sale redemption rights (as opposed to pre-sale redemption rights) is that the foreclosure sale does not end the process. In a way, it is only the beginning. For the next six (6) months, Minnesota law allows the homeowner to stay in possession of the property, with the understanding that up until the end of the six (6) months, the homeowner could, theoretically, pay off the foreclosing lender’s mortgage plus the costs of the foreclosure and regain ownership of the property.

This post-sale redemption period can be tricky, for a number of reasons. For example, the lender is not able to list the property for sale, based upon the fact that the homeowner can redeem the property during that period, and allowing the lender to sell the property to someone else would create a significant ownership dispute, not to mention the fact that there would seem to be little to no market for purchasing a property that could be redeemed at less than the new buyer’s purchase price for a period of time. For this reason, if the homeowner abandons the property, the lender has the option to seek a court-ordered shortening of the redemption period to five weeks.

Even if the redemption period is not shortened, the lender is not powerless to protect its property. That’s because Minnesota Statutes Section 582.031 allows the lender, in certain circumstances, to enter the property during the redemption period and take steps to protect the property. The statute provides that “if premises described in a mortgage or sheriff's certificate are vacant or unoccupied, the holder of the mortgage or sheriff's certificate or the holder's agents and contractors may, but is under no obligation to, enter upon the premises to protect the premises from waste, until the holder of the mortgage or sheriff's certificate receives notice that the premises are occupied.”

Subdivision 2 of the statute goes on to clarify what actions the lender may take to protect the premises from waste: “install or change locks on doors and windows, board windows, install an alarm system, provide a resident caretaker, and otherwise prevent or minimize damage to the premises from the elements, vandalism, trespass, or other illegal activities.” For example, given Minnesota’s harsh winters, a lender may take steps to ensure that pipes don’t freeze and burst by winterizing the property.

In order to protect the homeowner’s redemption rights (which include the right of possession of the property until the expiration of the owner’s redemption period), if the holder of the mortgage or sheriff's certificate installs or changes locks, a key to the premises must be promptly delivered to the homeowner or any person lawfully claiming through the mortgagor, upon request.

Section 582.031 is a necessary result of Minnesota’s post-sale redemption rights, and lenders should be aware of their rights during the redemption period just as much as they need to be concerned about the homeowner’s rights.

___________________________

This post was originally published on Jeff's blog: here.
Reposted with permission.

For more information about your rights after a foreclosure sale - during Minnesota's Redemption Period - the Center has created a Redemption Period Fact Sheet, or you can visit the Center's website here.

HECAT Funding Awards Announced

2010-10-04T08:04:00.000-05:00

The State of Minnesota is unique in that we are the only state in the country with a dedicated pool of funds that provides financial support to eligible non-profit organizations to deliver a variety of homebuyer/homeowner education, counseling and training services to Minnesotans. This dedicated pool is known as HECAT (The Homeownership Education, Counseling and Training Fund).

Some of the valuable services that are funded through HECAT include:

Pre-purchase education and counseling (Home Stretch),
Post-purchase education and counseling,
Home equity conversion counseling (Reverse Mortgages) and
Foreclosure counseling

Funds for HECAT come from four funding partners that are fully invested in ensuring that Minnesotans have access to the education and counseling tools necessary to achieve successful home ownership:

The Family Housing Fund,
Greater Minnesota Housing Fund,
Minnesota Home Ownership Center, and
Minnesota Housing (Finance Agency)

Each of the four funding partners not only contribute financial resources they also actively participate in the grant-making process.

Additional information about HECAT can be found here.

A complete list of organizations that have been granted HECAT funds for the 2010-2011 program year is available here. (PDF Document)

Open Position - Dakota County CDA

2010-10-01T07:45:00.000-05:00

Interested in helping people begin or maintain sucessful homeownership? Looking for a new career?

The Dakota County Community Development Agency is seeking an experienced Homeownership professional to provide housing counseling services in the area of pre-purchase and mortgage default and foreclosure prevention.

Duties include: Conduct homebuyer education sessions; perform foreclosure program intake; conduct applicant interviews, determine eligibility, provide counseling services, respond to inquiries, and maintain records.

Starting salary: $3,284 - $3,542/mo. DOQ, plus benefits.

This position is grant-funded through September 30, 2011 with future employment dependent on continued program funding. Some evening and weekend hours may be required. Requires 4 years related education and/or experience; Certified Mortgage Foreclosure Prevention Specialist preferred.

Completed CDA application forms must be received in the CDA office by 4:30pm on October 20, 2010. You can use their online application process here: www.dakotacda.org, or call their Jobs Line at (651) 675-4441. The Dakota County CDA is an Equal Opportunity Employer

Foreclosure Suspensions in Minnesota?

2010-09-30T08:00:00.001-05:00

UDPATE: Bank of America & PNC have halted foreclosures in ALL 50 states, including Minnesota. If other lenders join them, we'll update this blog post.

Recently a number of stories have hit the media regarding certain servicers halting or suspending foreclosures due to issues (errors) with their internal document processing and legal procedures. The servicing companies that have voluntarily issued moratoria are GMAC and JPMorgan Chase, although many other servicers are reviewing their procedures, and others may follow suit.

The question has arisen as to whether these foreclosure suspensions/moratoria will affect any Minnesota homeowners. The short answer is: probably not.

The key reason is due to the fact that the vast majority of foreclosures in Minnesota follow a process known as Foreclosure by Advertisement, and not the process of judicial foreclosure (where a judge must enter a judgment of foreclosure against a homeowner before the house can be auctioned/sold). In Minnesota, no such step is required if the servicer is pursuing Foreclosure by Advertisement.

For more information about the Foreclosure by Advertisement process, the MN Home Ownership Center has created a fact sheet that highlights the steps a lien holder must take to foreclose. That document is here.

From the NY Times:

The lender, JPMorgan Chase, said on Wednesday that it was halting 56,000 foreclosures because some of its employees might have improperly prepared the necessary documents. All of the suspensions are in the 23 states where foreclosures must be approved by a court, including New York, New Jersey, Connecticut, Florida and Illinois. [Emphasis ours]

The Center will continue to monitor the situation, and if other servicers join the ranks of GMAC and JPMorgan Chase, we'll update the blog. In addition... if any servicers halt foreclosures in Minnesota, we'll highlight that information as well.

If you're struggling with your mortgage payments - no matter who your lender or servicer is - getting help as soon as possible is key. There is a network of FREE, non-biased, non-profit Housing Counselors that specialize in foreclosure prevention. To locate your closest counselor, visit the MN Home Ownership Center's website, here.

New Fannie Mae Forbearance Program for Military Families

2010-09-27T12:30:00.000-05:00

Fannie Mae has announced plans to give military families a break on their mortgage payments if they are struggling because of the death or injury of a service member.

Fannie says its "Unique Hardship" guidelines allow the agency to reduce or suspend borrowers' monthly payments up to six months. In addition, they will suspend reporting to credit bureaus for up to six months to minimize the impact on the borrower's credit score.

The military has established a special phone number for injured military or surviving spouses to use if they are struggling with mortgage payments: 1-877-MIL-4566.

If you or a family member are currently serving in the military... first and foremost: Thank You! Also, there may be other helps and assistance available to you - even if your loan is not backed by Fannie Mae. Contact a Foreclosure Counselor through the MN Home Ownership Center TODAY to learn about your options if you are struggling with mortgage payments. To find your local non-profit, FREE Foreclosure Counselor, click here.

Training Opportunities in Affordable Housing

2010-09-27T07:58:00.000-05:00

Need CEU's? Interested in Affordable Housing Issues?

As part of our goal of promoting and advancing successful home ownership in Minnesota, we periodically highlight training and continuing education opportunities for real estate and housing professionals. Today, we’d like to highlight three upcoming workshops/seminars:

1. 2010 Affordable Homes Congress
Attend the 2010 Affordable Homes Congress to get the answers and information you need to succeed in affordable housing today.
     When: October 14-15, 2010
     Where: Radisson Hotel and Conference Center Minneapolis
                 3131 Campus Drive, Plymouth, MN 55441
     More Info: Online information here
                           ** CEUs have been applied for**

2. Homes for All 2010
Homes for All 2010 seeks to build a community platform to affirm the belief that all Minnesotans deserve a safe, affordable place to call home; connect resources and stakeholders; and create sustainable communities.
     When: November 8, 2010
     Where: St. Paul RiverCentre
     More Info: http://www.homes-for-all.org/index.html

3. Fourth Annual Emerging Markets Homeownership Initiative Summit
The EMHI Summit event is designed primarily for Realtors, lenders, non-profits, government, and others working in the homeownership arena. Hear a comprehensive analysis of the current status of emerging marketing homeownership in Minnesota; learn from panelists and speakers about opportunities and successes in serving emerging markets.
     When: December 8, 2010
     Where: U of MN Continuing Education and Conference Center
     More Info: http://hocmn.org/en/emhi-summit-2010.cfm
           ** CEUs have been applied for**