Home Stretch: An “Insider’s” Perspective

This post is a guest post by Laura Grevas, Program Coordinator for the Minnesota Homeownership Center.

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Before I began working at the Minnesota Homeownership Center, I knew as much about the home buying process as your average twenty-something.

In other words, I didn't know much.

I knew that affordable homeownership is the cornerstone of thriving neighborhoods. I didn't know just how much I didn't know about buying a home. That’s why homebuyer education is so important. Buying a home is likely the largest purchase any of us will make in our lifetimes, so it pays to be prepared and have at least enough information to advocate for your family’s best interest.

Because the Center oversees a network of agencies that provide Home Stretch (homebuyer education) Workshops across the state, new employees are asked to join a class to get a sense of our flagship program.

The folks at Community Neighborhood Housing Service – one of more than 30 Home Stretch providers– were kind enough to let me sit in on a portion of their Saturday class in St. Paul.

Our facilitator began the afternoon session by talking about real estate basics, before introducing a local Realtor who schooled us in how and why people buy – or want to buy- where they do. Realtors aren't ethically allowed to steer their clients away from or toward certain neighborhoods, which is something I didn't know. The workshop format allows plenty of time to ask questions, both of the facilitator and the guest speakers, experts in their field who volunteer their time to teach new homebuyers. My classmates (the ones who were actually, you know, buying a house) swapped stories about their experiences so far, and I think we all learned something new.

My favorite guest speaker was the professional home inspector. With more than 20 years of experience, this inspector had seen some pretty major problems in folks’ prospective dwellings. In addition to teaching us how to find a reliable inspector and make the most of the inspection process, he shared some little-known home safety tips.

The average age of homeownership in Minnesota is 29, so we’ll see if that happens for me. Either way, I’m glad I observed this class – it definitely provides lots of valuable information that could prevent headaches down the road! 

Homeownership Issues & The 2011 Legislative Session

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

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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!

Update on Minnesota's Homeownership Gap

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/

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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.

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

Can lender access property after foreclosure sale?

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.

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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.

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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.