Celebrate Homeownership Month With Us!

The Minnesota Homeownership Center and the Homeownership Advisors Network are partnering with Minnesota Housing, MN Association of Realtors®, USDA Rural Development and the Minnesota Department of Commerce to promote homeownership and stabilize Minnesota’s neighborhoods by sponsoring homebuyer education in June.

In celebration of Homeownership Month in June, the Center is pleased to announce the availability of free homebuyer education.   This opportunity is available thanks to the generous support of several public and industry partners.

Quality homebuyer education is the foundation of successful homeownership and is key to stabilizing Minnesota’s neighborhoods.  A recent study conducted by Neil Mayer & Associates and the credit bureau Experian found that homeowners that receive pre-purchase education and counseling services are 30% less likely to become seriously delinquent on their mortgage in the first two years after closing.

In Minnesota, homebuyer education is available online and in-person.  Both courses include an in-depth understanding of the homebuying process, how to choose the right home, the importance of credit and good financial management, how a lender determines how much to lend, the importance of working with a real estate professional and the buyer’s rights and responsibilities once they become an owner.

Free in-person Home Stretch Workshops are available at participating locations throughout the state from June 22-29.

Framework, the most comprehensive online homebuyer education course available, will also be free to the first 100 customers who sign-up and use the special coupon code: MNPROMO13 

Mortgage Settlement Announced - What it Means for Minnesota

On February 9th, 2012, the Minnesota Attorney General’s office and the Department of Commerce announced that the State of Minnesota would be participating in the Federal Foreclosure settlement with five major lenders/servicers.  These five servicers have agreed to a $26 Billion dollar settlement, through which Minnesota borrowers may be eligible for up to $280 million.


The five lenders are: Ally/GMAC, Bank of America, Citi, JP Morgan Chase and Wells Fargo.  (Nine other servicers may sign on to the settlement later, we’ll update that information as it becomes available.)    It is important to note that loans owned or backed by Fannie Mae and Freddie Mac are not part of the settlement.  However, there are other programs and assistance available to some of these borrowers.  Click here for more information.


Additional information for homeowners interested in learning more about the settlement is available here: http://www.nationalmortgagesettlement.com/.  


REMEMBER:  DO NOT PAY FOR HELP.  No ‘agent’, ‘specialist’ or ANYONE should be charging you to ‘get access’ to the settlement.


WHAT DOES THE SETTLEMENT PROVIDE FOR MINNESOTA?  
Direct Payments to Borrowers.  Minnesota borrowers may qualify for financial compensation:

• Certain borrowers who lost their home to Sheriff’s Sale between the beginning of 2008 and the end of 2011, may be eligible for financial compensation of approximately $2,000* if they lost their home due to financial hardship AND 
• They were in the process of seeking a loan modification and the bank proceeded with the foreclosure anyway OR
• There were documented errors committed by the lender in the foreclosure process.

*The exact amount paid to homeowners will depend on the number of eligible borrowers who file a claim.


Refinancing Benefits. This part of the settlement allows underwater borrowers of mortgages owned by the five banks (as long as they are not backed by Fannie/Freddie) to refinance to a lower interest rate if they are current on their mortgage and have not had any late payments in the last 12 months.  The loan must have been originated prior to January 1, 2009, and have an interest rate of 5.25 percent or more. 


Principal Reductions and Other Relief. This part of the settlement will allow certain borrowers of loans owned, or in some cases serviced, by the five banks to qualify for:

• a principal reduction of their underwater mortgage and either 30 days late on the mortgage or who face ‘imminent default’;
• a forbearance  (set period of time with no mortgage payments) for unemployed borrowers, 
• short-sale assistance, 
• transitional housing assistance, 
• and other relief (details to be determined)

Beyond the financial relief and compensation outlined in the settlement, the five banks have also agreed to make substantial changes to their mortgaging and servicing standards including:

• Processing loan modification requests in less than 30 days
• Stopping the foreclosure process for homeowners who have a loan modification application pending (as long as the application is processed more than 15 days before the Sheriffs sale)
• Stopping the  foreclosure process completely for homeowners who are complying with a trial modification (either HAMP or the lenders’ in-house modification)
• Lenders must process requests for short sales (permission to sell the home for less than the outstanding mortgage loan amount) in less than 30 days.
• Lenders must assign a single point of contact to homeowners, or their foreclosure prevention counselor, who will be responsible for keeping the homeowner up to date with information about the loan, the modification process and any documentation needed.

WHAT HAPPENS NEXT?  HOW DO I APPLY?

• Over the next 30 to 60 days, settlement negotiators will be selecting an administrator to handle the logistics of the settlement and monitor compliance. 
• Over the next six to nine months, the settlement administrator, attorneys general and the mortgage servicers will work to identify homeowners eligible for the immediate cash payments, principal reductions and refinancing. Those eligible will receive letters directly from their lender/servicer.
• This settlement will be executed over the next three years. 

The exact details of how homeowners access the settlement are still being worked out.  There are steps you can be taking to make sure that you keep up to date with the settlement:

1. Contact a non-profit member of the Homeownership Advisors Network.  Foreclosure Counselors will know, as the details become available, the exact steps to take AS WELL AS know if you might qualify for any additional assistance or be able to access other programs to help prevent the foreclosure of your home.
2. Contact your lender.  If your mortgage is with one of the five current participants in the settlement, visit the National Mortgage Settlement website for links to the banks’ websites and contact telephone numbers.  

Even if your bank is not participating in the settlement, or they are, but your loan is backed by one of the Government Sponsored Entities, it is important that you take steps right away if you are struggling with your mortgage.  Contact a foreclosure counselor TODAY to learn about the WIDE ARRAY of programs, helps and assistance that are available to Minnesota homeowners.  Counseling is FREE and non-biased.  The sooner you call, the more options you have available, and remember, NEVER PAY FOR HELP!

Housing Counselor Training Opportunity

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.

What do I do if I've been scammed?

As homeowners continue to struggle with house payments… the Center and its network of non-profit Foreclosure Counselors continue to hear about homeowners who have paid companies (or "agents," / "brokers," / "representatives") to have their loan modified with no results.

While it seems as though the average fee is about $2,000 – $3,000, our counselors have encountered homeowners that have spent upwards of $12,000 (see our blog post here) all with little or no results.

For more information about avoiding these scams, the Center has produced a "Consumer Alert" fact sheet that you can view here. Bottom line: no struggling homeowner should have to pay to get help with their mortgage. It’s really that simple.

If you, or someone you know, has become a victim of a loan modification scam, there are a few steps that we encourages you to take:

1. Speak with one of Minnesota’s non-profit Foreclosure Counselors. They will be able to assess your situation and offer you the kind of help and assistance that the ‘fee-for-service’ organization promised, but couldn’t/didn’t deliver.
   
2. Gather as much supporting documentation as possible – name of company and agent/representative you spoke with, company address, details about when you talked to them, and especially: copies of anything you agreed to in writing, receipts of payment (cancelled checks, for example), etc.
   
   After reviewing your situation and documentation, your Foreclosure Prevention Counselor may decide to refer you to non-profit legal assistance teams for review.  Please note: there have been limited successes to date, especially due to the fact that many of these organizations are located outside of the state of Minnesota. Our legal partners have found that the company or its agents never reply to demands for repayment - they suspect they just sets up shop under another name. However, if the company is local and as homeowner you are willing to pursue further action, they may be able to do more, including actions with the MN Attorney General’s Office and even suing the organization or agent.
   
   
3. File a complaint with the Minnesota Attorney General’s Office. Minnesota’s "Foreclosure Consultant law" was updated last year to include loan modification services, and that law prohibits charging an up-front fee before services are performed. The AG is a central office for compiling complaints and has the most power to act. The AG has a complaint form on their website here.
   
4. Use the Minnesota Department of Commerce website to look up whether a company is licensed for mortgage loan origination (Follow the "License Look Up Tool" link on the right-hand side of this page). By law, companies that provide mortgage modification services must be licensed by the state and often times are not. If they are not licensed, the Commerce Department may be able to fine the company and force them to get licensed.

Remember: there is NO NEED to pay for foreclosure-prevention services in Minnesota. There is NOTHING a fee-for-service company can do that our network of Foreclosure Counselors can’t. And more often than not… these fee-for-service companies are SCAMS. Be careful out there!

FTC Shuts Down Scam Loan Modification Companies

The Minnesota Home Ownership Center has warned - and will continue to warn - Minnesota consumers about the number of for-profit loan modification companies that are beginning to make their appearance in Minnesota.

NOW, we've received notice that the Federal Trade Commission (FTC) has shut down a number of Loan Modification Companies that were taking advantage of homeowners throughout the country, by falsely claiming to be a part of the HOPE NOW Alliance.

The complete story can be found at the FTC's website, here.

THESE ARE ONLY A FEW OF THE DANGEROUS ORGANIZATIONS LOOKING TO SEPERATE HOMEOWNERS FROM THEIR HARD-EARNED MONEY.

The Minnesota Department of Commerce requires that anyone who engages in the work of loan modifications... attorneys, loan officers, lenders or private individuals... have a residential mortgage originator license pursuant to Minnesota Statutes Chapter 58.

According to the state of Minnesota... individuals offering or negotiating loan modifications are indirectly acting as mortgage originators. Additional information can be found here.

SO… if ANYONE offers to assist you with a loan modification, PLEASE check their license status with the MN Attorney General’s office FIRST.

BUT, WHY PAY FOR SOMETHING, when BETTER services are available free of charge? If you think a loan modification may help keep you in your home, please contact one of our FREE non-profit foreclosure prevention specialists for help.