Most actually go to system called MERS or Mortgage Electronic Registration System if you want to get fancy about it. They actually have their hands dipped in about 60 million home loans across the country.
Well about 10 months ago a group of people decided to sue to open up the information instead of saying Mortgage Electronic Registration to the name of the holder of note.
The Minnesota Supreme Court voted 6-1 in favor of MERS to keep the identity of the loan servicers nameless as they change hands numerous times.
The Problem With No Identity
When trying to track your mortgage, it’s hard because it was probably bundled up and sold so many times on the secondary market. Remember that document you probably signed with your lender at closing giving them right to package up, probably not but others don’t either. Making it difficult for home owners to try and figure out who to negotiate with.
When a home is foreclosed on, it has to be legally advertised in a newspaper for five weeks. You can find them under public notices in city or county websites or newspapers where the house is located. It’s public information so anybody can view it.
But instead of saying the residential mortgage servicer such as [insert bank name here], it says Mortgage Electronic Registration Systems.
I keep wondering on how all these real estate industry type and banking institutions get to keep every thing under lock and key. Funny how the big wigs behind this MERS are big banks like defunct Countrywide, Wells Fargo and Fannie Mae.
Read the full court ruling here in all it’s 33 pages.
]]>Some local neighborhood subdivisions have hit a wall as far as construction goes and for some borrowers with great credit it is next to impossible to grab a business loan.
Will have to get out to a few of the neighborhoods mentioned in the article and get some video.
Most definitely got over their head and this quote says it all from the article: “”Real estate is the cocaine of the banking business.” Hopefully lessons learned but will take years to recover.
From the StarTrib
In Minnesota, regulators have seized and closed two banks since 2008 and have ordered 16 others to clean up their balance sheets. Another 65 of the state’s 430 banks and thrifts are on a secret watch list, and state banking officials expect more to fail as they are pulled down by bad real estate loans.
No doubt small local banks bet heavy on commercial and residential real estate, often leveraging themselves to the point with hardly any assets on the books.
Minnesota Bank Failure Poll
If you haven’t already please read the article first, but based on predicted amount of closings… how many do you think will shut this year?
photo cred startrib
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CNN just released their best places to live in 2009 list and Chanhassen comes in at 2 on the list.
Last year Minnesota placed 7 in the top 100 but this year only managed to squeeze in 3 and none of the regulars. Actually none of the cities that made the list returned.
Cities to make the list:
Agree or Disagree? Would you add any to the list or replace the ones that are one there representing Minnesota. Take a moment and leave your comments below.
]]>Hopefully this will help a little bit, home buyers are still going to have to qualify to buy home and have down payment of at least 3.5%. A lot thing that it is only delaying the inevitable of home prices still falling. Locally, we already seen an uptick in pending sales compared to years past and this was before the $8000 home buyer tax credit was even announced. It will be interesting to gauge the effectiveness of this credit.
A breakdown of First Time Home Buyer $8000 Tax Credit
Of course there is provisions of the $8000 home buyer tax credit, most people will find out that they will qualify. Here is what is known (that could change once somebody goes through the fin print):
- Available to homes purchased between January 1st 2009 and December 1st 2009
- Maximum tax credit is increased to $8000 or 10% of homes value
- All owner occupied principal residences. This includes single family homes, Condos, Townhouses, Co-ops
- Income limits to single filed return of gross income no more than $75,000 or $150,000 joint return
- Do not need to refund the $8000 first time home buyer tax credit
- The tax credit is available to first time home buyers only and must not have owned a home within the past three years
- There is no recapture meaning that if you own the home for three years or more, then you don’t have to repay the tax credit due on sale. If you do sell the home without living in the home for three years, then there is a recapture of the tax credit paid on sale of the resident. Applied to homes purchased in 2009 only.
- Termination of the opportunity to use the $8000 tax credit is December 1st 2009
- Effective date is January 1st 2009
Applying for the credit should be fairly easy, just file your income taxes. If you have already purchased a home this year, then you file amended tax returns to receive the $8000 tax credit. For this just ask “the box” (if you used a computer program) or contact your tax professional to find out the next steps.
So there you have it, if you would like more information on the $8000 home buyer tax credit and are a first time home buyer in Minneapolis, St. Paul or surrounding Twin Cities metro area, then please contact me here. As always, make sure you consult your tax advisor on how this can help you. I am not a tax professional.
]]>In the Minneapolis/St. Paul foreclosure market, the local area came in ranked 59th in foreclosure activity, up 70% compared to 2007. Minnesota as a state came in at 26th, an increase of 75% compared to 2007.
]]>The outlook however still looks to be a bit on the shaky side, but optimism remains strong for some sort of stabilization in the second half. The biggest hurdle to overcome will be the job market because as everybody knows, No Job = No Home.
Didn’t Lower Rates Get Us Here
Yes and no, lower rates are great for first time home buyers that can handle the monthly payments. Recently lower rates have sorta thrown the housing market some sort of a temporary lifeline. Mortgage rates have been close to 50 year lows and no better time then now. It should also be known than just because you have good credit doesn’t necessarily mean that you are the right candidate to own a home.
One thing that has certainly come back into reach for first time home buyers in Minneapolis or St. Paul has definitely been the affordability of homes that have been at the lowest since 2004. Good for first time home buyers who may have been pushed out of the market back in the day.
What Will First Time Home Buyers Buy
Unfortunately this doesn’t bold well for the higher end homes of the market, sorry maybe next year. A part of me wants to think that first time home buyers will use much of their allocated money for a down payment, they will need to look at ‘turnkey’ properties that are ready to move in. Because of this little shift, sellers will have to recognize this and be willing to negotiate a fair market value.
Homes that distressed or bank owned foreclosures sometimes require a lot of work just to make them livable. More fixes means more out of pocket expenses to bring the property up to par.
I don’t believe townhomes will be to popular mainly because entry level single family homes will come back into reach for many buyers that are entering the market.
]]>Most Minnesota short sales are not successful these days and if you are going to do one, make sure it is done right. The best thing to do is make sure there is a pre-negotiated price that the lender will accept before the property is listed.
If a Minnesota short sale is going to be successful, certain elements need to come into play
- A hardship occurs and the homeowner has no way of being able to keep the property
- The obvious one is that the property is worth less than what is owed on the mortgage
- The lender then needs to contacted and be willing to do a short sale
- All materials (hardship package) are presented to lender to justify short sale
- Property is listed with real estate broker/agent and marketed
- Offer is made on a property and accepted by seller. Then approved by lender with a short sale package
No Proceeds
Because the house was a short sale, no proceeds will be given to the home seller. Make sure to check with necessary people for legal or tax implications.
]]>The map is interactive, zoom in or click on the houses to view the median price per area.
]]>Where does the Twin Cities real estate market stack up
The biggest bump in home sales can almost certainly be contributed to the ending of Down Payment Assistance Programs (DPA) that ended on October 1st. There was a rush to get all the loans closed up by September 30th or they would no longer be funded. So no big surprise there with sales being up.
Home prices fell 13.8% year over year from August 2008 to August 2007. The top 20 home markets where included in the report. Phoenix had the worst decline with 30.7% and Dallas had a 2.7% decline. No metro market was above water. The national average was a decline of 16.6%.
So What
So… are we close to bottom? Who the hell knows and if somebody tells you otherwise then they are flat out lying. What can be said is that inventory is shrinking and sales are inching up again. Prices are still falling but affordablity is coming back in to reach for certain buyers. Interest rates are still hovering around 6% and foreclosures along with lender mediated sales will continue.
If you can hold back on listing your property, it is for the best. We are still in for a bumpy ride.
]]>Make sure to get inside the house early to inspect the property before you place your bid. Public open houses are Saturday November 1st and 8th as well as Sunday November 9th. The houses are open from 11am to 4pm all days.
I have plans to be there. Let me know if you are going and we can meet up.
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