May Monthly Skinny – Video on the MN Housing Market

As the Minneapolis REALTOR video (The Monthly Skinny) reports, the Twin Cities housing market is feeling the effects of the end of buyer incentive in the form of tax breaks – but it’s simply balancing. Sings seem to point to a more normalized market for Minneapolis St Paul area.

Short Sales for Consumers

Home Affordable Foreclosure (HAFA) is designed to streamline short sales by providing a uniform process and standard forms, as well as incentives for families and their mortgage servicers to complete the process. It offers homeowners who sell their homes under HAFA $3,000 to help cover their moving costs. HAFA may be able to help you through the difficult process of selling your home and moving to another home.


There are some eligibility requirements:

• The property must be your primary residence.


• The first lien (your first loan on your home) must have been originated before January 1, 2009.


• The mortgage must be delinquent or default must be reasonably foreseeable.


• The current unpaid principal balance may not be more than $729,750 (there are higher limits for 2- to 4-unit dwellings).


• Your total monthly payment must exceed 31% of your gross income.

If you do qualify there are benefits:

• HAFA streamlines the short sales and DIL processes to make it easier for you to work with the servicer.


• You receive a check for $3,000 at closing to help with your moving costs.


• You will be fully released from future liability for your first mortgage debt (no cash contribution, promissory note or deficiency judgment is allowed). Also, any junior lien holder who accepts a HAFA incentive must also release you from future liability.

You can learn more from a informative brochure created by The National Association of Realtors.

Submitted by Minnesota Realtor, Mary Rugani.

Local Minneapolis St Paul Coupons

Looking for a good deal on a local restaurant or shop? There are a few great online resources that specialize in one great coupon a day and feature only (or at least mostly) local retailers. Here are three of our favorites:

• Groupon
• Living Social
• Twin Cities Daily Planet Deals

Beware the short sale

A short sale can seem like a good way out of a sticky situation – but tread carefully when considering putting up your property for a short sale. RIS Media reports that a short sale can hurt your credit rating for the long term…

“Both short sales and foreclosures are considered negative by the score, because our data shows us it’s very predictive of future credit risk,” Tom Quinn, Minneapolis-based Fair Isaac Corp.’s vice president of FICO scores, said. “The claim that doing a short sale is not going to hurt your score is false. It’s inaccurate.”

There are some exceptions…

That’s not to say that there aren’t some instances where short sales are better. If a borrower is current at the point of a short sale, for instance, then the consumer’s credit score won’t sink as far as it would have if he hadn’t made a mortgage payment for six months. Still, Fair Isaac says that the benefit from not having prior delinquencies on file pales when compared with the hit a score takes from a short sale.

Check out the article for more information on short sales and foreclosures, which can sometimes be a better decision.

Submitted by Minnesota Realtor, Mary Rugani

May Sales are Down

As predicted, housing sales have slowed since first time homebuyer tax credits have been discontinued. According to the Minneapolis Area Association of Realtors…

Pending sales in the Twin Cities metro area took a sharp turn in May -- from
5,183 signed purchase agreements in May 2009 to 3,910 signed agreements last
month.

The numbers were also down from previous months this year. While prices of homes was 6 percent higher – that increase has been attributed to a bump in prices of foreclosed houses. The median price of traditional homes declines, from $210,000 to $198,000.

According to a recent article in the Minneapolis Star Tribune…

Mark Vitner, a senior economist at Wells Fargo Securities, is among the camp who believe that we haven't seen the last price decline. In a recent housing research report, he said he expects prices to decline "a little further" through 2010 with a bottom being reached either at the end of this year or early next year. Once the prices reach their low, however, homeowners should only expect prices to rise "modestly," he wrote.

It’s not great news for sellers or for the overall economy – but for buyers it indicates that it’s still a buyers market. To make the most of that advantage, buyers will want to consider an exclusive buyer agents when they are looking for homes.

Submitted by Minnesota Realtor, Mary Rugani.

Special Provisions Allow Military Home Buyers to Capture Tax Credits

Thanks to NAEBA for the following notice...

Avondale, AZ – June 3, 2010 – Military families seeking to buy a home can count on a little tax help. The Homebuyers Tax Credit which provides eligible buyers with a tax credit of $8,000 for first time buyers and $6,500 for repeat home buyers ended on April 30, 2010 for civilians. However, active duty military or those on extended overseas duty have until on or before April 30, 2011 to have a binding sales contract in place. The bill also exempts qualified service members on official extended duty from tax credit recapture rules.

“We honor those who serve our country and are glad that this bill acknowledges the unique circumstances they face,” said Benjamin Clark, 2010 President of NAEBA (http://www.naeba.org/). “This bill ensures that members of the military have equal opportunity to participate in the homebuyer tax credit and offers relief to struggling military families by making the mortgage payment tax deductible.”

The Worker, Homeownership, and Business Assistance Act of 2009 provides a tax credit of up to $8,000 for qualified first-time home buyers purchasing a principal residence and a tax credit of up to $6500 for repeat home buyers who have owned a home for five consecutive years out of the prior eight years. The tax credit is available for eligible purchasers who have a binding sales contract in place by April 30, 2010, and close by June 30, 2010. However, realizing that members of the military, the Foreign Service and Intelligence Community have unique circumstances the bill has special provisions for this group:
· Tax credit extended for one year for military personnel serving outside the United States for at least 90 days during the period beginning December 31, 2008 and ending May 1, 2010.
· Eliminates the 36-month recapture requirement for military personnel, including members of the Foreign Service and intelligence community, forced to sell or move from a tax credit home as a result of an official extended duty of service.
Visit http://www.irs.gov/ for more information on qualifying and claiming the tax credit. To learn more about NAEBA and the benefits of using an exclusive buyer agent, visit http://www.naeba.org/.

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About NAEBA

The National Association of Exclusive Buyer Agents (NAEBA) is an organization of member companies dedicated to representing only buyers of real estate. To avoid conflicts, NAEBA member brokerages do not list homes for sale and never represent sellers. This restriction to one side of the real estate transaction ensures that the interest of home buyers is protected in every step of the real estate transaction, from house-hunting and negotiation, to inspection, financing and closing.NAEBA is pioneering a nationwide effort to give today’s home-buying consumers the level of service they deserve and are increasingly demanding. NAEBA members firmly believe that home buyers have the same full and equal representation rights as sellers in any real estate transaction. NAEBA, in existence since 1995, is comprised of Exclusive Buyer Agencies throughout the United States, and in some international markets.

Submitted by Minnesota REALTOR Renei Schmitz

Minnesota Top Drivers

Thinking about moving to Minnesota? Here’s something that you might not think to look into – but when you get here, it will matter. According to 2010 GMAC Insurance National Drivers Test survey, Minnesota drivers are among the nation's best.

The Twin Cities Business Journal reports…

Minnesota drivers scored an 81.1 out of 100 average, ranking the state fourth
nationwide. This is an improvement from a score of 79.7 and ranking of 11th in
2009.

The national average was 76.2 percent.