Minnesota Homes Today Local & National News

Minnesota HUD Homes! Great Option for Home Buyer’s and Investor’s*

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For the Minnesota homebuyer or investor HUD homes are a great option. 

* Buyers do not have to be low-income or first-time homebuyers to purchase a HUD home. Almost anyone can purchase a HUD home.

* If you have funds available or can qualify for financing, you may purchase a HUD home. 

 A HUD home is a one-to-four unit residential property acquired by HUD through the result of a foreclosure on an FHA-insured mortgage.  HUD has released their listing site called HUDHomeStore (www.HUDHomeStore.com).

 HUD’s entire inventory is listed for the public, brokers, state and local governments, and nonprofit organizations for a centralized location of information. HUD currently has the highest number of inventory of all REO properties.

Or Goto: Minnesota Real Estate

Bob Elliot – Realtor                  

25 Years Local Industry Experience

Short Sale, Foreclosure and Contract for Deed Comfort Level HIGH!

Adjustable-Rate Mortgages Starting To Adjust Higher

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ARM adjustments creeping higher

For the first time in a year, homeowners with adjusting mortgages are facing rising mortgage rates. The interest rate by which many adjustable-rate mortgages adjust has climbed to its highest level since September 2010, and looks poised to reach higher.

This is because of the formula by which adjustable-rate mortgage adjust.

Each year, when due for a reset, an adjustable-rate mortgage’s rate changes to the sum of fixed number known as a “margin”, and a variable figure known as an “index”. For conforming mortgages, the margin is typically set to 2.250 percent; the index is often equal to the 12-month LIBOR.

LIBOR stands for the London Interbank Offered Rate. It’s a rate at which banks lend to each other overnight.

Expressed as a math formula, the adjusting ARM formula reads :

(New Mortgage Rate) = (2.250 percent) + (Current 1-Year LIBOR)

LIBOR has been rising lately, which explains why ARMs are adjusting higher as compared to earlier this year. There has been considerable stress on the financial sector and LIBOR reflects the uncertainty that bankers feel for the sector. 

LIBOR last spiked after the collapse of Lehman Brothers in 2008 amid global financial fears. Analysts expect LIBOR to rise into 2012 because of bubbling concerns in the Eurozone.

Despite LIBOR’s rise, though, most adjusting, conforming ARMs are still resetting near 3 percent. For this reason, homeowners with ARMs in Minnesota may want to consider letting their respective loans adjust with the market.

This is because an adjusting mortgage rate near 3 percent may be better than what’s available with a “fresh loan” — even as 5-year ARMs rates make new all-time lows. Unlike a straight refinance to lower rates, an adjusting loan requires no closing costs, requires no appraisal, and requires no verifications.

So, if you have an adjustable-rate mortgage that’s set to reset this season, don’t rush to refinance it. Talk to your lender and uncover your options. Your best course of action may be to stay the course.

Everyone Lives In A Flood Zone. Are You Covered?

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Everyone lives in a flood zone.

Flooding is the top-ranked natural disaster in the United States, with a dozen potential causes ranging from heavy rains, tropical storms and hurricanes to new housing developments and rain after fire. Floods can occur in all 50 states and, when they do, they leave massive damage in their wake.

Flood damages exceed $2.7 billion annually.

As a homeowner, you carry homeowners insurance to protect against theft and loss. Typical homeowners insurance, however, excludes damages from flooding. Homeowners in Minneapolis , therefore, should make sure to have a separate flood insurance policy. And once that policy is in place, there are other steps you should follow, too.

First, make a log of your possessions, either on paper or by video. In your log, include everything that you own of value. Next, if you own jewelry, have it appraised and store the appraisal; if you own appliances, log the serial numbers and attach original receipts.

Then, buy a safe-deposit box at a bank, for example, and store your possession log. 

All of this information matters because, in the event you need to make a claim, you’ll have an easier time dealing with the insurance adjuster. It’s hard to prove possession of items that have been washed away by flood waters, after all.

You’ll also want to share this list with your insurance agent in advance so your policy is made with the proper amount of coverage.

Floods can strike anywhere and, as many people learn the hard way, standard homeowners insurance does not include flood coverage. If you’re without flood coverage, talk to your insurance agent about adding a flood policy.

Because many policies don’t take effect until 30 days from purchase, this is one form of insurance you’ll want to buy in advance.

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