Foreclosures VS Shortsales....

Buying a foreclosure or short sale can be complex. Because each situation is unique, understanding the buying process is critical. Short sales, foreclosures and lender owned properties can be classified as non-traditional home sales. While they may provide the opportunity to buy real estate at reduced prices, these types of sales are complicated and take longer than traditional real estate.

Short Sales: The seller is asking their lender(s) to agree to take less than the amount owed on the home as payment in full. It’s considered a short sale when the sale price is insufficient to pay off the total mortgage(s) and costs of the sale. Contrary to its name, a short sale can be one of the most time consuming types of real estate transactions because the seller and lender(s) must agree to the terms of modifications of the seller’s mortgage obligations.

In Foreclosure: Properties in foreclosure represent an owner who has missed one or more mortgage payments and has received an official notice of foreclosure from their lender. Lender Owned, Once the foreclosure process is complete, the property becomes lender owned. The seller is now the bank and the home is vacant. Things to Consider: Non-traditional home sales are more complex and potentially more time consuming because the lender is heavily involved in the transaction – either acting with approval powers or as the owner/seller. Foreclosed properties may be previously owned by people experiencing financial difficulties and may require costly updates and repairs. Liens or back taxes often create challenges with the property's title. When entering into this type of real estate transaction, it’s critical to work with an expert who understands the market and can help you navigate the process. To learn more about buying a short sale or foreclosure contact Traci or Eryn!

Tax Credit Extended and Expanded!

BREAKING NEWS!
Tax Credit Extension & Expansion is Approved!
President Obama has approved a bill for the Housing Tax Credit Expansion and Extension. Here’s what it means:
The $8,000 First-Time Homebuyer Tax Credit is Extended!
Now, qualified first-time home buyers would receive their $8000 tax credit if they sign a purchase contract by April 30, 2010 and close by June 30, 2010.
The home purchased must be their primary residence
Buyer cannot have owned a home during the past three years
Tax credit is up to 10% of the home value (not to exceed $8,000)
Annual income caps to qualify for the tax credit have increased ($125K for single filers / $225K for joint filers). Partial tax credit can be granted for incomes up to $145K for single filers / $245K for joint filers.
　
PLUS New $6,500 Tax Credit for Current Home Owners Purchasing a Primary Residence
Eligible home buyers must have lived in their current home for 5 consecutive years of the past 8 years.
The new home does not have to cost more than the old home.
Eligible for homes with purchase agreements signed between November 6, 2009 and April 30, 2010, and close by June 30, 2010
Annual income caps to qualify for the full tax credit are $125K for single filers / $225K for joint filers. Partial tax credit can be granted for incomes up to $145K for single filers / $245 for joint filers.
Changes Chart and FAQs from www.realtor.org (National Association of Realtors® website) are attached.

Spring housing market off to a strong start!

There's an upside to the nation's housing glut, fed by the crush of foreclosures: Housing gets more affordable.

In Minnesota, closed home sales were up 14.25 percent from one year ago, as indicated from the 13 county metro housing statistics released by the Saint Paul Area Association of REALTORS® today.

Nationwide, sales of existing homes rose 5.1% to 4.72 million from January to February - the largest sales jump since July 2003, the National Association of Realtors reports.
The surprising increase was driven by buyers taking advantage of big discounts on foreclosed homes. The median sale price was $165,400, down 15.5% from a year earlier and down 28% from their peak in July 2006.

First-time home buyers who could not break into the housing market in the boom years are prime buyers now that prices are at or near bottom and mortgage interest rates are below 5%.
According to Cindy Moynihan with Prime Mortgage, "the stimulus tax credit is working. We have seen a remarkable increase in the number of mortgage applications compared to last year and we have a number of clients that are in the pre-approval process ready to purchase a home". She goes on to say that "first time homebuyers have been given $8,000 that does not have to be repaid and they are ready to spend it."

Another good sign in this spring market is the decline in the number of new listings added to the overall inventory in the Twin Cities metro area. There were 7,870 new listings added in March compared to 8,523 in March 08, a 7.66 percent decline. Meantime, median sales price in the Twin Cites metro continues to search for its low point. The median sales price for a single-family, residential property in March 09 was reported at $154,125, a 22.94 percent decline from one year ago. The median sales price one year ago was $200,000. However, as inventory decreases and as buyers get motivated by low interest rates and tax credit programs, the median sales price could be close to reaching its floor. For the first time since July of last year the median sales price increased on a month-over-month basis by 2.75 percent. The median sales price one month ago was $150,000. Housing statistics include existing single family homes, condominiums and townhomes.

Statistics are provided by the Saint Paul Area Association of REALTORS® and are based on data supplied by the Regional Multiple Listing Service.

Pending Home Sales Offer Hope

For-sale signs have stayed in place a little longer with the persistent decline in home sales. But Tuesday brought good news: The pending home sales index nationwide rose 6.3 percent from November to December.

The national and local increases reported Tuesday are seen as good news for a depressed housing market.

By JIM BUCHTA, Star Tribune

Good news arrived for Main Street --and Wall Street -- on Tuesday when the National Association of Realtors reported that its pending home sales index nationwide rose 6.3 percent from November to December. That report helped reverse three days of declines for the Dow Jones industrials, lifting the index 141 points.

The Twin Cities got even better news. Actual pending sales in the 13-county metro area during January rose a robust 17.7 percent, marking the seventh consecutive year-over-year monthly increase, according to an analysis of data from the Minneapolis Area Association of Realtors.
While the latest sales figures are a bright spot in an otherwise gloomy economy, persistent declines in home prices, clogged credit markets and rising unemployment suggest that a full recovery might still be several months down the road.

"I would love to think that this is the bottom," said Mary Bujold, director of research for Minneapolis-based Maxfield Research. "But I don't know that right at this moment that I can be that optimistic."

The pending sale report is closely watched by many because it's an important indication of future activity. It generally takes two to three months for those pending sales to become closed sales, but in today's market, not every pending is going to become a closed sale the next month.
Yet other market indicators will continue to present challenges well into next year: Median sale prices are expected to fall at double-digit rates for several months to come, and getting a mortgage is still a challenge for many buyers. That's why the national group is lobbying the government for additional tax credits to help stimulate the market.

"Significant uncertainty still clouds the housing market despite improved affordability conditions," said Lawrence Yun, chief economist for the National Association of Realtors. "For a sustainable housing market recovery and, hence, sustainable economic recovery, we need a significant housing stimulus."

New listings coming on the market have steadily declined, reducing overall inventory levels. That includes the inventory of new homes as well.

The number of unsold new houses on the market in the seven-county metro area has fallen from 6,000 units during the first quarter 2007 to a little more than 3,200 by the end of 2008, according to data from MetroStudy. That translates into a 7.7-month supply of new housing.
In Washington earlier this week there has been debate about a plan to lower the interest rate on home mortgages to 4 to 4.5 percent and to stimulate borrowing by requiring Fannie Mae and Freddie Mac to purchase those mortgages from lenders.

There's also expected to be pressure from Republican officials to implement a $15,000 tax credit for home buyers. Already, a $7,500 federal tax credit that became available last year is getting some recognition for helping to lift the market.

However, more credit for the rise in pending sales is being given to distress sales, which accounted for 32 percent of all active listings in the Twin Cities metro area last month. Sales of those lender-mediated transactions, including foreclosures and short sales in which the lender forgives part of the mortgage to facilitate a sale, have been a drag on home prices. The median sale price of a traditional home sale last year was down 2.6 percent, while lender-mediated sales plummeted 19 percent, according to the Twin Cities association.

Pending sales don't translate directly into closed sales the next month. In November, for example, in the Twin Cities metro area, pending home sales rose 3.7 percent ahead of the same month in 2007. But in December closed sales rose almost 15 percent compared with December 2007.

Though such data aren't tracked regionally, some say that contract cancellations are on the rise. That's because in today's market, borrowers are more likely to discover after they've signed a contract that they can't get a mortgage, while others are making low-ball offers on bank-owned listings that can take many months to close.

The National Association of Realtors said Tuesday that the increase in pending sales in December was well above what economists expected.

Though declines in inventory and rising sales are good news for the market, broader economic challenges persist.

"People just don't know what's going to happen," Bujold said. "Uncertainty means that you don't go out and make any purchases unless you feel like you have to take advantage of it because it's not going to come around again."

Early Signs Of Foreclosure And Short Sale Slowdown

NEWS RELEASE

FOR IMMEDIATE RELEASE
Early signs of foreclosure and short sale slowdown-

Q4 2008 Update to “Foreclosures and Short Sales” report is released with exciting new interactive data tool Minneapolis, Minnesota (January 27, 2009) – Foreclosures and short sales in the Twin Cities housing market are showing early signs of slowing, according to a new research report released by the Minneapolis Area Association of REALTORS® (MAAR) based on data from the Regional Multiple Listing Service of Minnesota, Inc (RMLS).

During the fourth quarter of 2008, there were actually 4.3 percent fewer new lender-mediated listings than there was in the third quarter. That’s the first quarter-to-quarter decrease since 2003. As a result of this reduction in new supply and continued buyer interest in these properties, the total number of lender-mediated homes for sale dropped 600 units over the course of the quarter. This is only one quarter of downward movement, so time will tell whether the trend continues. Regardless, this has to be taken as a hopeful sign.

“By no means is the hard part totally over,” said Steve Havig, 2009 President of the Minneapolis Area Association of REALTORS®. “What the economy does in 2009 is the real wildcard, but the sooner this cycle runs its course, the sooner the housing market can return to some normalcy.”

New Listings
Lender-mediated home values are dropping quickly, while traditional homes are fairing better. The median sales price of lender-mediated homes in Q4 2008 was $131,000, a drop of 19.1 percent from the same time last year. The median sales price for traditional homes was $221,000, a drop of a much quieter 2.6 percent.

Despite the fall in new supply from last quarter, 42.2 percent of new listings and 46.0 percent of closed sales during Q4 2008 were lender-mediated. This is an increase from the same quarter last year, due in part to declining activity in the traditional market.

Edina Realty Mortgage

An Important Message from Todd Johnson,President and CEO of Edina Realty Mortgage

To Our Customers,

The dramatic events taking place in the financial services industry and economy are historic in scope and proportion. You may be asking yourself, “What does this mean for me as a home buyer or home seller? When I want to obtain a mortgage, will there be funds available?” The answer is simple: at Edina Realty Mortgage, it’s business as usual. Yes, we continue to originate mortgages for home purchases and refinances. Our wide product range features FHA, VA, MHFA, Conventional, Jumbo, Relocation, Renovation, and Reverse Mortgages. We are committed to helping as many customers as possible enjoy the personal and financial benefits of homeownership. We provide competitive, fully disclosed, and responsible and fair pricing for all borrowers.

A Solid, Stable and Secure Lender

We want to assure you that we remain a solid, stable, and secure mortgage lender. We are a well-capitalized company, and we hold fast to our long-standing responsible lending principles. Edina Realty was one of the first real estate companies to offer integrated mortgage services more than twenty-five years ago. For over ten years, Edina Realty Mortgage has been a joint venture between Wells Fargo Home Mortgage (a division of Wells Fargo Bank, N.A.) and HomeServices of America, a Berkshire Hathaway Affiliate. Wells Fargo Bank, N.A., is the only bank in the United States, and one of only two banks worldwide, to have the highest credit rating from both Moody’s Investors Services “AAA,” and Standard & Poor’s Rating Services, “AAA.”

We Are Committed to Your Successful Closing

We stand by our word. Our exclusive On-time Closing Guarantee (1) ensures that you will close on time AND for the amount quoted on the Good Faith Estimate, or you will get money back. Are you already working with another lender? We will be happy to review your Good Faith Estimate and Truth-in-Lending Disclosure Statement. This no-obligation second opinion from us takes just few minutes, and we may be able to provide reductions in interest and/or closing costs.

As a responsible lending leader, we work closely with our customers to help you reach your personal and financial goals through homeownership. Our team works hard to know you, understand your needs, and listen to you. We put you at the center of everything we do.

Thank you for trusting us with your business.

Todd JohnsonPresident and CEO

1. Available on all qualified purchase transactions. Other terms and conditions apply. See a Home Mortgage Consultant for details.
2. If you have a current lock-in agreement with another lender, this is not an inducement to transfer your loan.
All first mortgage products are provided by Homeservices Lending, LLC Series A dba Edina Realty Mortgage. Edina Realty Mortgage may not be available in your area. Wells Fargo Home Mortgage is a division of Wells Fargo Bank, N.A. ©2008 Edina Realty Mortgage. All Rights Reserved.