Foreclosures

Vacant homes in St. Paul

Posted on by Teresa Boardman

 The last time I wrote about vacant homes was in January of 2011.  There were 1459 registered vacant buildings on the books in January this is way down from the all time record in the fall of 2008 which was 2031.  There are vacant homes that are not on the list because the city does not require that all vacant homes be registered and there are a few cheaters out there too. . . you know who you are . . 

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two vacant houses in a row

Today we have 1421 registered vacant buildings. The list is on the city web site and I know they will move the page in a week or so and break my link so if you land on this article at some point in the future use Google and search on registered vacant buildings and city of St. Paul.*

Nation wide there are a large number of vacant homes I have read estimates that there may be as many as 19 million of them. [Forbes] 

Some of the homes that were vacant last year have been torn down, others have been rehabbed and some are still on the market.  There isn’t any way to track the homes that are vacant but not registered.  If you own an empty home it is important to let your insurance company know that it is vacant. 

If you live next to a vacant home keep an eye on it and alert the police if there is suspicious activity. 

*the city used to have one full time employee who did nothing but move pages on the city web site now they have two.  If you are not a fan of broken links on your site do not link to an item on the city of St. Paul web site. 

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Who benefits the most from a short sale?

Posted on by Teresa Boardman
upsidedown
upsidedown

Anyone who has been a regular reader of this blog knows that I am not a fan of short sales.  I have represented both buyers and sellers and have some experience.  it isn’t like I am one of those talking heads on the TV who talk authoritatively but they just talk. 

A short sale is when a banks accepts less than what is owed on a home as payment in full.  As you can imagine a short sale looks bad on a credit report in fact it looks almost as bad as a foreclosure.  Usually the seller is behind on the payments.  Some banks will not work with owners who are behind on payments and some banks won’t work with those who are.  Honestly I am not making this up I have witnessed it. 

When a short sale works out and the bank actually allows the sale sometimes the people who benefit the most are the real estate agents involved.   The buyer would pay less for the home if it were a foreclosure.  Sure the sellers credit rating may be slightly better than it would have been if the bank had foreclosed on the loan but only slightly and they still can not purchase a home or get credit. 

To some a short sale seems more honorable than a foreclosure.  In a foreclosure the bank gets the home instead of money, in a short sale the bank gets some money owed but not the home.   Trying to prevent a foreclosure with a short sale is a gamble. There are no guarantees that there will be an offer on the home and if there is there are no gaurantees that the banks will accept the offer before they foreclose.  I have seen many cases where the home being offered as a short sale ends up being a bank owned property while there is an offer on it.   

Before considering a short sale find out how it will impact your credit rating.  Make sure that the bank really is agreeing to a short sale and that means they can not file a judgement later to get the rest of what is owed on the home. 

If you want to prevent foreclosure and can not pay off your mortgage and owe more on your home than it can be sold for contact the Minnesota Home Ownership Center first. 

Related article:

Will a short sale work for those who owe more than thier home is worth? Short sale myths

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How many foreclosures?

Posted on by Teresa Boardman

 There have been over 100,000 foreclosures in Minnesota since 2005.  The most common reason people sought for foreclosure counseling  in 2009 was a loss or reduction of income.  A better way of saying it is that people lost jobs and either could not find new jobs or could not find jobs that paid as well as the job they lost and had trouble making their mortgage payments because of it. [Minnesota Housing Partnership]  

foreclosures
foreclosures 

Click on graphic to make it larger. 

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Seven Years of good luck

Posted on by Teresa Boardman
 
bhouse3
Home Sweet Home
 

Some of the people who have gone through foreclosure in the last few years are thinking about their next home.  They will be able to buy again but as a rule they will have to wait seven years.

The credit score will have to come up too.  At a minimum it will need to be in the 620 to 640 range but 700 or above would be much better for getting a decent interest rate.  That is how things are now which isn’t to say they couldn’t change.

If you have been foreclosed upon the first priority should be lowering debt and paying bills on time.  The second priority should be putting some money aside for a down payment.  A few years ago it was relatively easy to buy a home using little or no cash but that isn’t the case today. 

The minimum down payment for most borrowers is 3.5% and that is on an FHA loan.  For the average home in St. Paul at todays prices about $5500 is needed in cash.  There are down payment assistance programs but they are not available to everyone.

Renting is not always a waste of money especially in cases when shorter term housing is needed.  Renting offers more flexibility than ownership does.   It isn’t a waste of money when the goal is to save money, pay off bills and save up to purchase a home. 

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