Thinking about buying a home but don’t know where to start? Why not start by reading the home buyer hand book that we have provided below. It is a great place to start to get the information you need. When you’re ready, we would love to help you find and finance a new home.

Yes IT IS being done!!  A reverse mortgage purchase using the FHA HECM loan.  We’re doing them at Venture Development.  We put together a power point on it for your review.  http://www.slideshare.net/mnguru/reverse-mortgage-purchase-senior-mortgage This is another interesting way that homes can be sold and buyers can achieve a housing payment that works for them.

As a Minnesota mortgage broker, we have investors who will fund the FHA 203k program.  Not every lender will allow for a 203K, as they require more paperwork and have more responsibility associated with them.  That being said, you will want to explore the 203K loan if you want to make some updates or remodel to an existing or new purchase.  I have run across a very knowledgeable 203K consultant.  You will definitely want to check out his site as well at: http://203kloanmn.com/about-203k-loan-minnesota When you are ready, call us and let’s begin your mortgage paperwork (we broker loans throughout Minnesota).

Many people mistakenly think short sales can’t or won’t be done on FHA insured loans.  THIS IS NOT TRUE
Here is the link to the HUD pdf which outlines their current program guidelines:  http://www.hud.gov/offices/hsg/sfh/nsc/rep/pfsfact.pdf If you are in Minnesota and your home is within the 7 county metro area around the Twin Cities, we can help you list your home and do a short sale.

FHA is thinking about changing their minimum credit score requirements for loans. In the meantime, lenders are adding their overlay on top of FHA. So, what this means is that although a loan will eligible for FHA insurance with a score of 580, they may impose a minimum of 640. MOST lenders today are 620. Many are moving to 640 and even 680!! This is why it is important to work with a broker that has a number of outlets. Otherwise, you may be told “NO” by your favorite lender on the street corner, when you could have been told “YES” and taken advantage of the low interest rates, tax credits and other incentives.

Many lenders/brokers are not offering the FHA ARM. WE DO!!!. FHA ARM’s adjust 1 percent per year, once per year, with a lifetime maximum adjustment of 5% over the start rate. Let’s look at a WORST case example. Lets start a 4% year 1. Upon adjustment with worst case, we’re looking at yr 2- 5%, yr 3- 6%, yr 4-7%, yr 5-8%, yr 6-9%. As with all ARM’s there is a formula to make the adjustment based on adding a margin to an index. The conventional ARMS usually have higher annual and lifetime caps, as well as a larger down payment requirement.

Due to an increase in foreclosures, FHA finds itself needing to increase the cost of mortgage insurance. The upfront MIP is increasing from 1.75% to 2.25%. FHA allows borrowers to purchase a home with 3.5% down. The borrowers using FHA often don’t have a lot of reserves or ability to put more down. The lack of financial resources coupled with a shaky economy has led to an increase in foreclosures. The insurance premiums are used to cover the mortgage losses. The monthly insurance cost of .55% of the loan will remain the same.

Article From HouseLogic.com

By: Oliver Marks
Published: September 01, 2009

Doing home-improvement jobs yourself can be a smart way to save money, but choose the right DIY projects or you’ll end up paying dearly.

Why pay someone big bucks to do something you can just as easily do yourself? That’s the thinking that has gotten more Americans than ever swinging their own hammers. In a recent Time magazine poll, nearly a quarter of people said they were taking on more home-improvement projects themselves-understandably so, when you consider that it usually means a 50% to 75% discount, since all you pay for is materials.

But sometimes doing it yourself costs more than it saves, like when you decide to replace the toilet, end up flooding the basement, and have to pay a pro to fix your mistakes. Or, worse, if you become one of the more than 100,000 people injured each year doing home-improvement jobs. Here are some guidelines for deciding when DIY can save you money and when it could cost you.

Stick to routine maintenance for savings and safety

Seasonal home maintenance (http://www.houselogic.com/categories/maintain-structures-systems/) is ideal work for the DIY weekend warrior, since you can plan tasks in advance and get to them when your schedule allows. Because these are repeat projects, your savings will add up to big bucks over the years. Just by mowing your own lawn, for example, you can save $55 to $65 a week for a half-acre lawn during the growing season. The bigger the lot, the bigger the savings: with two acres, you’ll pocket around $150 per week.

When It Pays: Look for maintenance jobs that are relatively easy and need to be done regularly, so you can hone your skills over time. In addition to mowing, other good ones are snow removal, pruning shrubs, washing windows, sealing the deck, painting fences, fertilizing the lawn, and replacing air conditioner filters.
When It Doesn’t: Unless you have skill and experience on your side, stay off of any ladder taller than six feet; according to the U.S. Consumer Product Safety Commission (http://www.cpsc.gov), more than 164,000 people end up in emergency rooms every year because of ladder injuries. The same goes for operating power saws or attempting any major electrical work-it’s simply too risky if you don’t have the experience.

Act as your own GC on small jobs

If you’re more comfortable operating an iPhone than a circular saw, you may be able to act as your own general contractor on a home-improvement project and hire the carpenters, plumbers, and other tradesmen yourself. You’ll save 10% to 20% of the job cost, which is the contractor’s typical fee.

When it Pays: If it’s a small job that requires only two or three different tradesmen, and you have good existing relationships with top-quality professionals in those fields, consider DIY contracting.

When It Doesn’t: Unless you have an established network of contacts who will show up as promised, the time to spend on oversight, enough construction experience to spot potential problems, and the skill to negotiate disputes between the various subcontractors, trying to manage your own project can quickly send the schedule and budget off the rails.

Pitch in with sweat equity on big jobs

Contributing your own labor on a big job being handled by a professional crew can cut hundreds or even thousands of dollars off the contractor’s bill. Tear the cabinets and appliances out of your old kitchen before the contractor gets started, say, and you might knock $800 off the cost of your remodel, says Dean Bennett, a design/build contractor in Castle Rock, Colorado.

When it Pays: Grunt work-jobs that are labor intensive but require relatively little skill-makes the best homeowner contribution. Offer to do minor interior demolition like removing cabinets and pulling up old flooring, daily jobsite cleanup, product assembly, and simple landscaping like planting foundation shrubs and grass seed around your new addition.

When It Doesn’t: If you get in the crew’s way, you may slow them down far more than you help. Make your contributions when the workers aren’t around, such as in the morning before they arrive, or on nights and weekends after they’ve left.

Put on some of the finishing touches

Unlike the early phases of a construction job, which require skilled labor to frame walls, install plumbing pipes, and run wiring, many of the finishing touches on a project are comparatively simple and DIY-friendly. If you do the painting yourself for a new basement rec room, for instance, you can easily save $1,800, Bennett says.

When it Pays: If you have the skill-or a patient temperament and an experienced friend to teach you-finish work like setting tile, laying flooring, painting walls, and installing trim are all good DIY jobs.

When It Doesn’t: The downside to attempting your own finish work is that the results are very visible. Hammer dents in woodwork, for example, or sander ruts in your hardwood floors may cause you aggravation every time you see them. So unless you have a sure eye and a steady hand, it may not pay to embark on these tasks.

A former carpenter and newspaper reporter, Oliver Marks has been writing about home improvements for 16 years. He’s currently restoring his second fixer-upper with a mix of big hired projects and small do-it-himself jobs.

Reprinted from HouseLogic (houselogic.com) with permission of the NATIONAL ASSOCIATION OF REALTORS®
Copyright 2009. All rights reserved.
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Article From HouseLogic.com

By: Oliver Marks
Published: September 30, 2009

Review your remodeling contract carefully and adjust it to make sure it protects you in terms of payments, work schedules, and project specifications.

Even if you never intend to pick up a hammer for your remodeling project, there’s one tool that’s absolutely essential-a solid contract. But just having one often isn’t enough. That’s because the document a contractor gives you is designed to protect him. It’s up to you to add in some basic protections for yourself. Here’s what you need to know to make sure the remodeling contract you sign includes solid legal protection for you and your home.

Hiring a lawyer to review and make changes to a contract is a safe bet, especially since each state has its own construction-contract statutes. But not many homeowners are willing to shell out $500 for an attorney review, plus $1,000 to $1,500 additional fees to make wholesale revisions to a flawed contract. However, you can hand-write changes and additions in plain English and make sure both you and the contractor initial each change to the document, says Tampa, Fla., attorney George Meyer, who is chair-elect of the American Bar Association’s Forum on the Construction Industry. Here’s what you want to add (and subtract).

Project specs

Start by reviewing your contract, a process that should take several hours. The most important element of a contract is a thorough and complete description of the project, and the materials and the products that will be used. “It should say that the contractor will secure all necessary permits and approvals as well as what walls are being moved where, what type of countertops are going in, what type of sink, what type of faucet, and so forth,” says Meyer. “You can’t rely on everyone’s memory because if there’s a problem later, people may remember different things.” The contract needn’t contain these specs on its pages, it can simply refer to the contractor’s attached itemized bid. Avoid allowances (http://www.houselogic.com/articles/getting-best-work-contractor/), which are pools of money set aside for work to be determined later, and which often lead to cost overruns.

Payment schedule

The contract (http://www.houselogic.com/articles/getting-best-work-contractor/) should also state the total price for the job, and that it’s a fixed price-not an estimate. It should provide a schedule of how the payments will be made by linking them to milestones in the work-such as when the foundation, rough plumbing, and electricity will be completed-so you’re paying for work only after it’s done. “You should always have enough money left to hire someone else to finish the work if need be,” says Meyer. In general, the first payment should be no more than 10% of the total job and the final payment should be at least a few thousand dollars to ensure that it’s a big enough incentive to get the contractor back for the final niggling details. If you’re unsure whether the payment schedule is proportional to the milestones your contractor suggests, ask a friend who’s familiar with construction process or consult a construction attorney.

Start and end dates

A contractor’s boilerplate contract rarely includes dates for when he will begin work and when he will complete the job, so make sure those details are included. It’s not that he’ll be penalized if it runs late, only that if you ever have a major problem and need to sue him-or defend yourself from a suit he brings-showing that the contractor is, say, two months behind schedule will help you make your case. The dates needn’t be too exacting. If he says it’s a six to eight week job, eight or even nine weeks is fine for the contract, says Meyer.

Statement about change orders

Make sure the contract contains a line stating that any changes that will affect the cost of the job must be priced in writing and countersigned by both the contractor and homeowner before that work commences. That ensures that an offhand discussion about a possible change to the project won’t result in a huge unforeseen additional cost (http://www.houselogic.com/articles/getting-best-work-contractor/). It also helps you, as the homeowner, keep track of exactly how much you’ve added to the bottom line, so you can avoid the very common urge to keep expanding the job.

Binding arbitration

Many contractors include a line that says that rather than going through the courts, disputes will be resolved by an arbitrator. Some legal experts feel that this is a quicker and lower-cost solution to problems, so a binding arbitration clause isn’t necessarily a problem. What can be trouble is if the contract requires a specific arbitrator. “There are some big, national, well-respected arbitrators, like the American Arbitration Association (http://www.adr.org),” says Meyer. “And there are other questionable arbitrators that always side with the contractor. If a particular arbitrator is specified, I’d do some internet research about the agency to make sure it’s legit.”

Warranty

Having the contractor’s warranty in the contract seems like a good thing, right? Well including it is often actually a technique for limiting how much liability the contractor has. “It’s usually loaded up with exclusions and time limits,” says Meyer, “and you’re actually better off with no mention of warranty at all because then the only limits on his warranty are what’s in the state statutes.” In other words, keeping the contractor’s warranty language in the contract will likely mean you’re agreeing to less than what state law provides. For example, state law may specify a longer warranty term than what the contractor’s warranty offers. So, unless you’re having a lawyer review the contract, strike the warranty clause.

Technicalities

There are numerous state-by-state requirements for construction contracts. He may have to include his contractor’s license number, for example, and he may have to include a clause saying you have the right to rescind the contract within a certain time period after signing. And unless you and the contractor sign the document, it doesn’t matter what it says-it’s not a valid contract.

A former carpenter and newspaper reporter, Oliver Marks has been writing about home improvements for 16 years. He’s currently restoring his second fixer-upper with a mix of big hired projects and small do-it-himself jobs.

Reprinted from HouseLogic (houselogic.com) with permission of the NATIONAL ASSOCIATION OF REALTORS®
Copyright 2009. All rights reserved.