Minnesota First Time Home Buyer Education Resources

If you’ve never bought a house before, Minnesota is the rare state that actually works toward educating first time home buyers so that they can answer the following two important questions.

  1. What is your actual financial situation?
  2. Do you have the income/money needed to truly afford that home which you think you’d like?

first_time_home_buyer_help_minnesotaMinnesota helps first time home buyers answer those questions and others through the “Home Stretch” workshops offered throughout the state. Designed to help people understand the process of buying a home, from start-to-finish, Home Stretch is a helpful workshop that lasts anywhere from 8 hours to 2-3 days, with a “certificate of completion” given at the end.

The Home Stretch workshop helps people understand how credit works, and how credit affects the costs of home ownership. In addition, the workshop helps you decide what type of mortgage is best for you, as well as understand the loan closing process.

What type of home is the right fit for you and your situation? Are there special programs available for first time home buyers? These questions, and others, are answered in the Home Stretch workshop. Objective, practical information for first time home buyers in Minnesota is available—take full advantage of the Home Stretch workshop.

First Time Home Buyer Programs and Counseling

first_time_home_buyerAre you a first time home buyer in Minnesota? If your answer is “yes” there are some things you should be doing to prepare for the purchase of your first home. Minnesota offers in-person or online homebuyer education programs to help you learn about the process of buying a home and make smart decisions. These are valuable resources that save people a lot of headaches.

The in-person workshops are called “Home Stretch,” and feature a classroom learning environment, where an experienced teacher shares with you and others important knowledge. It’s a chance to hear from mortgage lenders, real estate agents and/or home inspectors about what they do and what it’s like to connect with them in order to complete the first time home buyer process in Minnesota. The “Home Stretch” program has been going strong for more than two decades, helping over 100,000 Minnesotans navigate the home buying process.

For those who prefer to learn online, on your own schedule, and in the comfort of your pajamas, Minnesota offers “Framework,” to guide you through home buying topics in a high-quality, interactive way. Already thoroughly tested by first time home buyers, “Framework” works, and works well. It meets the National Industry Standards and all the requirements of the HUD Housing Counseling program, so you are guaranteed quality content from an independent source. In addition, many lenders have approved “Framework” to meet their requirements for homebuyer education.
Minnesota is fortunate to have programs like “Home Stretch” and “Framework” to help guide first time home buyers.

Besides getting a good education about the ins-and-outs of buying a home, get your credit score/report to be the best it can be—mortgage lenders care about that information, as it affects the rate you’ll pay and whether or not they’ll choose to work with you. Your credit report should be checked for errors, such as accounts that aren’t yours or late payments that were actually paid on time. Furthermore, if you can get in the habit of paying your bills “on time” as well as paying down the balance(s) on your credit card(s), your credit score can improve in as little as two months.

It’s a good idea to establish a working relationship with a local real estate agent who can help you find the “right” house to buy in a neighborhood you’d feel comfortable in. The agent can also help you with the piles of paperwork involved in the home buying process.
Finally, realize that Minnesotans who may need some financial assistance to buy a home have options, including a monthly payment loan or a deferred payment loan, with details here: http://www.mndownpaymentassistance.com/down-payment-assistance/.

Minnesota Housing Finance Agency

MN Housing Finance Agency

The Minnesota Housing Finance Agency plans to invest almost $800 million this year to help low and moderate-income Minnesotans afford housing. The agency has key priorities, which include preserving federally-subsidized rental housing, addressing critical needs in rental housing markets, preventing homelessness and foreclosures, and promoting home ownership.

Affordable housing in Minnesota is available to first time home buyers and others. Minnesota Housing is involved in financing and long term asset management regarding rental housing in the state. Building stronger communities, Minnesota Housing also works to help people buy and fix up their homes. For more than 40 years, Minnesota Housing has helped people find, buy/rent, and maintain affordable housing, and shows no signs of slowing down in 2014.

When someone plans to buy a house in Minnesota, they often need some form of financial assistance to make it happen. That’s where Minnesota Housing Finance Agency and others, such as Lake Area Mortgage, a Division of Lake Area Bank, come in.

Minnesota Housing Finance Agency offers several housing loan products to help with the associated costs of buying and improving a home, and Lake Area Mortgage is a team of experienced people who help Minnesotans figure out how they can benefit from a myriad of options when it comes to mortgage loans available through the agency.

Most people do not pay cash-in-full for their house. Most people take out a mortgage and/or get some financial assistance because purchasing a home is one of life’s biggest purchases.

The Mortgage Division Team at Lake Area Mortgage, a Division of Lake Area Bank can help you with your housing wants and needs; call 651-209-2900 to speak to someone who can get you started on financing your new place to live

First Time Home Buyer Incentives

Who is a first time home buyer? You might be surprised to learn that there is more than one answer to this question. Of course someone who has never owned a home before is considered a first time home buyer but, unknown to many, other people not fitting that description might also be considered first time home buyers. Here are others who count as first time home buyers:

  1. An individual who has not owned a home for at least three years is also considered a first time home buyer.
  2. First time home buyers can also be displaced homemakers or single parents who have only owned a home with a former spouse.
  3. If you owned a home that was not permanently affixed to a foundation, such as a mobile home, you could be considered a first time home buyer.

The U.S. government wants low- and moderate-income families or individuals be able to own homes. At the same time the government and mortgage lenders recognize that purchasing a home is quite costly and offer first time home buyer incentives to help people become homeowners who might not otherwise be able to.

First time home buyer loans are available through Minnesota Housing, which offers three down payment and closing cost loan options referred to as “Start Up,” “Step Up,” and the “Mortgage Credit Certificate.” All of these affordable loans are meant to help finance the buying and/or repair of homes so people with limited incomes or savings can obtain affordable housing.

If you fit any of the first time home buyer descriptions above call Lake Area Mortgage, a Division of Lake Area Bank at 651-209-2900 and discuss your situation and needs with an experienced team member who can help you navigate the various loan programs available to you. We will work with you plan a course of action and give you the advice you need to help you get financial assistance buying your first home in Minnesota.

6 Things First Time-Home Buyers Need To Know

6 Things First-Time Home Buyers Should Know in 2014

Assistance for first time home buyers in Minnesota is readily available. Here is some important first time home buyer advice and information you should know before you make your purchase.

  1. The U.S. Department of Agriculture (USDA) offers a zero down mortgage option for “rural development.” You may be thinking, “But I don’t want to live on a farm!”  but keep in mind that certain areas you wouldn’t think of as “rural” may actually qualify for USDA rural development financing.
  2. Military veterans may use the VA mortgage loan to finance their first home.
  3. The Federal Housing Administration (FHA) has a 203(b) loan which typically has a lower down payment requirement, lower monthly insurance premiums, and lower closing costs than other mortgage loan programs. First time home buyers should look into the FHA loan.
  4. If you’re thinking of buying a foreclosed home, a HomePath Mortgage may be of interest. With a low down payment, no mortgage insurance required, and no appraisal needed, a HomePath mortgage can help you buy a fixer-upper for your first home. Also look into what’s called HomePath Renovation, a loan to help finance the purchase and remodeling of an investment home, lending up to 35% of the as completed value—no more than $35,000.
  5. Got your eye on a home that needs major rehab that will cost more than $35,000? Apply for the full FHA 203k loan, which will help you make necessary structural repairs so you can have a nice first home. A variation on this is the 203k Streamline loan for homes that need minor repairs, up to $35,000.
  6. First time home buyers should talk with a mortgage consultant. They’ll check your credit score and help you see where you’re at financially, and whether or not you’d qualify for a mortgage.

In Minnesota, contact Lake Area Mortgage, a division of Lake Area Bank at 651-209-2900 for help with finding financial assistance, down payment assistance and more. The experienced team at Lake Area Mortgage can answer your first time home buyer questions, and guide you in the right direction to make getting that first home go from dream to reality.



Minnesota Housing has been helping home buyers finance homes for more than 40
years. We partner with a statewide network of approved lenders to offer safe and affordable home loans.

Why choose Minnesota Housing?
• Low, affordable interest rates
• Downpayment and closing cost loans for eligible borrowers
• Statewide network of experienced lending partners

To be eligible, you must:
• Be a first-time homebuyer (or have not owned a home in three years)
• Be credit qualified with a minimum credit score of 640
• Meet program requirements for income and home cost limits
• Qualify for an FHA, FHA Streamlined 203k, RD, VA, Conventional Fannie Mae HFA Preferred, or Conventional Fannie Mae HFA Preferred Risk Sharing loan


Minnesota Housing introduces a new program to help homeowners refinance or purchase a new home:

Why Choose A Minnesota Housing Step Up loan?
• Available to existing homeowners and non-first-time home buyers
• Purchase and refinance options
• Affordable interest rates
• Monthly Payment Loan available for down payment and closing costs

To be eligible, you must:
• Be credit qualified with a minimum credit score of 640
• Meet income and loan or home cost limits
• Qualify for a FHA, RD, VA, Conventional Fannie Mae HFA Preferred, or Conventional Fannie Mae HFA Preferred Risk Sharing loan


Eligible Minnesota Housing borrowers have access to three downpayment and closing cost loan options, with availability depending on the first mortgage program selected.  Additional eligibility requirements apply.

• Monthly Payment Loan
• Deferred Payment Loan


What is an MCC?
A mortgage credit certificate (MCC) allows you to claim 35% of the mortgage interest you pay each year as a federal income tax credit, reducing your tax bill by up to $2,000 per year.

How it Works

How does an MCC work with my home mortgage?
You will need a mortgage to buy the home. You can combine a low-interest Minnesota Housing mortgage with the MCC.

How much money can I save with an MCC?
• To benefit from an MCC you must have an income tax liability.
• Savings vary, depending on your loan amount and interest rate.
$175,000 loan amount at 4.375% interest
Estimated savings over the life of the loan = $44,000

How long can I use the credit?
You can use the MCC for up to 30 years, or until you refinance, sell the home or move.

Can I still take the mortgage interest deduction on my income taxes?
Yes, you can deduct the remaining 65% of the mortgage interest paid.

Can I get help with my downpayment?
With a Minnesota Housing home mortgage you can get both an MCC and a Minnesota Housing Monthly Payment Loan with a maximum loan amount of 5% of the purchase price, or $5,000 (whichever is greater), to cover downpayment/closing costs.

Interested in applying for a loan? Contact us today

Great Time To Buy With Rents Rising Dramatically!!!

Despite a barrage of new apartment buildings in the Twin Cities metro area, demand for rentals continues to outstrip supply.

The average vacancy rate in the seven-county area dipped to 2.3 percent at the end of June, causing the average metro rent price to increase 3 percent to $979, according to a second-quarter survey by Marquette Advisors. That was the largest quarterly decline in vacancy rates in two years, and the ninth consecutive quarter of vacancy rates below 3 percent.

“There are some very positive demographic, economic and lifestyle trends underway in the Twin Cities,” said Marquette Advisors vice president, Brent Wittenberg.

Much of the demand is being fueled by young professionals and empty nesters who don’t want to make a long-term commitment to homeownership and are interested in the perks of urban living. “People want to live close to night life and the amenities they use for recreation,” said Brent Rogers of Greco Development.

For rental property owners and developers, the housing crash and subsequent recession was a turning point. With mortgages difficult to get and thousands displaced by foreclosures, demand for rentals soared. Adding to the trend was a surge in empty nesters and twenty-somethings wanting the ease and flexibility of renting.

The number of people age 55 to 64 in the Twin Cities will rise by about 6,000 per year over the next five years, Wittenberg said. Meanwhile, “Gen Yers” (ages 25-34) will expand by more than 4,000 per year.

Money-Saving Tips For Homeowners/Homebuyers

If you are a homeowner, you know the importance of saving money. However, what you may not know is that, as a homeowner, there is a vast array of things that you can claim as write-offs on your taxes. Here are just a few money-saving tips you can use during tax time.

First-Time Homebuyer’s Credit

If you bought your home between January and April of the year you are filing taxes, you may be eligible for a credit. While this credit is referred to as a first-time homebuyer credit, as long as you purchased your home in the required time frame, you may qualify.

However, to qualify for a larger credit, you must not have owned a home during the three years prior to purchasing your new home. To qualify for a smaller credit, you must have owned a previous home for at least five of the eight years prior to purchasing your new home. No credit is given for homes valued at more than $800,000.

Home Energy Credits

You may also qualify for a tax credit if you installed energy-saving features in your home such as energy-efficient windows, doors, heat pumps, furnaces, air conditioners or water heaters. This credit is 30 percent of the cost of installation, with a top credit of $1,500.

You may also be eligible for a tax credit if you have installed various alternative energy features in your home. These include, but are not limited to, solar panels, geothermal heat pumps, solar-powered water heaters and residential wind energy systems. In these cases, your credit is 30 percent of the full cost of the system, with no limits.

Tax Credit for Moving Expenses

If you had to move more than 50 miles from your old home for a new or existing job, you can deduct your travel and lodging expenses for you and your family. You can also deduct the cost of moving your furniture and other household property. This deduction is allowed even if you do not itemize your deductions.

Deductions for Property Taxes

If you paid any local or state property taxes during the year, you may be eligible for a deduction. This deduction helps increase your standard deduction on your tax return. If you qualify, you may be able to add $500 to your standard deduction if you are single and $1,000 if you are married and filing jointly.

If you own any rental homes, you can deduct any property taxes you paid for them on IRS form Schedule E. Finally, if you bought your home during the year that you are filing your taxes, and the seller had paid a portion of its property taxes for that year, you can include that amount in your property tax deduction as well.

Deductions for Home Damage

If your home was damaged due to such things as a fire, storm or burglary, you may be eligible to claim a deduction on your tax return. To calculate your deduction, subtract $100 for each casualty or theft event and then subtract 10 percent of your adjusted gross income.

These are just a few of the great money saving tips for homeowners at tax time. Other deductions you may be eligible for include residential boats, RVs, vacation homes and rentals, depreciation of your home, home-equity debt, home offices, home sales, mortgage interest, clergy allowances and IRA payments.

Homeowners can potentially save hundreds of dollars during tax time. To take advantage of the credits and deductions that you qualify for, seek help from a tax professional today.

New Home Sales Near Five-Year High, Prices Rise

WASHINGTON (Reuters) – Sales of new U.S. single-family homes rose to their highest level in nearly five years in May, confirming the housing market’s strengthening tone.

The Commerce Department said on Tuesday sales increased 2.1 percent to a seasonally adjusted annual rate of 476,000 units – the highest level since July 2008. It was the third straight month of gains in new home sales.

Sales increased 3.3 percent in April. Economists polled by Reuters had expected new home sales to rise to a 462,000-unit rate last month.

Compared with May 2012, sales were up 29 percent.

Home sales data will be closely watched in the coming months for signs of strain from the rise in mortgage rates.

The housing market recovery, which is helping to soften the blow on the economy from tight fiscal policy, has been largely driven by record-low mortgage rates, thanks to the Federal Reserve’s generous monetary stimulus.

The Fed last week said it expected to start slowing the pace of its bond-buying program later this year, bringing it to a halt around the middle of 2014. That has pushed up mortgage rates, which had already been rising since early May.

Economists do not believe the increase in mortgage rates is sufficient to undo the housing market recovery. Data last week showed confidence among home builders spiked to a seven-year high in June and they were upbeat about sales over the next six months and prospective buyer traffic.

Ready For A New Home?

Thinking about buying a home or selling your current one? Stop thinking and start doing. Now is the prime time for both sellers and buyers. Here’s why.

Mortgage rates are rising. After a sharp decline, mortgage rates are starting to inch back up, with a 30-year fixed mortgage averaging just over 4 percent now, according to Bankrate. And analysts expect that trend to continue. That means more buyers are trying to qualify — good news if you’re selling. And, if you’re buying, it’s one more reason to apply now yourself.

Inventory is decreasing. The number of foreclosed homes, which flooded the market and drove down prices, is ebbing. Meanwhile, there are fewer owner-occupied homes on the market. “Inventory is low,” says Tara Waggoner, a real estate agent in Houston, Texas. That means there should be more demand for your home if you’re selling. And if you’re buying? Well, better to look before inventory falls further.

Home prices are increasing. Home prices are up 11 to 12 percent from a year ago, according to the S&P/Case Shiller Index. And that’s likely to continue. “There’s been a steady increase from the beginning of the year in home prices,” says Waggoner. Sure, you might not get as much for your home as you would a year from now. But you’re likely to get a good price, given how much market values have risen in the last year. And if you’re looking? Better to buy before prices get higher. (The upward trend should also help you feel more assured that your new home will retain, even gain, value.)