contract for deed

Home Repair

The Surprising Ways Your House Costs You Money

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If you’re a current homeowner or a prospective buyer, saving money is surely on the top of your priority list, that’s a given, right? However, occasionally, there are instances where you may not realize that you’re leaking money (almost literally). Making sure that your property is running efficiently and that your home repair is on point are two of the most important money-saving tips around.

So, let’s take a look at some of ways we can help you save money in and around your home.

Home Repair Tip: Fix Your Drains

Ever hear your taps dripping in the night? Or, maybe you’ve turned off all the water after cleaning only to find that it’s still dripping away? Well, while it may not seem like a huge amount of water is being wasted at first glance, it can end up costing you a small fortune in the long run.

Let’s put this into perspective; let’s say your faucet leaks roughly 10 drops of water per minute, that equates to 3 liters of water a day, which is around 90 liters a month. This can mean wastes of 347 gallons of water every year. How much does this cost? Well, it depends on your water supplier, but a leaky faucet could be costing you far more than you think. Similarly, any blocked drains or damaged drains that are left untreated can result in nasty blockages, which may then require professional intervention.

Hidden Leakages and Water Damage

Another water-related issue comes in the form of hidden water storage. Checking for water build-up is crucial, especially if you’re looking to move into a new property. Water has a nasty way of hiding in places that are either difficult to reach or hidden. In most cases, this is caused by a fault in the property’s drainage system or a build-up of water deposits (usually on the roof or gutters) that do not drain properly.

Be sure to check for signs of this, as if it is left untreated, not only will it require a drain inspection, but you may find yourself having to redecorate your walls and/or ceilings.

Repair with Double-Pane Windows

The thought of installing brand new windows is never easy to digest as it’s known to be a fairly expensive practice. However, the reason why it’s so important isn’t just aesthetics. In fact, installing new windows actually saves you money in the long run.

So, why is this? To put it simply, single-pane windows are not efficient at keeping the heat inside your property, nor are they too good at keeping the heat out in the summer months! So, instead of constantly adjusting your heat and temperature, it might be worth considering installing double-pane UPVC windows that help retain heat.

Additionally, installing double-pane windows can save hundreds of dollars each year, so it’s definitely something to consider.

Insulation Issues

In a similar fashion to double-pane windows, a properly insulated home can save you a small fortune. The cost of installing effective insulation is low in contrast to the amount of money you’ll be saving in the long-run. Arguably the most important area to install insulation is in your walls, and while there are varying kinds of insulation, cavity insulation is one of the better options if you’re looking to save money.

Additionally, insulation is fairly low maintenance and usually lasts a life time.

Rising Energy Bills (Turn to Solar Energy?)

With the world relying more and more on green energy, many people are beginning to search for more efficient ways to power their homes.  This has lead them to solar power and the many benefits that come from this source of power.

Installing solar panels by yourself will cut some costs. However, it’s recommended that you hire a professional to install the wiring and metering, as this requires connecting the system to the electrical grid. This can be a seriously dangerous task for those who are inexperienced and in severe cases can lead to injury. According to Westline Professional Electricians founder and director Jordan Vellutini, make sure to contact a certified electrician if you’re looking to efficiently install your solar panels.

All in all, acting on these issues early is the key to saving money. Much like you’d hire a maid service to get your place cleaned. The longer you allow these problems to persist, the more damage they will inevitably cause. Many of the above tips are long-term investments, so while they may seem expensive to begin with, you’ll be glad of your investment as soon as you’ve committed!

Rent vs Own

Rent vs. Own: The Actual Monetary Difference

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Some consider rent vs. own to be the ultimate real estate question. For example, if you’re living in Dallas, should you just rent from a site like this because someone else is responsible for repairs, yard maintenance, storm damage, etc ., or should you take the plunge and become an owner so that you can build equity? Where is the tipping point? Where do the lines cross to indicate that it is more sensible to either rent or buy? Just because we are MN contract for deed specialists doesn’t mean that we blindly endorse one scenario over another, so let’s get started.

Let’s Take Autos as an Example

Rent vs. Own

A CPA friend of ours used to buy all of his cars. He took care of them, nursed them along, and replaced countless brake pads, tires, alternators, exhaust pipes, and more. He had a rule that he would finally try to sell the car when the rear-view mirror fell off. Our friend would buy the cars with a bank loan and was obligated for four years of monthly payments. During the first three years, the car was under warranty, so major repairs were not a factor. The new car warranty usually ran out after 36 months, however, so in year four, our friend was making payments and paying for certain repairs. After year four the car payments ended, but repairs became more frequent.

Our friend would take the four years of payments, add repairs, then subtract that from the price he ultimately received for his used car. Frankly, with some vehicles he won, and with others he lost. Eventually our CPA decided that we would never buy a car again because it was a depreciating asset, and he didn’t want to own depreciating assets.

He instead decided to lease all of his vehicles for three years max. He made 36 monthly payments but any repairs were covered by the new car warranty. Many times, he could even get along without having to replace the tires. He considered the monthly payment to be a “cost of driving,” and figured that he would have had that cost anyway since it was either payments, payments plus repairs or repairs only. At the end, if he owned a vehicle, his $18,000 purchase might be worth only a few thousand dollars, and he decided that owning a car was a futile exercise.

But What About Homes?

Some people apply the rental theory to homes. They don’t want to cut the grass. They don’t want to pay for repairs, and they don’t want to worry about the housing market. If you agree, by all means find a great rental property and let someone else worry about the taxes, upkeep and maintenance. If something breaks, call the landlord and spend your money on something else.

Check Out the Residential Difference

Rent vs. Own Homebuying

Image via Trulia

We do urge you to look at the other side, however, as there is a one huge difference: Homes increase in value. We of course can’t guarantee that every purchase is going to be a winner. But look at Austin, TX, for example where housing prices have increased over 30 percent in the last few years. And here is what Zillow currently reports about Minnesota:

The median home value in Minnesota is $225,300. Minnesota home values have gone up 8.0% over the past year and Zillow predicts they will rise 7.9% within the next year. The median list price per square foot in Minnesota is $177. The median price of homes currently listed in Minnesota is $265,000 while the median price of homes that sold is $237,300. The median rent price in Minnesota is $1,550.

Rent vs. Own: Compounding Benefits

When you buy, your monthly payment reduces the amount owed on your appreciating asset. You win both ways as your house becomes more valuable but you owe less. Your equity increases because you are paying down the loan, and because prices are rising. Furthermore, as you pay down your loan, the amount attributed to equity goes up, and the amount paid toward interest goes down. Get into that 10th ownership year and you may be surprised at the equity you have built, even if the housing market is not robust.

The Contract for Deed Crew Can Help

We can’t put money into your checking account (you can learn a ton of skills online to help you do that; example: how to start couponing). But remember, we can help you get a house.  That said, we like traditional financing and congratulate you if you have been approved. If not, let’s talk about what C4D can do for you. We are MN contract for deed experts, and as we have told you previously, we many times say yes when your bank has said no. Go here for more info.

Homebuying After Divorce

Buying A House After Divorce: Yes! It’s Possible.

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Buying a house after divorce is a huge issue for many people across the country. To start, divorce can cost you a fortune. What else you ask?

Well, let’s face it, divorce is rarely stress free, and your recent interaction with the family court system is probably something you never want to go near again. You’ve spent time away from work, agonized about visitation rights, thought endlessly about money making ideas and paid some hefty legal bills, but the fun is just beginning because your spouse is occupying the residence and now you need to buy another one.

Buying A House After Divorce

Why Is That a Problem?

If your name is on the deed and the mortgage, even though you may not be living in the house, you are 100 percent responsible for that monthly payment according to potential mortgage lenders. If your ex has been making that payment, lenders will want proof that he or she has been able to handle the obligation for the past 12 months, and will ask for documentation. Yep—more bank statements, ACH confirmations and cancelled checks for you to dig up.

The bank may even want to see proof of your ex’s income to make sure that you are not making house payments in her name. Then they will probably ask for information about where you are living even if you are renting. Who is paying for that? Can you produce the proper documentation that shows you can handle your monthly rent without assistance?

Co-Sign Home Loan

Even if you can definitively prove that your ex has successfully made 12 months of payments, you could still be denied because you are, in effect, still a co-signer on the mortgage. This can also lead to MN bad credit as your credit score could be impacted.

Alimony and Child Support

Child Support

Not your favorite words, we know, and any court-ordered payment amounts will count against your income and injure your debt-to-income ratios. A $1500 monthly payment can cause outright rejection, or at the least, may cause you to qualify for a much smaller loan amount.

Have You Ever Been Sued?

If you were involved in a divorce you probably were, and must answer this question affirmatively. The answer will need lengthy explanation and can open the door for other queries from the lender.

Divorce Decree

Of course, the lender is going to want to see your fully executed decree; they are not going to take your word for anything.

Joint Accounts

Student loans, credit cards, autos, furniture purchases and more can be considered joint accounts. Even if your ex splits these with you, you will need to get your name off of the ones he or she is now responsible for. Again, if you name is on it, the lender will assume you are responsible for the debt, and you may qualify for nothing.

Joint Bank Account

The Answer: Buying A House After Divorce

When traditional financing brings you roadblocks instead of the key to a new home, there can be answers, and MN contract for deed can be an excellent way to become a homeowner—even if you are in the midst of a divorce. Our experts at C4D, a local Minnesota company, have, over the years, worked out a method to make you a homeowner.

Using MN contract for deed, a legitimate and recognized alternative financing method, we can look past things that traditional lenders can’t. Yes, we still want income proof, you have to have a job, and have to be able to afford your payment. We, however, view these requirements differently than traditional lenders, and we helped many recently divorced persons again purchase homes.

Contact us today to find out the details!

Self Employed Home Loan

Getting A Mortgage Loan If You’re Self Employed

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The age-old self employed mortgage loan issue. You took the plunge and started your own business away from your family and you’re having success. Awesome, right!? Now you are no longer relying on a W2, so there are some hugely important things you MUST know when it’s time to apply for a mortgage.

It was undoubtedly a serious challenge to drive your business from inception to true profitability. You had to find your location—or build your virtual store—find vendors, get permits and licenses, hire your first employees, consult with lawyers and accountants, and then find and retain customers. Now that you are successful and you’re finally feeling better about surviving, why is it so difficult to get a home loan?

Banks Don’t Like You

self employed mortgage loan

Many entrepreneurs report that the initial visit to the mortgage lender’s office isn’t pleasant. Bank officers often cast a wary eye toward small business owners because:

  • Stated income can be difficult to prove.
  • Accounting records may be incomplete.
  • Bankers think small business owners can be riskier borrowers.
  • There is a perception that owner/operators conceal income and avoid taxes.
  • Business owners commonly sign personally for business debt.

But does that mean you’ll never own a home?

Let’s take a look at this scenario: let’s say you’re a small business owner in Denver, Colorado. You might think that you’re stuck renting that one-bedroom Denver apartment forever, since you’re unable to prove income to the bank. So, what are the issues?

Income Issues with Self Employed Mortgage Loan

If you work for someone else, your paycheck goes toward your rent or house payment, car payments, various insurance obligations, repairs, maintenance, etc. If you own a business, however, your business may provide you with a car, a computer, health insurance, life insurance, meals, travel and more.

Self Employed Home Loan

If you make $75,000 per year, for example, you can take your pay stubs to the bank and that will prove your gross income. If your business can produce $75,000 in gross profits, savvy business owners have their business make car and insurance payments directly, and by the time all owner benefits have been deducted, the business may show a much smaller profit, and the owner may legitimately report a smaller income amount. 

Explaining to the banker that your $20,000 income is really $75,000 because of all the benefits your business provides you is not always met with quick acceptance. 

Cold Hard Cash — Good For Self Employed Mortgage Loans?

Let’s face it, although some businesses are becoming cashless, there are usually opportunities for business owners to pocket cash without reporting it as income (make sure you know the rules). Unlikely that the bank will consider any unreported income as valid for the purposes of obtaining a loan.

Cash Money for Home Loan

Lots of Business Debt

While many think that entrepreneurs can obtain business loans without having to sign personally, this is usually not the case, and small business owners many times will have signed for substantial company loans. Banks typically treat these as personal obligations and can count them negatively when figuring debt to income ratios.

What Can You Do?

As you know, we agree that traditional mortgage financing is preferable, but when circumstances cause that route to be difficult, consider giving is a call at C4D. We are MN contract for deed experts and we understand that owning a small business should not be an obstacle to home ownership. We look beyond raw numbers to truly understand your financial situation, and we can work with a variety of circumstances. As our satisfied clients tell us, “Wow, you were able to help us when the bank said no!”

2018 Realtor Tips: Handle Rising Interest Rates

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Rising interest rates in real estate — sounds awful for both homebuyers and realtors, right? Well, you’re in the right place find out. Below, the C4D Crew will outline what factors influence interest rates and what rising interest rates mean for the real estate industry.

The 2008 housing crash was hard enough to deal with. Besides the record foreclosure numbers, Realtors had to deal with very tight lending conditions along with a new and stringent set of government banking regulations. Gone are the days of wild west type appraisals and easily obtained no income documentation loans. While this period has been replaced with a mortgage market some would call the “new normal,” there is an evolving twist MN Realtors now must deal with.

Rates Are Going Up

Mortgage rate predictions for 2018 and 2019

Agency

2018 Prediction

2019 Prediction
Mortgage Bankers Association 4.9% 5.4%
Freddie Mac 4.6% 5.1%
Fannie Mae 4.5% 4.5%
Realtor.com 5.0% No forecast
National Association of Realtors 4.5% 4.8%
Kiplinger 4.7% No forecast
National Association of Home Builders 4.5% 5.0%

Early in the recovery, nicely qualified buyers could actually get 30-year traditional mortgages at rates around 3.25 percent. Now, rates are nudging up to the psychological five percent barrier. Simple math shows us that a $200,000 mortgage at 3.25 percent costs $870.41 per month. At five percent, however, the payment jumps by $203.23 to $1073.64.

To get that payment close to $870.00 with a five percent interest rate, the mortgage amount needs to drop to $165,000. This is a significant 18 percent drop in purchasing power. In other words, a buyer that could have qualified for a $200,000 mortgage at 3.25 percent, now may only be able to finance $165,000.

What Do Rising Interest Rates Mean?

CNBC reported in February:

Sales of newly built homes are falling, and the culprit is clear. Homebuyers increasingly can’t afford what they want. Higher mortgage rates, combined with the loss of homeowner tax breaks in some of the nation’s most expensive markets, are taking away buying power.

Home Sales

Image source: Redfin

Sales fell in December, when the new tax law was signed, and then again in January, when mortgage rates moved higher. Sales are now at their lowest level since August of last year.

“It seems that the jump in mortgage rates in January had an immediate impact on contract signings,” wrote Peter Boockvar, chief investment officer at Bleakley Advisory Group. “You can’t get more interest rate sensitive when it comes to homes and cars with the associated cost to finance.”

What Realtors Can Do

Savvy Realtors need to understand that while upward interest rate trends can be an issue, there are some ways this situation can be managed. Sellers can make things easier by offering to pay closing costs buyers certain remodeling credits, or of course lowering sale prices.

Rising Interest Rates Loan Rejection

Buyers may need to rethink their plans for an ultimate dream home and take an intermediary step instead of a final one. Maybe that $350,000 home will have to wait and a $240,000 will have to work for now.

Make It Happen Now

The upward interest rate trend is no secret, however, and Realtors should push both sides to get deals done before rates rise even more. Lock in today’s rates as soon as possible as each Federal Reserve interest rate hike will do more damage to the housing market.

Consumers Getting Priced Out?

Family Buying A Home

In a rising interest rate environment, more consumers are going to be priced out of traditional mortgage financing, and this is where we at C4D can help. Using MN contract for deed, we make deals happen that banks have refused. We understand bad credit issues, and we want to help ensure that good people that may have had some financial issues are able to become homeowners. Don’t give up on your rejected traditional mortgage deal; instead, bring it to C4D and we will see if we can help.

Actionable Tips For First Time Home Buyers in 2018

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Whew! It seems everything has accelerated in the past couple of years. You graduated from college, got married, landed a nice job, and now there is a child on the way. Your apartment in Chicago on the 32nd floor is just not going to do it anymore, so it’ s time to think about purchasing your first home. Where to even start? Well, how about starting right here. Here are some great tips for first time home buyers.

Tips for First Time Home Buyers: Your Realtor

First Time Homebuyer Broker

Establish a relationship with a buyer’s agent. You’re looking to your agent for tips for first time home buyers, so after you explain your needs and price range, this person will find properties for you to view, make the appointments, keep a record of what you have seen, negotiate deals and write up offers to purchase. And guess what, there is no cost to you, since the seller pays all commission expenses!

Next Tip: Clean Up Your Credit History

Bad MN credit can be a problem as it can injure your ability to get good bank financing at the lowest possible rate. Go to Credit Karma, look at your credit score, view your credit report, and dispute any errors you find.

Tip #3: Pay Down Those Cards

As any Minnesota mortgage lender will tell you, if you have a high credit utilization rate, your projected monthly mortgage payment will be higher. Savvy first time home buyers plan well in advance to reduce credit card balances.

Tip #4: Work on Those Student Loans

As Student Loan Hero tells us:

“Spending a few more years getting your student loans or other debts paid down could mean that you would qualify for a lower interest rate or a higher loan amount. Once you have a better credit history and more secure income history, you will have more options available when you finally are ready to take that leap into homeownership.”

Become aware of the many repayment options available to MN student loan holders, and strengthen your monthly cash flow.

Tips for First Time Home Buyers - Student Loans

First Time Home Buyer Tip #5: Save for that Down Payment

You will be asked to show that you have anywhere from three to ten percent or more down-payment money available. While some lenders allow you to accept this money as a gift from your relatives, others like to see that you have saved it. Few lenders, however, will accept a borrowed down payment. You can also look into something like a home improvement loan as well.

Tip #6: Be Realistic and Discerning

Our friends at U.S. News tell us:

“When you look at houses, focus on the right things. Don’t be distracted by the owner’s odd décor, paint colors, dirty carpet or anything that is easy to change. Granite countertops and stainless-steel appliances are easy to add later. You can’t easily add another bedroom, a better location or a more functional floor plan.”

Tip #7: Be Serious and Ready to Go

Don’t casually look for houses without having a plan to move if you find your dream house. You could find a gem on day one, but be stuck for six months in an apartment lease. Great opportunities may present themselves fleetingly, and you need to be ready. But be prepared to take some time to shop around for home insurance — don’t forget about this!

Tip #8: Check Out the Neighborhood at Different Times of Day

That nice, quiet three-bedroom dream home may turn out to be a nightmare if you only saw it on a quiet Sunday afternoon. Check traffic patterns and activity at different times before you make an offer.

Tip #9: Talk to the Neighbors

Homebuying Neighbors

No one can give you a more realistic view of the area than someone that has lived there for years. Knock on doors, talk to people you see, and frankly ask them if the neighborhood is a good place to live. You’d be surprised at the genuine answers you will receive.

Be sure you check in on the home and neighborhood safety as well. You don’t want to become just “another statistic.”

Final First Time Home Buyer Tip: Don’t Give Up

If you have found your dream home, but have been turned down for conventional financing, there are alternatives. C4D, our company that specializes in helping those with bad credit in Minnesota, may be able to help you find your path to home ownership through a contract for deed. Go here to find out more about this legitimate and widely used method that can get you into a home even if you have credit issues.

And if you’re looking for even more tips for first time home buyers, you can check out some more great information from our friends over at Bankrate. They have a fantastic blog post which shares many more tips for first time home buyers. You can check it out here.

Tips to Become the Top Realtor in Your Area in 2018

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How to be successful in real estate? This is an extremely common question in the industry. Many real estate pros watch glamorous TV shows like Million Dollar Listing New York, House Hunters, Designed to Sell and many more. These same people would love to achieve the amount of success as many of the real estate superstars on TV. So what does it take? Is it luck? Right place and right time?

Well, there’s lots of competition in the Minnesota and Minneapolis real estate space but by following some proven business practices, you can rise to the top. From client/customer service to quality networking, let’s look at the things that can make you a top MN realtor.

How To Become Successful In Real Estate

The “t” word—transparency—has almost become a cliché, but beginning with the first Minnesota Realtor client meeting you need to be honest and forthright about expectations and costs. If the stats show that it may take 47 days to move a client’s property, don’t give then the impression that you can sell it in a week, unless, of course, you really can.

New sellers may not fully understand the commission process, and you should take some time to explain it. There may be confusion about how you share your commission and who you share it with. With median housing prices rising, the standard six percent commission can easily reach $20,000 or more, and if you have to split your commission with another broker and/or you company, your clients should understand that you don’t pocket the entire amount.

Look Like a Professional

While business casual may be sufficient in your area, showing up at a client meeting in cutoffs and a t-shirt is probably not the way to go. Then again, some will advise to dress how your clients dress. Either way, you know if you have a huge prospecting meeting that you should probably throw on your business suit and dress as professionally as possible. Projecting a professional image is critically important for real estate professionals.

Return Calls and Emails Promptly

As you undoubtedly understand, great Realtors are always working, and their clients want immediate answers. When there is a pending offer, clients on either side can get extremely hyper, and they probably won’t adhere to “normal business hours.” Have a thorough voicemail message that explains exactly when your clients can expect a return call:

“Hi – it’s Maryann. You have reached my voicemail because I’m speaking with another client or in a meeting. If you are calling before 7:00 p.m., I will return your call today. Otherwise, expect a call from me tomorrow. Please do not hesitate to text as I may be able to respond quicker that way. Also, feel free to email me at maryann@gmail.com. Regardless, I guarantee a response within 18 hours.”

This may seem basic and academic but it’s very important to do correctly.

Real Estate & Digital Media

You need a website, but a bad site with a terrible user experience and functionality may be worse than having none at all. As commonplaces.com says,

“Your website is no longer a URL at which you park the existence of your online business. It’s often the first and most powerful presentation of your business – who you are as a company, what you offer, and why your products and services are better than all the rest.”

Make sure that you find a quality developer, especially one that has experience with Realtor websites. And if you need more advice on the big picture of real estate digital media, below is a video from Million Dollar Listing star Ryan Serhant and social media influencer Gary Vaynerchuk on the state of real estate in 2018.

Social Media Presence & Brand Building

Gone are the days when a home buyer just opens up a newspaper, looks for properties, calls an agent from a phonebook and makes an offer. Buyers today are looking online more than ever. From review websites like Yelp to social media profiles like Twitter, Facebook, Instagram, LinkedIn and YouTube it is imperative that Realtors use social media to communicate with potential buyers. For example, if you worked at PlateJoy, you’d want positive platejoy reviews, right? The same goes for Realtors.

Digital Media For Real Estate

Some tips include:

  • Posting photos on Instagram to generate leads
  • Creating a content presence on Facebook
  • Tweeting to promote listings to your audience
  • Guest posting to collaborate with other local real estate pros
  • Sharing your content on LinkedIn with your industry connections
  • Reply to everyone and create a sense of community

Monthly Newsletter

It’s critically important for clients and potential clients to know how to find you. Start compiling an email list from day one, and send out a carefully crafted and informational newsletter. Again, you may think that this is Realtor 101, but you might be surprised at the number of your colleagues that fail to do this, start and then stop, or send out junk. A great monthly blog sent out in your newsletter will keep your name fresh.

Monthly Real Estate Newsletter

How To Be Successful In Real Estate: Financing

Of course, you know the deal isn’t done until funds have been wired. Savvy Realtors immediately begin building their financing network, and they know who will work hard to get marginal MN bad credit loans approved. You need to assemble your financing team, and have a go-to lender available for each particular situation, and here’s where we can help. We at C4D are MN contract for deed specialists, and every day we work with clients to make the home ownership dreams a reality. If you have difficult or even rejected financing deals, let us take a look and see if we can help. Please contact us for further information.

Buying a House After Foreclosure

Buying After Foreclosure: Your Next Steps

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While many people think that foreclosure, like bankruptcy, signals financial death, this is simply not true. The chart below shows that distressed Minnesota home sales have significantly fallen, but if you lost your home to foreclosure, contrary to what you might have read, you may find yourself in the market for buying a house after foreclosure.

Distressed Home Sales

What Is Foreclosure?

Our friends at Investopedia define foreclosure like this:

Foreclosure is the legal process through which a lender seizes a property, evicts the homeowner and sells the home after a homeowner is unable to make full principal and interest payments on his or her mortgage, as stipulated in the mortgage contract.

Here’s why it might have happened to you.

Buying A House After Foreclosure: The Reasons

You may have faced foreclosure for one or a combination of the following reasons:

  • Major illness
  • Job loss
  • Spousal death
  • Predatory mortgage practices
  • Adjustable rate loans
  • Unexpected relocation
  • Divorce
  • Excessive credit card debt
  • Lots of student loan debt
  • MN Bad credit

Regardless of the cause, you can take steps now to first rebuild your credit, and subsequently find yourself buying a house after foreclosure.

Credit Repair

Credit Repair for Foreclosure

The first thing to do is repair your credit. If you have overwhelming debt and are continually making payments late, it will be difficult to make progress. It is important to become cash flow positive in order to begin chipping away at your debt, and a legitimate credit counselor or a good financial advisor can help you here. If you don’t feel that you will ever be able to get out from under your particular debt situation, bankruptcy may be an option since this would give you the proverbial clean slate to begin again.

Everything Has Its Price

If you have gone through foreclosure, you already know that foreclosure will quickly drop your credit score – maybe 100 points or more. Bankruptcy can do the same thing, so there will be a time period when no one wants to lend you any money. You can rebuild your credit but it means being diligent and taking small steps. This FICO chart explains what categories constitute your credit score:

Buying A House After Foreclosure

Get A Card

The first way to repair your MN bad credit is to get a credit card. This may have to be a secured card; in this situation you deposit money with the credit card company and basically borrow against it. You do this because if you make on-time payments, these will be reported to the credit bureaus, and your credit score will rise. Make sure you are never late on any payments, and that you do not make the same mistakes that got you into trouble the first time.

Time Is Your Friend

If three years have passed since your foreclosure and you have had stellar credit since that time, it will be possible for you to get a mortgage.  You probably will have to come up with a 10 percent down payment, and lenders will be a lot happier if they see that you have saved that amount. Still, you will face a load of scrutiny, and you will pay a higher loan interest rate. You may be turned down by a number of lenders, and that can be a frustrating process. Keep in mind, you can find ways to make quick cash. For example, you could use the ibotta referral code to save a few bucks and get your finances in order.

Contract for Deed Financing

This is where your friends at C4D can help. We are a legitimate Minnesota business that helps people with bad credit issues, and we help them become homeowners. Our process looks like this:

  • You find your dream home.
  • You fill out our online application.
  • We contact you.
  • We determine if we can help.
  • If so, we buy the home.
  • Then we sell it to you utilizing a MN contract for deed.

Please feel free to contact us if you have any questions. Bankruptcy and/or foreclosure are traumatic financial events, but you can certainly recover from them, and we are here to help!

Buying A House In Minnesota

Buying A House In Minnesota: The True Cost

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You already know that home buying a house in Minnesota is complicated, but if you haven’t been through the process there are many details you need to be aware of. Even if recently you bought a car and felt like you were on your game at the dealership, buying a house is definitely like playing in another league.

Here’s what you really need to know:

Everyone Likes to Get Paid

Home deals regularly generate multi-hundred thousand-dollar deals, and lots of people want a piece of that. Lawyers, Realtors, title companies, surveyors, paralegals and even more groups are all in the hunt for your money, so let’s look at some of the costs.

Realtor Commission

Buying A Minnesota House Realtor Commission

Standard real estate commissions are six percent of the total deal with the amount split between Realtors or real estate agents involved. Even though this amount is almost always paid for by the seller, you can bet that it has been rolled into your purchase price.

Title Policy

When you buy a property, you must be sure that you are not purchasing someone else’s problems. Title companies insure that you will have a clean title; if something comes up later—like a lien the title company did not uncover—the title company will have to make things right at their expense. This can cost you $1500 to $2000, however.

Document Preparation

Lending institutions love to charge for you document prep, even if they are only cutting and pasting into a form document. This can set you back $500 or more.

Attorney Review

The same goes for the cost of having the bank’s lawyer review the deal. This can cost $150 – $500. And if you need more information about real estate law, check out this real estate law resource.

Buying A Minnesota House Using Attorney

Underwriting Fees and Application Fees

Lenders also may charge you random amounts for merely applying for your loan. The due diligence they normally perform is often charged as an underwriting fee.

Fee For Buying A House in Minnesota

So, you go to the bank, they approve your loan and they give you an interest rate. You’re done, right? Not so fast, because the bank many times will charge a fee to lock in your interest rate for a fixed time period. Don’t forget to include this fee in your budget!

Origination Fee

This is free money for the bank. They may charge one percent of your total loan just to give you the privilege of borrowing money! If you need a more clear definition of the origination fee, you can take a look at this resource from Investopedia.

Discount Fee

Mortgage Interest Rate

If you want a lower interest rate when you’re buying your house in Minnesota, you can pay upfront. This is sort of like the $199 per month car payment that requires $3,000 at signing. And when it comes to your interest rate, take a look at a few of the major factors that determine the actual rate.

Credit Report Fee

The bank can access your credit report for free—so can you at Credit Karma—but they might charge you 35 bucks anyway. Remember, pay your bills on time, take out smart loans for other purchases and make sure you keep track of changes to your credit score. It’s a very important piece of the home buying process.

Homebuying Credit Score

Appraisal

You know that you are buying a house in Minnesota at market rates, but your bank wants to be sure, so they will send a $500 appraiser out to confirm that the sales price meets the neighborhood comps—of course at your expense. For more information about what an actual appraisal means, check out this real estate appraisal resource from Wikipedia.

Home Buying Appraisal

But Wait

That’s not all as the bank may even charge you a wire fee to send your loan proceeds to the seller. Creative financial institutions are constantly looking for more ways to add costs to your home buying transaction, and you may be even charged a signing fee for executing your loan documents!

Having Trouble?

Remember, traditional financing for buying a house in Minnesota isn’t always the only way to go. We at C4D make home ownership possible through MN contract for deed. If you are having trouble with the bank, have large student loan debt, have MN bad credit, have liens, judgments, or just need an alternative financing solution, be sure to contact us; we’ll do everything we can to make your home ownership dream come true.

Bad Credit Home Financing: The Bad Credit Blues

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So, you’re at a company happy hour listening to your co-workers talk about their new home purchases. Becky just closed on a four-bedroom steal close to downtown and is looking for remodeling contractors. William finally finished a complicated deal where he traded a rental property and another investment property for equity in a new home. Stephanie has perfect credit and her husband works at Goldman so she’s complaining that she can no longer get a mortgage rate below four percent.

And you’re still in your cramped old apartment on 10 1/2 Ave S. in St. Cloud. You have student loans, a couple of late credit card payments, a few parking tickets that have gone to collection, a delinquent hospital bill from when you drunkenly fell on the sidewalk, and you’re just thinking, “WTF, am I ever going to be like everyone else? I’ll be renting forever.”

You’re thinking that bad credit home financing is impossible.

Bad Credit Home Financing

There’s Always a Way

Lots of famous people have said, “don’t give up,” and while we’re sure you don’t want to see their names listed here, the basic premise is true. If you have MN bad credit, if you have been turned down for a mortgage, if the only credit card offers you get are from an Indian Reservation in South Dakota, and if the only auto dealer that will talk to will happily sell you a used car — but at 29 percent interest — YOU CAN STILL OWN A HOME!

Home Financing Credit Issues

Alternative Financing

 Creative people find creative ways to get a home purchase accomplished, and here are some ways to try:

  • Get a co-signer
  • Fix your credit
  • Have someone else buy it for you
  • Win the lottery (yeah, sure…)
  • Investigate rent-to- own
  • Engineer a contract for deed sale

Bad Credit Home Financing … Yeah, Right 

OK, so one through four above are long shots like Colin Kaepernick getting picked up by New England next year, but the last two methods can work. Wikipedia defines rent-to-own this way:

Rent to Own Bad Credit Home Financing

“Rent 2 Own also known as rental-purchase, is a type of legally documented transaction under which tangible property, such as furniture, consumer electronics, motor vehicles, home appliances and real property, is leased in exchange for a weekly or monthly payment, with the option to purchase at some point during the agreement.”

That’s all well and good, but there are some issues here. Miss a payment and you’re gone. You’re not really gaining equity—just some down-payment dollars. There are lots of scams that have been traditionally associated with rent-to-own.

The Better Choice

To be honest we really like contract-for-deed. In Minnesota, it’s a very popular home financing method. It’s regulated, it’s not uncharted territory, and many, many people have found their way to home ownership through contract for deed MN. There is a great place to find out valuable info regarding this often-used financing method, and that is C4D. We are reputable, know what they are doing, and have a really informative website. Whether you work with us or not, realize that there are ways to get a home — just be diligent, creative, and do some research.