Minnesota Housing Finance

Balance Transfer and Housing Finance

By Addi Vardhaman

The Indian immovable property has come of ages. Consumer is the King now and gone are the days of monopolistic behavior. And definitely, if you are the one with sound financial background and impeccable credit record you can strike a better deal with the banks in terms of interest rates and other payment conditions and purchase your dream property without any hassle.

Interestingly, the same criteria is equally applicable on those, as well, who have already availed a loan from a bank. Near about all the major public and private sector banks in the Indian banking system are now offering the option of ‘Balance Transfer’ on housing finance. Often, banks in the housing finance sector tend to increase the interest rates when the benchmark interest rates increase. But, such alacrity is not shown by them in decreasing rates whether the Repo rate comes down or not. In such circumstances, balance transfer help the customer a lot. He can replace the higher rate loan and avail a lower rate one by paying some extra charges. These charges are lower compared to the total payable interest.

What is Balance Transfer and how is it relevant in the housing finance?

There are times you find that the interest rate on your home loan is at a higher level. Take an example. Suppose you were paying at the rate of 10.5 per cent per annum. This rate is quite high in comparison of 9 per cent offered by some other bank. In such cases balance transfer of housing finance comes into rescue. You can trigger off the balance transfer option with your existing bank or lending institution, under which the unpaid portion of your housing finance would get transferred to your desired bank, thereby taking benefit of the difference in the housing loan interest rate.

Things to take care of at the time of balance transfer:

* Tenure of loan amount should be taken care: Ideally, you should consider taking the balance transfer option when the remaining part of your payment period is more than 5-years and in such a case you have the time for speculative gains. There is no profit in transferring the home loan from one bank to another if you end up paying early payment penalty and other processing charges even more than the difference of housing loan interest rate and the amount you had to pay towards interest in the normal condition.

* Early Payment Charges associated with the housing finance scheme: Banks like State Bank of India, IDBI and ICICI offer benefits like exemption of the early payment charges to your existing bank if you transfer the balance. So you must confirm the same with the new lending institution that are they ready to deal with this matter. Otherwise, the deal is not profitable.

* Additional charges involved with the loan amount: You must confirm that the desired amount for your home purchase loan is perfectly at par with the balance you had in your previous bank. It may be the case that that your new bank pays all early payment penalties and processing charges on your behalf and later add the amount to the principal of your housing loan. So, in such case your total owing remain the same and the transfer is not profitable. In this situation, you have to suffer the impact of debt compounding, which does not favour you in the long run.

Seeking balance transfer as a burden reduction option needs the similar degree of caution and study that you undertake while taking housing finance. Definitely with balance transfer, you can save a considerable amount of interest charges under this option once you strike the right chord!

About The Author: For more information about home loans. Please visit our website: http://www.paisawaisa.com/

Article Source: http://EzineArticles.com/?expert=Addi_Vardhaman
http://EzineArticles.com/?Balance-Transfer-and-Housing-Finance&id=1337511

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Housing Finance – A Revolution In The Market

By Aditya Jaiswal

The housing finance in India is growing at a fast pace. The home loans or housing finance is a huge industry in itself. A lot many people are trusting home loans in India to purchase property. This is the best and affordable way of realizing your dream of buying your own home. These finance options are open for all salaried individuals, self-employed individuals, partnerships, and even NRIs. The home loan can be availed for various purposes like loan for building a house, purchasing a piece of land, buying an existing house or apartment, and renovating a house.

The home loan can be availed for all kinds of properties like residential, commercial, and industrial. The loans for industrial and commercial property are of huge size and are normally taken by organizations. People also take home loan for the purpose of investment in property rather than for their own use. These properties are later on sold in the market at good profit.

Apart from a normal housing loan one can also get home equity loan, a unique concept wherein the borrower can mortgage his existing property to avail loan that can be used for any kind of purpose as desired by the buyer. Generally, people avail home equity loan facility for the purpose of marriage, education, or to meet medical expenses. The maximum loan amount that banks normally offer is about 60% to 65% of the market value of the property. The home equity loan is generally provided on difference amount of the actual market value of the property and the amount the customer already owes to the bank. At one time this concept of borrowing was not much known but today it has become quite popular as the funds can be put in use as per the wish of the customer.

The housing finance companies follow a very strict process while providing loans to the customers. The loans are disbursed in line with the credit policies of the bank and financial institution. As part of their process, banks verify the credit history of the borrower to ensure safety of the funds. It is important to check whether the customer is a defaulter with some other financial organization or if he has misused any of the banking products.

The housing finance sector is being promoted in a big way in India. The banks and financial institutions are offering home loans at attractive terms. Even people find it advantageous to purchase property by availing home loan as they get tax benefits and easy repayment options. This is the best way to buy a property especially if you belong to service class. The banks and housing finance companies are also being professionally managed. They are always ready to assist the customers regarding queries related to the prevailing rate on interest, the various tenures available for repayment, conditions or the eligibility criteria for various categories of customers, the documentation required etc. It will not be wrong to say that housing finance in India has caused a revolution in the market and has motivated purchase of properties.

Aditya Jaiswal, advisor of home loans for NRIs, is an associated editor with the site: www.guide2homeloan.com The site is an online portal to provide home loan advice on home loans in India including types of home loans in India, home loan interest rates in India provided by home loan providers in India.

Article Source: http://EzineArticles.com/?expert=Aditya_Jaiswal
http://EzineArticles.com/?Housing-Finance—A-Revolution-In-The-Market&id=397589

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Check Out Energy Rebates

EnergyStar.gov –  Check Out Energy Rebates

This is a government site that offers lots of energy saving tips as well as explains what energy saving grants or credits might be available.

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Foreclosure Trends Newsletter

Here is the latest issue of my foreclosure trends newsletter.  As you can see, the trend is not our friend, in the sense that the housing market has not recovered.  Until jobs come back and people are employed and feel safe in their employment, they will tend to avoid making a committment.

ForeclosureTrends.pdf

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Twin Cities Foreclosure Trends-From our MLS & Realty Trac

Besides the board of realtor sites:  http://theThing.mplsrealtor.com and market data posted elsewhere at http://www.MplsRealtor.com I have a subscription to Realty Trac.  My subscription gives me additional data about foreclosures and trends within certain zip codes.  This is in addition to my daily subscription to Finance & Commerce (a business newspaper that prints all the foreclosure information as well as very timely articles regarding the business community).  If you are looking for someone who has experience and access to information about distressed sales, we need to be working together.  Whether buyer or seller-I can help you understand the market we are in and the options and opportunities available to you.  Give me call today.

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Real Estate Information

These are a couple of my newsletters that have a ton of valuable information. Go check them out.

Foreclosure Market Trends Newsletter
http://www.realtytrac.com/MarketTrends/NewsLetter.aspx?guid=131bd355-1b69-4bd1-99cd-2f0c9a936810

Real Estate Cyber Space Tips
http://www.REcyber.com/cybertips/r11627

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Minnesota Mortgage – What to Expect When Buying a Home in Minnesota

By Jessica Elliott

Maybe you’re buying your first home in Minnesota, or perhaps you’re relocating to Minnesota from another state. Either way, it’s important that you educate yourself on Minnesota home loans before shopping for a home and mortgage. This article explains what you’ll need to know before buying a home in Minnesota:

The median price of a home in Minnesota is $122,400. The price of homes in Minnesota varies widely between zip codes. For example, in Minneapolis, Minnesota, the median price of a home in the summer of 2005 was $320,000; however, in Plymouth, Minnesota, the median price of a home was $214,000, and in Forest Lake, Minnesota, it was $225,000. Average interest and job growth rates in South Dakota are both below the national average.

Minnesota law prohibits the financing of points and fees on a mortgage that are more than 5% of the loan amount. Additionally, Minnesota limits the ownership of agricultural land to U.S. citizens and permanent residents, and corporations owned at least 80% by U.S. citizens and permanent residents.

The state of Minnesota does not regulate home radon levels. This means that home buyers must test for radon levels in the home they are purchasing and decide for themselves how much radon is acceptable in their home.

Jessica Elliott recommends that you visit Mortgage Lenders Plus.com for more information about Minnesota Mortgage Rates and Loans.

Article Source: http://EzineArticles.com/?expert=Jessica_Elliott
http://EzineArticles.com/?Minnesota-Mortgage—What-to-Expect-When-Buying-a-Home-in-Minnesota&id=263529

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Outstanding Video-An Inspiration To All-Be The Best You Can Be!

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Twin Cities Home buyer book

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.

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Tax Credits for Solar Water Heaters

Article From HouseLogic.com

By: Donna Fuscaldo
Published: October 22, 2009

A federal tax credit makes energy-efficient solar water heaters a more affordable and sustainable option for many homeowners.
A solar water heater uses the renewable thermal energy produced by the sun to warm water for your shower, washing machine, and dishwasher. Better yet, it does it at a fraction of the price of a conventional storage tank water heater. If you take the plunge and purchase a solar water heater, expect to see your home’s water-heating bill cut in half.

The financial attraction doesn’t end there. A federal energy tax credit that’s available through the end of 2016 allows homeowners to shave 30% off the cost of a solar water heater. Even new homes and second homes qualify.
How solar water heaters work

Solar water heaters operate (http://www.energystar.gov/index.cfm?c=solar_wheat.pr_how_it_works) in one of two ways: either as a direct system or as an indirect system. A direct system warms water by circulating it via pipes through rooftop solar collectors. An indirect system, also known as a closed-loop system, relies on a non-freezing heat transfer liquid.

The liquid is heated in the solar collectors and returns through pipes to a storage tank, where a heat exchanger inside the tank transfers the heat to the water. Most systems rely on electric pumps to move water (or a transfer liquid) between the storage tank and the rooftop solar collectors.

In general, solar water heaters can be used anywhere as long as your roof gets direct sunlight for most of the day. The rooftop collectors should face south. A direct system makes sense in warm climates where temperatures don’t fall below freezing. The non-freezing liquid used in an indirect system makes it better suited for cold climates.

You’ll need to retain your conventional water heater as a back-up at night, on cloudy days, or anytime a solar water heater’s capacity is exceeded. An average person uses about 15 to 20 gallons of water per day, so a family of four would likely need an 80-gallon water heater tank.

The cost of a solar water heater

A solar water heater starts at around $4,000 including installation, though the price tag could double depending on the size, quality, and complexity of the system. Figure it’ll take two to four days to install.

There’s no cap on the 30% federal tax credit, which applies to systems placed in service between Jan. 1, 2009, and Dec. 31, 2016. Solar water heaters must be certified by the Solar Rating & Certification Corp. (http://www.solar-rating.org/) to qualify. States may offer additional incentives. Check the DSIRE database (http://www.dsireusa.org/).

To earn the federal tax credit, at least half of your household’s energy for water heating must come from the sun. You can only count money spent on the solar water heater, not the entire heating system. You can’t claim the credit if the solar water heater is for a pool or hot tub.

Take the credit on IRS Form 5695 for the year you install the solar water heater. Remember to save receipts and manufacturer certification statements. The credit can’t exceed the total amount you owed in federal taxes for the year.

The savings can add up

According to Energy Star, a federal program that promotes energy efficiency, a solar water heater can lower the average household’s water-heating costs (http://www.energystar.gov/index.cfm?c=solar_wheat.pr_savings_benefits) by 50%. If you use a gas water heater, that translates to savings of $190 a year. You’ll save $265 annually if you have an electric water heater.

Savings are greater for large families that use a lot of hot water. How quickly you recoup your total investment depends on how much water you use, the amount of sun you get, the performance of your solar water heater, and how much it costs to heat up your water using your existing system.

If you’re building a new home or refinancing your mortgage, consider lumping in the cost of a solar water heater with the loan. By spreading the cost (http://www.energysavers.gov/your_home/water_heating/index.cfm/mytopic=12860) of the system over the life of your mortgage, you can take advantage of the tax deduction (http://www.houselogic.com/articles/deduct-mortgage-interest-home-equity-loans/) for mortgage interest.

According to the U.S. Department of Energy, you’ll pay an extra $13 to $20 per month to include the cost of a solar water heater in a 30-year mortgage. With the mortgage interest deduction that cost gets reduced by $3 to $5. The difference is about what you should save on your monthly energy bills.

Long life, little TLC

Solar water heaters have a life expectancy of 20 years or more, double that of conventional storage tank water heaters. They typically don’t require replacement parts for the first 10 years. It’s prudent to hire a qualified contractor to conduct annual inspections, as you might do with a furnace.

You can do your part by making sure the collector is clean, sealings aren’t cracked, and fasteners connecting the collector to the roof are tight. Whether for installation or maintenance, look for contractors certified by the North American Board of Certified Energy Practitioners (http://www.nabcep.org).

Solar water heaters not only save money-they save the environment. The DOE says a solar water heater can cut the electric load of your water heater by 2,500 kilowatt hours annually, which prevents 4,000 pounds of carbon dioxide from entering the atmosphere. That’s equal to not driving your car for four months a year.

This article provides general information about tax laws and consequences, but is not intended to be relied upon by readers as tax or legal advice applicable to particular transactions or circumstances. Readers should consult a tax professional for such advice, and are reminded that tax laws may vary by jurisdiction.

Donna Fuscaldo has written about alternative energy for Dow Jones, the Wall Street Journal, and Fox Business News for more than a decade. She’s currently renovating her house with an eye toward energy efficiency and green technologies.

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

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Tax Credits for Replacing Your Roof

Article From HouseLogic.com

By: Gil Rudawsky
Published: September 16, 2009

Replacing your roof with a qualifying energy-efficient metal or asphalt roof can cut your cooling bill and earn you a $1,500 tax credit.

The roof of your house protects against more than rain. The sun’s rays beat down relentlessly, especially during summer. The intense heat can raise the temperature inside your home.

Proper venting and insulation help keep the cool air in and the warm air out. So, too, do energy-efficient roofing materials, which take the brunt of the solar onslaught. Uncle Sam is encouraging homeowners to improve the roofs of their primary residences with a tax credit worth up to $1,500.

During 2009 and 2010, you can claim a credit for 30% of the cost of qualifying asphalt or metal roofing materials. The credit, which should be taken on IRS Form 5695 for the tax year in which the work is completed, can be split between 2009 and 2010 but can’t exceed $1,500 total for both years. You can’t claim more in credits than you owe in taxes.
Metal vs. asphalt roofs

To qualify for the tax credit, you must use either metal or asphalt roofing materials that are designed to reduce heat gain-the amount of heat transferred into a home-and meet the requirements of Energy Star (http://www.energystar.gov), a federal program that promotes energy-efficient products and practices. Metal roofs must have appropriate pigmented coatings and asphalt roofs must have appropriate cooling granules. Asphalt materials can be either traditional shingles or modified bitumen (rolled asphalt sheets). Energy Star has a list (http://downloads.energystar.gov/bi/qplist/roofs_prod_list.pdf) of all of its approved roofing products, but only the metal and asphalt materials may qualify for the tax credit.

It’s a good idea to hang on to manufacturers’ certification statements (http://www.gerardusa.com/Energy%20Star/ESTaxCert.pdf) that attest to the tax credit-worthiness of the roofing materials you purchase. These can usually be found on product packaging or company websites. You don’t need to file these with your tax return, but the IRS could ask for them later. Consult a tax adviser.

Dean Kucharski, a 22-year veteran of the roofing business in Pontiac, Mich., estimates that for a typical 2,200-square-foot home, a mid-range asphalt roof will run about $7,000 to $12,000, including labor. The good news is that it will likely last 20 years or more. For a metal roof, expect to pay twice as much, though it can last for 50 years, he says. If you hire a contractor, get an itemized bill that breaks out the cost of materials since labor doesn’t count toward the tax credit. Materials should account for about half the bill on standard roofing jobs.

How much roof do I have?

You can get a rough estimate of how much roofing material you’ll need by figuring the square footage of the footprint of your home and adding about one-third more to account for roof pitch, overhangs, dormers, gables, and so on. Roofing contractors often quote in terms of “squares.” One square equals 100 square feet. So if a roofer says your house is 20 squares, it means it’s roughly 2,000 square feet-20 times 100.

Once you’re ready to pick a roof type, Kucharski suggests talking to an area building wholesaler or a company that specializes in roofing materials. It’s important to consult with someone who knows what types of materials are appropriate for a given region’s climate. Big-box retailers may not have as wide a selection or knowledgeable staff.

Finding a good roofer entails the same steps as finding any qualified contractor: ask neighbors for recommendations, collect at least three bids, check references, and get everything in writing. Craig Silvertooth, executive director of the Center for Environmental Innovation in Roofing (http://www.roofingcenter.org/), recommends finding a contractor through the National Roofing Contractors Association (http://www.nrca.net/), which has about 4,000 members.

Save on cooling bills

You’ll get the most bang for your roof-renovation buck if you live in a hot climate, namely the South and Southwest. Expect to save between 7% and 15% on your cooling costs with energy-efficient roofing materials, says Michelle Van Tijen of the Cool Roofs Rating Council (http://www.coolroofs.org/). If you pay $300 a month to cool your home, figure you’ll cut your monthly bill by up to $45.

Ironically, with roofs there is such a thing as being too energy efficient. In winter months, roofing materials with very high heat-deflecting qualities can increase heating bills. However, you’re more than likely to make up the difference on your air-conditioning costs. That’s especially true if you live in an area where you run your air conditioner much of the year.

Think hard before replacing a roof that’s in perfectly good shape. Consider instead a roof coating, a material painted over your existing roof that offers insulation and sun reflection, says Silvertooth. Roof coating costs about 75% less than replacing a roof, though it doesn’t qualify for the tax credit. Another affordable way to save on cooling costs that doesn’t even involve the roof is to add more insulation (http://www.houselogic.com/articles/tax-credits-adding-or-replacing-insulation/) to your attic. This home-improvement project can even be tackled by weekend warriors, and it qualifies for a federal tax credit.

This article provides general information about tax laws and consequences, but is not intended to be relied upon by readers as tax or legal advice applicable to particular transactions or circumstances. Readers should consult a tax professional for such advice, and are reminded that tax laws may vary by jurisdiction.

Gil Rudawsky has been covering business and consumer issues as a reporter and an editor for 18 years, most recently as a business editor at the Rocky Mountain News. He lives in a house built in the 1930s, and always keeps the home’s character in mind when making upgrades.

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

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Tax Credits for Replacing Windows, Doors, and Skylights

Article From HouseLogic.com

By: Gil Rudawsky
Published: September 09, 2009

If money seems to be escaping through drafty windows, doors, and skylights, this federal tax credit might make energy-efficient replacements more affordable.

Does it feel like money is escaping through your home’s drafty windows, doors, and skylights? You might be able to keep at least some of that cash in your pocket by taking advantage of federal energy tax credits for retrofitting your house with qualified energy-efficient replacements. You can claim a tax credit of up to $1,500 for upgrading the windows, exterior doors, and skylights in your primary residence during 2009 and 2010.

The credit is based on 30% of the cost of materials, so a $5,000 purchase would max it out. But a tax credit alone isn’t reason enough to start calling contractors. Do a little homework first. The true value of replacing aging windows, doors, and skylights isn’t always an open-and-shut case.

Follow the 15-year rule for windows

A good rule of thumb for window replacement: Don’t bother if they’re less than 15 years old, says Jim Rooney, a home inspector in Annapolis, Md. The savings on your energy bills likely will be negligible since window technology hasn’t changed that radically and the integrity of your windows should still be intact. Shoddy installation or poor manufacturing may call for exceptions to the 15-year rule. Windows that are 20, 30, or more years old are prime candidates for replacement.

Most of your focus should be on windows, since they’re more numerous, but skylights are notorious for energy loss too, not to mention water leaks. Exterior doors tend to outlast windows, so keep them unless the upgrade is purely for aesthetic reasons. Besides, weather stripping and snug sweeps can boost the energy efficiency of exterior doors for a whole lot less money.

Adding up the costs-and savings

With windows, doors, and skylights, you get what you pay for. Expect to shell out between $500 and $1,000 per window including installation, or about $10,000 total for a moderately sized house of about 2,000 square feet. New energy-credit-qualified doors and skylights are also in the $500 to $1,000 range, including installation.

Tom Herron, of the National Fenestration Rating Council (http://www.nfrc.org), says products on the higher end of the cost scale are usually better constructed and more energy efficient. NFRC is a non-profit organization that administers the rating and labeling system for the energy performance of windows, doors, and skylights.

It could take years to recoup the upfront costs, but you should see an immediate reduction in your energy bills. In general, you’ll save $126 to $465 a year if single-pane windows in a 2,000 square foot house are replaced with tax-credit-eligible windows, according to the Efficient Windows Collaborative, a trade group. That’s 15% to 40% off the typical energy bill.

Do my replacements qualify?

A label alone doesn’t guarantee your new windows, doors, and skylights qualify for the energy tax credit, but it does provide critical information related to eligibility. To qualify, windows, doors, and skylights must have a U-factor (http://www.efficientwindows.org/ufactor.cfm) of 0.30 or less and a Solar Heat Gain Coefficient (http://www.energycodes.gov/support/shgc_faq.stm) (SHGC) of 0.30 or less. The U-factor measures how well a product prevents heat from escaping, and the SHGC gauges how well a product blocks heat from the sun. Labels also carry information on light transmission, air leakage, and condensation resistance.

Herron, of the NFRC, says about 80% to 85% of the manufacturers in North America provide NFRC labels. All Energy Star qualified windows carry an NFRC label (http://www.nfrc.org/Label.aspx), according to Energy Star, a joint program of the U.S. Department of Energy and the U.S. Environmental Protection Agency that promotes energy-efficient products and practices.

Resist the urge to trim costs by purchasing cheaper windows, doors, and skylights with poor U-factor and SHGC ratings. Not only will you miss out on the tax credit, energy bills won’t come down much.
Taking advantage of the tax credit

A credit is especially valuable because it directly reduces the amount of tax owed, as opposed to a deduction, which lowers the amount of taxable income. To be eligible for the full credit you must owe more in federal taxes than you’re trying to claim. Use IRS Form 5695 to take advantage of the credit, which is cumulative for 2009 and 2010 only. You can’t claim $1,500 for each tax year, but you can spread the $1,500 over the two-year period.

Uncle Sam may want proof that your new windows, doors, and skylights meet energy-efficiency standards, so be sure to save receipts, product stickers, and certification statements. The latter can often be found on packaging or manufacturers’ web sites. As for receipts, ask contractors to itemize expenses. Installation costs aren’t eligible for the credit; only materials are.

Keep in mind that a variety of energy-efficiency improvements to your existing home, including insulation, roofs, and HVAC, count toward the credit limit. You can’t claim separate $1,500 credits for each upgrade, nor can you claim the credit for a newly built home. Matt Golden, president and founder of San Francisco-based Sustainable Spaces (http://www.sustainablespaces.com), says homeowners can often lower energy costs for a lot less, and still get the tax credit, by insulating attics (http://www.houselogic.com/articles/save-money-with-insulation-upgrade/) instead.
This article provides general information about tax laws and consequences, but is not intended to be relied upon by readers as tax or legal advice applicable to particular transactions or circumstances. Readers should consult a tax professional for such advice, and are reminded that tax laws may vary by jurisdiction.

Gil Rudawsky has been covering business and consumer issues as a reporter and an editor for 18 years, most recently as a deputy editor at the Rocky Mountain News. He lives in a house built in the 1930s, and always keeps the home’s character in mind when making upgrades.

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

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Tax Credits for Replacing Heating and Cooling Systems

Article From HouseLogic.com

By: Suzanne Cosgrove
Published: September 21, 2009

Upgrading to an energy-efficient heating and cooling system can save hundreds on your utility bills and earn you a tax credit worth as much as $1,500.

Replacing an aging heating and cooling system can save you money over time. According to Energy Star, a federal program that promotes energy efficiency, about half of what the average household spends on energy bills goes toward heating and cooling.

Upgrading your heating, ventilation, and air conditioning (HVAC) to energy-efficient units can cut utility costs by about 20%, or $200 annually, on average. A tax credit for heating and cooling systems can make the project more affordable.

This type of home improvement doesn’t come cheap. Prices vary widely based on where you live, unit specifications, and the condition of your home, but figure a high-efficiency furnace will start at around $3,500, including installation, estimates Corbett Lunsford, executive director of Chicago-based Green Dream Group. A standard furnace may cost $2,400. To help offset the price difference, the IRS allows a tax credit worth up to $1,500 on eligible HVAC systems put into service during 2009 or 2010. Consult a tax adviser.

Pay attention to efficiency ratings

To earn an Energy Star rating, furnaces must be more efficient than standard units, with annual fuel utilization efficiency ratings, or AFUE, of 85% for oil furnaces and 90% for gas furnaces. The Energy Star seal of approval alone isn’t enough to garner the federal tax credit. Credit-eligible (http://www.energystar.gov/index.cfm?c=tax_credits.tx_index#c3) gas furnaces (either natural gas or propane) must have AFUE ratings of 95% or greater; oil furnaces, 90%. A boiler must have an AFUE of 90%.

Heating by burning a fuel is inherently inefficient. Simply put, high-efficiency furnaces have components that are better designed to get more heat out of the combustion process, Lunsford says. You’ll need to hire an HVAC contractor to calculate the size of the equipment needed for your home. Beware bidders who take a one-size-furnace-fits-all approach. Air source heat pumps (http://energystar.custhelp.com/cgi-bin/energystar.cfg/php/enduser/std_adp.php?p_faqid=5799) and advanced main circulating fans can also qualify for the $1,500 tax credit.

Technically, a homeowner could replace either a furnace or a central air-conditioning unit and be eligible for the tax credit. Practically speaking, you probably will have to replace both for the A/C to qualify, says Enesta Jones, a spokeswoman for the U.S. Environmental Protection Agency. Most homes have split systems made up of an outdoor condenser and compressor that are connected to an indoor air handler that’s part of the furnace. Split systems must have a SEER rating of at least 16 and an EER rating of at least 13. The higher the rating, the more energy efficient the unit. A package A/C system, which houses all of its components outdoors, requires lower ratings.

HVAC’s value goes beyond savings

It typically takes about a decade’s worth of energy savings to recoup the investment in a new HVAC system, Lunsford says, though that time frame can vary greatly depending on how much fuel prices fluctuate. Less apparent in dollar terms are increasing the comfort level in your home and lowering your household’s drain on non-renewable fossil fuels. Then there’s the effect on your home’s value when it comes time to sell.

You’re going to enhance a home’s salability by moving to a more energy-efficient heating and cooling system, says Frank Lesh, president of Home Sweet Home Inspection Co. in Indian Head Park, Ill. That doesn’t mean adding a $5,000 furnace will add $5,000 to the sale price. Rather, potential buyers are less likely to push for repairs or negotiate a credit if the HVAC is in good shape. Evaluate systems older than 10 years for possible replacement.

But before you do, conduct a wider energy audit (http://www.houselogic.com/articles/conduct-your-own-energy-audit/) of your home. Lunsford, also manager of consumer education for the U.S. Green Building Council’s Chicago Chapter, says he rarely recommends replacing a furnace as the first step in making a home more energy efficient. Instead, start by sealing it against air leaks. Do-it-yourself caulking and weather-stripping help, as does adding insulation in the attic. Professional air sealing, which is more effective, can cost as much as $5,000 for a large house, he says. The payoff: Energy costs should go down, and you might be able to get by with a smaller HVAC system.

Getting tax credit for your upgrades

The federal energy tax credit is based on 30% of the cost of an eligible HVAC system. Installation charges count too. A $5,000 bill would max out the credit. You’ll need to owe more in taxes than you’re trying to claim in credits to qualify. Use IRS Form 5695. Save receipts for your records, as well as manufacturers’ certification statements. If part of a new HVAC system qualifies for the credit but another part doesn’t, ask the contractor to itemize the receipt.

The tax credit is aggregated for all qualifying energy upgrades-insulation, roofs, windows, and so on-so you can’t claim separate $1,500 credits for each project. Only improvements to your existing primary residence count. New homes and second homes are excluded.

This article provides general information about tax laws and consequences, but is not intended to be relied upon by readers as tax or legal advice applicable to particular transactions or circumstances. Readers should consult a tax professional for such advice, and are reminded that tax laws may vary by jurisdiction.

Suzanne Cosgrove, who spent nine years as an editor at the Chicago Tribune, has written for a number of business and real estate publications. She has a 90-year-old house and a long list of home-improvement projects.

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

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Tax Credits for Adding or Replacing Insulation

Article From HouseLogic.com

By: Gil Rudawsky
Published: September 09, 2009

A federal tax credit makes adding insulation an even cheaper way to improve your home’s energy efficiency and cut your heating and cooling bills.

If putting a dent in your home’s heating and cooling bills is a priority, then adding insulation needs to be at the top of your to-do list. It’s a relatively affordable home-improvement project, and the savings can be felt almost immediately. Some DIYers can even tackle the project themselves over a weekend.

For a 2,200 square foot home, adding insulation to an attic can cost from $1,000 to $2,500 including labor, depending on how much you put in and how easy it is to install. Effort and expense go up when you add insulation to exterior walls or around hard-to-reach ductwork. A federal energy tax credit worth up to $1,500 can help defray the cost.

It all comes down to R-value

Insulation is measured in R-value, the resistance to heat flow. The higher the number the better the insulating power. The U.S. Department of Energy recommends R-values (http://www1.eere.energy.gov/consumer/tips/insulation.html) between 30 and 60 for most attics. Take a peek in yours. If your insulation is level with or below the attic floor joists, then you probably need more.

There are different types of insulation, including fiberglass, cellulose, mineral wool, spray foam, foam board, and cotton batting. The most familiar is pink fiberglass roll insulation. If you’re not sure what’s best suited for your home, check with an insulation contractor. Just about all insulation qualifies for the energy tax credit (more below) as long as its primary purpose is to insulate-insulated siding, for example, doesn’t count-and it brings your home up to recommended R-value guidelines.

Energy Star (http://www.energystar.gov/index.cfm?c=home_sealing.hm_improvement_insulation_table), a joint program of the DOE and U.S. Environmental Protection Agency, suggests R-38 insulation for most attics (or about 12-15 inches, depending on the insulation type). In colder climates, R-49 may be required. The DOE’s online calculator (http://www.ornl.gov/sci/roofs%2bwalls/insulation/ins_16.html) can recommend R-values for all areas of your home’s “envelope”: attic, walls, floors, basement, and crawl spaces.

Generally, most homes built before 1980 have inadequate insulation. The easiest insulation to add is blown loose-fill insulation. You’ll probably need to hire a contractor. Since insulating an attic isn’t too complicated, you can get quotes-at least three-by phone. However, get a copy of the quote in writing before work starts, and be sure it specifies R-value. Michael Kwart, executive director of the Insulation Contractors Association of America (http://www.insulate.org/), recommends rolled insulation for do-it-yourselfers. New insulation can be added on top of existing insulation.

Savings and sustainability can add up

Depending on where you live and how much insulation you already have, adding more can trim heating and cooling costs anywhere from 10% to 50%. A homeowner in the Northeast with an uninsulated attic, for instance, can save about $600 a year by adding about 15 inches of insulation (R-38) between the rafters, according to the Energy Department. Just 6 inches can net annual savings of about $200.

The $1,500 federal tax credit (http://www.energystar.gov/index.cfm?c=tax_credits.tx_index) can be applied toward 30% of the cost of insulation installed in your primary residence during 2009 and 2010. Let’s say you spend $1,760 on enough R-38 roll fiberglass to insulate the attic of your 2,200 square foot home. That’s $40 per 50 square feet retail, a fair estimate. You’ll be able to subtract $528 (30% of $1,760) straight off the top of your tax bill, as long as you paid more in federal taxes than you’re claiming in credits. Since a typical homeowner won’t be able to use up the entire tax credit on insulation alone, the remainder can be applied to other qualifying energy-efficiency upgrades like new windows (http://www.houselogic.com/articles/tax-credits-replacing-windows-doors-and-skylights/) or roofing (http://www.houselogic.com/articles/tax-credits-replacing-your-roof/). Just keep in mind that the total credit claimed for all of these improvements can’t exceed $1,500 for the two-year period.

Save receipts, and if a contractor did the work, get a receipt that’s itemized. Labor costs, typically 25% of the total bill, according to Kwart, don’t count toward the tax credit. There’s no need to file receipts when you claim the credit on Form 5695, but the IRS could ask you to cough one up later. Also hold on to product stickers from packaging that show R-values and manufacturers’ certification statements that attest to tax-credit worthiness. Check manufacturers’ websites for a copy of the statement. If you’re building a new home, you’re out of luck; only existing homes qualify for this tax credit, which can’t be carried over into future years.

Adding insulation is just the beginning

In conjunction with adding new insulation, conduct a whole-house energy audit (http://www.houselogic.com/articles/professional-energy-audits-the-costs-and-benefits/) to find other ways to reduce power consumption and save even more on monthly bills. Caulk around drafty windows and doors, and stop gaps in siding and the foundation, says Matt Golden, president and founder of San Francisco-based Sustainable Spaces (http://www.sustainablespaces.com/). Reducing a home’s air leakage by 25% can lower annual energy costs by about $300, according to the Lawrence Berkeley National Laboratory (http://www.lbl.gov/).

This article provides general information about tax laws and consequences, but is not intended to be relied upon by readers as tax or legal advice applicable to particular transactions or circumstances. Readers should consult a tax professional for such advice, and are reminded that tax laws may vary by jurisdiction.

Gil Rudawsky has been covering business and consumer issues as a reporter and an editor for 18 years, most recently as a business editor at the Rocky Mountain News. He lives in a house built in the 1930s, and always keeps the home’s character in mind when making upgrades.

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Open Source Documents-Unbelievable Resources-Find YOUR topic of Interest

If you’ve never visited http://www.Archive.org, you are missing a wonderful site.  From this site, you will find many resources that are out of copyright and you can download and use them as you wish.  You will find all the classics and some fun things as well.  Just for fun, I have the download of a book called “Little Gardens” which is a book about setting up a garden on a city lot.  This is just one of the MANY fun things you’ll find.  You can download and watch old music, movies, and cartoons as well.  Plan to spend some time on the site should you decide to visit, as it is very cool.  Click here to download the book Little Gardens

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Sell Your Home Faster-Learn The Home Selling Secrets Of Successful Sellers

Here is a special report that outlines over 450 ideas on how to sell your home faster.  This report is just one of the many home buyer, home seller, and investor reports that I can make available to you.  Read this report and call me to arrange a time to see how I can help.  Download Now

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Why Foreclosure Is Often Preferred By The Loan Servicer Instead Of Offering A Loan Modification

Have you ever wondered why a foreclosure occurs when a better solution might have been a modification?  Would you like to read the facts and figures and see how mortgages are bundled, sold and serviced?  You will soon see it is isn’t pretty, we are in the midst of a crisis, and it is likely to get worse before it gets better.  That being said, you can probably guess why-it’s about the money.  It is a little more complex than that-the report is 60 pages-but is explains the incentive and disincentives that are at conflict within the mortgage market today.  Once you understand how all the pieces go together, you can see that something “different” needs to be done.  I am a strong free market believer, but in this case, the government needs to have a mandate and rule that is guided towards keeping people in their homes.  Left to current industry solutions, the mortgage mess will continue to play out and get worse.  If you click on the link below, you will find the free report from the National Consumer Law Center.

http://www.consumerlaw.org/issues/mortgage_servicing/content/Servicer-Report1009.pdf

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Home Buyer Tax Credit Information Update

It’s now official!! The tax credit has been extended and expanded. YOU NEED TO HURRY! You now have until the end of April 2010. The following summary of the credit is provided by the National Association Of Realtors. The following two documents cover the changes in the new law. Now get out there and buy a home!!

NAR FAQ: Homebuyer Tax Credit Changes
NAR Issue Brief: Homebuyer Tax Credit Changes

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Neighborhood Stabilization Program- Hennepin County Redevelopment Tool

We work within the parameters of this program. One of our lenders will accept this form of funding. READ more about it and see if it might work for you. We would love to help you find and finance a home within the areas that qualify.

http://www.hennepin.us/neighborhoodstabilizationprogram

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Down Payment Assistance Programs (DAP) Lender Approved In MN

On of our lenders has pre-approved various down payment assistance programs. These programs MAY have changed and MAY be out of money when you contact them. Things change all the time. With that being said, we can use these programs in conjunction with FHA, My Community and the Home Possible loan programs. We are a Minnesota mortgage broker and may be able use these programs for YOUR transaction. Call us to begin the loan process and we can work together to find you a combination of funding sources that would work for you. Click Here

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First Time Home buyer Loan Programs & Other Special MN Loan Programs

Here is a matrix that is very helpful explaining just some of the mortgage programs and their guidelines. There ARE more loan options than these as well. MN loan options are constantly coming and going-guidelines change. We don’t work with all the programs, but we do work with many of them. Call us to help you navigate through the home purchase process and select the right loan for you. Look at the Matrix of programs provided. Click Here

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10 THINGS YOU CAN DO IMMEDIATELY TO SLASH DEBT AND SPENDING

Any financial planning process begins with a change in financial behavior and expectations. The degree of change varies based on financial priorities, but in the end, it’s about adopting new habits and abandoning others.

Before you take any of the following steps, it makes sense to talk to an expert who can help you see your whole financial picture. A CERTIFIED FINANCIAL PLANNER™ professional can examine all your sources of income and expenses and find the most efficient ways to cut expenses, pay off debt and boost the money you have for saving and investing.

In the meantime, here are some ideas:

Refinance if you can: Mortgage rates are still at historically low levels. You’ll need at least 10 percent equity (20% of equity will save you the PMI insurance cost) in your home and a credit score exceeding 720 to qualify for the best rates, but start negotiating with your current lender first and see how well you do.

Track your spending for a week: Either on paper or on the computer, write down every dollar you spend in the average week (and cut off credit card use during that week). At the end of that week, start marking out non-essential items just to see how much you could live without. Start with coffee and restaurant or carryout meals and work backward from there.

Make a budget: Once you’ve established how your income covers the essential expenses you must plan for, and a few inexpensive treats that should stay in, build a budget that includes specific amounts you can allocate toward debt. Keep a running total of your spending going forward, and revisit how that budget is working on a monthly basis until you start to see some positive results, and then you can review the performance of that budget a little less frequently.

Reset your entertainment expectations: Find ways to save money with friends – cook more meals at home or rent a movie instead of going out to see one. Also, get used to checking entertainment listings for free events that interest you.

If you can do it safely, take over home and auto maintenance yourself: The do-it-yourself movement is in a new phase with the economic downturn. For any home or auto maintenance chores you may have during the year, learn as much as you can about those tasks and estimate the cost of materials and your time before doing them yourself. Previous generations made do-it-yourself a necessity. See if that option is right for you and you might save considerable money doing it. Also, for bigger jobs, pair up with friends and family and you can help each other save money.

Set a new gift policy with your adult friends and family: Does everyone on your gift list over the age of 21 really need a present for birthdays and major holidays? Suggest to family and friends to have a gift drawing, a budget limit, a moratorium on gifts, or some other alternative where you trade off gifts for quality time. Even though the holidays are a few months away, it’s not too early to think about reining in the traditional holiday overspending.

Go debit: Debit cards wearing a bankcard logo are typically welcome at most stores where credit cards are accepted. This way, you pay cash without carrying cash. If you don’t have such a card, you can get one from your bank to replace your traditional ATM card, but remember to tell them to limit your buying power on the card to only what you have in your account. And use the overdraft protection to avoid fees.

Revamp your shopping list: Give this a shot: start a central weekly shopping list on a single piece of paper and add a dollar value for each. Write everything you think you need to buy on that single sheet, from groceries to clothes for the kids. That way, you’ll see all your proposed spending in front of you, and you can get a closer look at what your true priorities are. You’ll be surprised at all the “essentials” that are not really that essential that you can cross off before you spend.

Talk to your family about spending: When you’re talking to kids about budgeting and lowering your expenses, you have to walk a fine line between discipline and fear. But setting money priorities is part of growing up, and it’s essential to discuss and agree upon them as a family.

Buy used for yourself: Make someone else’s poor luck your good luck. If you need clothing, a car or a new watch to replace the old one that’s past fixing, it might be worthwhile to buy second-hand. The best places to find these gems are on the internet on places like craigslist. Plenty of people have unloaded items in relatively good shape to bring in cash during the recent downturn. You might do very well, and if anyone asks, don’t call it used; call it “vintage.”

October 2009 — This column is produced by the Financial Planning Association, the membership organization for the financial planning community, and is provided by John Mazzara http://www.Investments.mn 952-929-2577, a local member of FPA.

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Minnesota Real Estate Newsletter Gives Access To Great Computer & Life Tips

I maintain a number of real estate sites, blogs, and newsletters. One newsletter that provides a number of computer tips to help you function better with a computer is http://www.REcyber.com/cybertips/r11627 The site is full of cyber space tricks and great places to visit. We have link to this site on the list of MN Real Estate links, but I wanted to highlight this particular newsletter because it different from what most agents provide. From this newsletter, you can also access all the back issues-from 2001 and beyond. It is really quite a useful resource-spend some time there if you have a chance.

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Make The Right Home Improvements & Increase Your MN Home Value

Are you ready to sell your Minnesota home for the highest dollar with the least amount of hassle? I have helped hundreds of MN homeowners get their home sold. Can I help you?

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Minnesota Home Seller Secrets

Are you ready to sell your Minnesota home for the highest dollar with the least amount of hassle? I have helped hundreds of MN homeowners get their home sold. Can I help you?

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Minnesota Home Buyer Secrets

First, read the guide and learn how to purchase a Minnesota home successfully. Then, call me to set up an appointment to begin the process.

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Many Cities Have Truth & Housing Ordinances

Here is a great link to see what each city requires:

http://www.mplsrealtor.com/public_tos.aspx#sp

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Publicly Funded Gap And Downpayment Assistance Programs in Minneapolis

Information is subject to change. Please contact the funding agency for current information.

Program	Description	Update	Administrator
ADDI (American Dream Downpayment Initiative)	Up to $15,000 downpayment closing cost assistance. Income asset, purchase price limits apply. Specific property standards apply also.	Limited funds are available only for City of Minneapolis projects.	GMHC/HRC-NW 612-588-3033
Audobon	Borrow up to $5,000 at 0% ($2,500 can be used for down payment assistance) to buy and/or make improvements to an owner-occupied 2-4 unit property in the Audubon Park neighborhood $5,000.	Contact funding agency for up to date information.	Center For Energy and Environment 612-335-5858
City of Lakes Community Land Trust	Assistance is available towards the purchase of a City of Lakes Community Land Trust home.	Contact funding agency for up to date information.	City of Lakes Community Land Trust 612-721-7556
Emerson Townhomes	Assistance is available as gap financing towards the purchase of a Emerson Townhome new construction home.	Contact funding agency for up to date information.	Erin Green Powderhorn Residents Group 612-721-7556
Folwell Homebuyer Assistance	$4,000 available for Downpayment or closing cost assistance for owner occupied properties in the Folwell Neighborhood.	Funds are available	GMHC/HRC-NW 612-588-3033
Harrison	$4,000 available for Downpayment or closing cost assistance for owner occupied properties in the Harrison Neighborhood.	Contact funding agency for up to date information.	Center For Energy and Environment 612-335-5858
Hawthorne Advantage	Program provides 3% of the sales price, and an additional $1,000 if you are purchasing a foreclosed property. The maximum assistance one cam qualify for is $4,000 for a property not in foreclosure or $5,000 for a property that has been foreclosed.	Contact funding agency for up to date information.	jskrenes@hawthrone community.org 612-529-6033 x204.
Home ownership Worls (HOW)	Assistance is available towards the purchase of a Minneapolis HOW home.	Contact funding agency for up to date information.	Erin Greenz Powderhorn Residents Group 612-721-7556
Humboldt Greenway	Up to $44,000 is available as gap financing towards the purchase of a Humboldt greenway new consturction home. Income limits apply.	Funds are available	GMHC/HRC-NW 612-588-3033
Jordan	Last Resort tending oppurtunity when unable to oobtain regular financing.	Contact funding agency for up to date information.	Sharon Flores Neighborhood Housing Services 612-521-3581
Lyndale	$3,000 available for Downpayment or closing cost assistance for owneroccupied properties in the lyndale Neighborhood.	Contact funding agency for up to date information.	Lyndale Neighborhood Association 612-824-9402 ext. 15
McKinley Homebuyer Assistance	$4,000 available for Downpayment or closing cost assistance for owner occupied properties in the McKinley Neighborhood.	Funds are available	GMHC/HRC-NW 612-588-3033
Minneapolis Advantage	$10,000 available for Downpayment or closing cost assistance and rehab assistance for qualifying properties in eligible neighborhoods.	The program for 2009 is not yet available for release. Names are being taken for a mailing list for when information becomes available.	GMHC/HRC-NW 612-588-3033
Minnesota Housing Homeownership Assistance Fund (HAF)	HAF Entry Cost Assistance provides up to $3,000 to help borrowers with down payment or closing cards. HAF Monthly Payment Assistance provides up to $75 per month to help pay a portion of the monthly mortgage payment in the early years of the mortgage (available only with the community Activity Set-Aside Program).	First time homebuyers interested in downpayments and closing costs assistance should contact a Minnesota Housing Participating Lender prior to siging a purchase agreement. Participating lenders can determine the level of eligibility	www.mnhousing.gov 651-296-7608
Preserving, Maintaining, and Increasing Homeownership sponsored by University District Partnership Alliance to include the neighborhoods of Cedar Riverside, South East Como, and Marcy Holmes	* A ‘option to buy’ program for current home owners that will provide up to $2,500 to people willing to give the Alliance a first option to buy their home when and if they decide to sell it. The Target areas in Marcy holmes and Southeast Como, however, will serve as the first demonstration project areas for the “option to buy” component in 2008.	Funds are available	GMHC/HRC-NE 612-378-7985
Preserving, Maintaining, and Increasing Homeownership sponsored by University District Partnership Alliance to include the neighborhoods of Cedar Riverside, South East Como, and Marcy Holmes	A homebuyer incentive program that provides up to #10,000 in the form of forgivable loans to promote owner-occupied homeownership available to new homebuyers anywhere in the District.	Funds are available	GMHC/HRC-NE 612-378-7985
Sheridan Homebuyer Assistance	$5,000 available for Downpayment or closing cost assistance for owner occupied properties in the Sheridan Neighborhood.	Funds are available	GMHC/HRC-NE 612-378-7985
Ventura Village	$5,000 available for Downpayment or closing cost assistance for owner occupied properties in the Ventura Village Neighborhood.	Funds are available	GMHC/HRC-South 612-722-7141
Webber-Camden Homebuyer Assistance	$4,000 available for Downpayment or closing cost assistance for owner occupied properties in the Webber-Camden Neighborhood.	Funds are available	GMHC/HRC-NW 612-588-3033

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USDA Rural Housing Loans – Understanding the Basics

Today you’ll find that one great option that many people in rural areas have are the USDA rural housing loans. They provide great rates and a whole lot of flexibility as well. These are loans that have been designed specifically for people who are living in rural areas around the United States, such as rural Minnesota, and they are also for those who have very little money that they are able to put down on the home that they want. There are many great options that these loans have to offer people today and if you are interested in purchasing a home in a rural area, you should definitely find out if you are in an area where the property you purchase will be eligible for one of these loans. Of course there is quite a bit to look at, so let’s take a look at the highlights that this program has to offer and the eligibility guidelines as well.

The Highlights of the Program

First of all, it’s important that you are aware of all the highlights of these USDA home loans that are available when it comes to getting a MN rural mortgage. Here are a few of the top highlights that you’ll need to understand.

• 102% of the Sales Price or Home Value – First of all, when it comes to getting a USDA loan for your home that you are purchasing, you’ll find that you can get 102% on the appraised home value or the sale price. However, you have to go with whichever one is going to be lower. A guarantee fee of 2% may also be provided with the loan as well, which allows the loan to go up to 1-2%, allowing help for buyers who don’t have the money to pay this expense out of their own pocket at the time.

• 30 Year Secure Mortgages – When it comes to these mortgages that are funded by the USDA, you’ll find that they last for 20 years. They are secure mortgages and fixed rate mortgages and the term on them is for 30 years.

• Little Cash Reserves Needed – If you are able to get rural mortgages through the USDA, you’ll need little cash reserves to help you get the home that you want. If you are a qualified buyer, you shouldn’t need to touch your own cash, which is extremely helpful to you.

• Sellers Can Help with Buyer Closing Costs – Sellers are also able to help out with the closing cost of the buyers as well with this plan. This can be very helpful to the buyer if they don’t have a lot of money to afford the closing costs on their home.

• The Eligibility Guidelines

• Now that you understand some of the highlights of the USDA rural loan program, it’s also important that you understand the eligibility guidelines as well. If you want to see if you are eligible for this type of a loan, here are a few of the guidelines that you’ll have to measure up to in order to get this type of a mortgage.

• U.S. Citizens and More – First of all, this is a loan that is designed for people who are U.S. citizens and it is also acceptable  for people who are legally admitted to the U.S. and allowed to permanently reside, as well as some qualified aliens. If you don’t meet these qualifications, then you will not be able to qualify for these programs for rural housing.

• Household Income Guidelines – There are also household income guidelines that are important to understand as well when you are considering whether one of these USDA rural housing mortgages will work for you. There are moderate income limits in the area that cannon be exceeded. However, the size of the family and any child care costs can enhance the chances of becoming qualified in some cases.

• Rural Area – Of course the home that is being purchase has to be located in a rural area as well. This can be in open country in the U.S. or it can be in areas that have less than 25,000 people in the town or area. Of course this can vary, so it is important to find out more from a loan advisor that offers these types of loans.

• Type of Residence – Last of all, the type of residence does matter when you are trying to qualify for one of these loans. You’ll find that the only types of homes that are eligible for the USDA rural loan program is going to be a home that is a primary residence. This means that vacation homes and second homes will not be eligible under this program.

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New Homebuyer Tax Credit

Back in 2008, there was a $7500 tax credit that was enacted by Congress and it was to be a great incentive for those buying homes for the very first time. It was to help out the over supply of homes out there that are for sale. For the year of 2009, there have been some changes made to this tax credit. Wondering how the new Homebuyer Tax Credit actually works? Here’s a look at the changes that have been made, who will be eligible, and a lot more important information that you need.

How this Has Changed for 2009

Wondering how everything has changed for the year of 2009 when it comes to the Homebuyer Tax Credit? Well, while the credit used to be $7500, it has now been increased by Congress to $8000. For those that purchase in 2009, there is no repayment feature on this credit, like there was back in 2008. Homes that are purchased for more than $80,000 will get then entire $8000 tax credit. Those that are lower than that will get 10% of the cost of the home. So, someone purchasing a home for $70,000 would get a tax credit of $7000. The purchase must be between January 1, 2009 and must occur before December 1st of 2009.

The People Eligible for the Credit

Many people are wondering who is going to be eligible for this new Homebuyer Tax Credit. Well, only people who are purchasing a home for the very first time are going to be eligible. People qualify as a first time home buyer if they have not owned a home for the past three years. Of course the purchase of the home has to fall in the time frame as well, in order to get this credit.

How it All Works

So, how does this tax credit work? Well, the tax credit reduces the amount of income taxes that are paid. When you fill out your income tax return, you claim these credits on there. You figure out your income items, and then your exemptions, then you figure out the amount of your total tax. Once you figure this out, then the tax credits are going to be applied to what you owe. If you owe $10,000 to the government in taxes and you have the tax credit of $8000, then you’ll only end up owing the government $2000.

A Refundable Credit

There are times when you can get a refundable credit as well. This occurs if you are able to get this tax credit for your home, but you owe less than the $8000 on your taxes. In this case you can actually get money back in a refund from the government. If you only owe $3000 to the government and you have the tax credit of $8000, then you’ll end up getting a refund check from the government for $5000.

Income Restrictions

You will find that the new Homebuyer Tax Credit does come with some income restrictions that you need to know about. The restrictions are based on the amount of money that is claimed and the filing status on the income tax returns. Those who are single can only have an income of $75,000. However, married couples who are filing jointly can have up to $150,000 to quality for this tax credit.

Determination of Income

So, how is the income determined to figure out if you meet the restrictions or not? Usually this is figured out just like the Adjusted Gross Income on the 1040 tax return. This can include salaries, interest, pension, rental income, and many other things. It is this Adjusted Gross Income that you’ll want to look out to make sure that you meet the income restrictions on the tax credit.

The Principal Residence

The tax credit is only available for those who are purchasing a principal residence. So, what exactly is a principal residence? Basically this is the home where a person ends up spending 50% or more of their time. It also may be called housing that is “owner occupied” as well. This includes condos, single family housing that is detached, townhouses, and co-ops. In some cases manufactured homes and even a few houseboats may quality under this definition as well.

Financing Restrictions

For the most part you’ll find that various types of financing are going to be acceptable when you are trying to claim this credit. There were some restrictions in 2008, but the one that was applicable then was removed in Congress. So, you don’t have to worry about financing restrictions keeping you from being able to claim this tax credit.

Do These Credits Have to Be Repaid?

While last year the tax credit eventually had to be repaid, in 2009 there is no repayment on the tax credits that are being given. This is excellent for new homeowners, since they won’t have to worry about paying back the government in the future.

How to Get the Credit

So, how do you get the new Homeowner Tax Credit? Well, there is nothing really special you need to do. Simply claim this on your 1040 tax return this year. The credit will be on a 5405 form that you will attach and you can easily get this form at the IRS website so that you can make the claim and get that tax credit.

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MN Rural Loan for Homes in Rural Minnesota – Benefits of These USDA Rural Loans

If you are considering purchasing a home in rural Minnesota, you’ll find that there are many financing options that will be available to you. However, one of the best options that you may have is a USDA rural loan. When you’re considering one of the many homes that are located in rural Minnesota, you may be wondering if there is a great way to finance your home. Well, you’ll definitely find that you can get a MN rural loan from the USDA, but of course you’ll have to meet certain qualifications to qualify. There are many benefits to choosing this type of a loan when you are trying to finance a singe family home in an area of rural Minnesota. So, here’s a look at some of these great benefits that you’ll be able to enjoy if you are able to get a USDA rural loan.

Benefit #1 – Promotes Rural Housing – First of all, one of the main benefits of the USDA rural loan program is that it helps to promote rural housing. Many people think that they may want to live in a rural area, but so many times it can be hard to find great financing. Well, this program is helping more and more people in rural areas to be able to get the type of a loan that they need so they can get in a nice home in these areas.

Benefit #2 – Excellent for First Time Buyers – Another benefit is that these loans are wonderful for first time buyers. People who are purchasing a home for the first time will find that they can easily find some great deals in more rural areas and the great USDA rural loans that are available make it even easier to be able to purchase one of these homes.

Benefit #3 – 100% + Financing - Of course the 100% financing that is offered on these mortgages by the USDA is definitely a great benefit as well. Sometimes it can be difficult to come up with the money needed for a large down payment, since so many loans out there only cover about 80% of the loan that you’ll need. However, with these loans in the rural loan program, you’ll find that you can get up to 100% financing if you need it, which can definitely be a huge help.

Benefit #4 – Refinances Apply – Although this program is great for people who are making purchases in a rural area, you’ll find that there are some refinances that apply as well. Not all refinances are going to qualify for this loan, but if you are getting a refinance in order to get a term improvement or a rate improvement on your home loan, then you may qualify to get involved in this program for those interested in Minnesota rural housing.

Benefit #5 – 30 Year Terms – The terms on these loans are 30 year terms, which is also a benefit. Many people just can’t afford the payment on a 15 year mortgage, but a 30 year mortgage is manageable for most people. Also, the 30 year mortgage comes with a fixed rate as well, which is definitely a benefit, since it means you won’t have to worry about your rate going up later and costing you a lot more money.

Benefit #6 – Buyer’s Don’t Have to Contribute – Probably one of the main benefits of going with one of these loans for rural housing is that buyer’s don’t have to make contributions. You’ll find that some FHA loans actually require that you contribute at least 3% on your home, but there is not even a minimum contribution that you have to make on the home purchase when you go with a USDA rural home loan. This is a huge benefit because it can keep you from having to dig into your savings or having to borrow more money to make up the difference in order to get the home loan that you need for your Minnesota home.

Benefit #7 – Large Loan Amount Available – There are fairly large loan amounts that are available as well. On the high side, the most that you can get in a loan from the USDA rural loan program is $417,000, which is a fairly large loan for a home. So, you have quite a bit of flexibility when you are trying to purchase a home in a Minnesota rural area.

Benefit #8 – You Won’t Need Private Mortgage Insurance - Last of all, you’ll find that another great benefit of going with one of these home loans for rural housing is that you don’t have to have Private Mortgage Insurance. Although you’ll find that you have a guarantee fee of 2% of the loan, this can be financed into the rest of the loan. If you are going with a refinance, then the guarantee cost is only going to be 0.5% instead of the 2%.

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Minnesota Reverse Mortgages – Understanding the Common Myths

Today you’ll find that reverse mortgages are quire popular and many seniors today find that this is one of the best senior housing options that are available. Although many people seem to think that they understand the way Minnesota reverse mortgages work, there are still many people who don’t totally understand how these mortgages work. There are a variety of myths out there when it comes to reverse home mortgages and it is important that people are able to get beyond the misinformation about these loans so that they understand how they work and can decide if these mortgages are a viable option for their needs. So, let’s take a look at some of the most common myths out there and the real truth about them that you need to know.

Common Myth #1 – You Don’t Have Enough Credit

Many people believe the common myth that they don’t have enough credit to get a reverse mortgage. However, the truth of the matter is that there are few qualifications that you have to go through when it comes to credit for a reverse home mortgage. When it comes to the HECM, there are only few requirements, which include not being delinquent on any federal obligations that you may have, such as a Federally Insured Student Loan , a Federally Insured SBA Loan, or a FHA loan. Even if you have had to declare a bankruptcy in the past, you will still be able to get a HECM reverse mortgage and you can qualify even if you are on a payment plan for bankruptcy if you have gone for a year of making your payment. People who are going through a foreclosure can even get the reverse mortgage that they want as well.

Common Myth #2 – The Lender Will Receive Your Home

Another very common myth that you may encounter while you are checking into reverse mortgages is the myth that the lender is going to get your home. You are the one that still owns your home, but the lender does have lien on it when you go with a Minnesota reverse mortgage. It is almost like a traditional mortgage, but instead of you paying payments on your home, you’ll find that the money that is there in the equity of your home is yours, which you can get in monthly payments, up front, or even as a line of credit. You won’t be making any monthly payments and then when you decide to sell your home, you don’t live in it any more, or you pass away, the loan will be due on the home. However, throughout the time that you have a home mortgage, you will still have the title to your home.

Common Myth #3 – Reverse Mortgages Affect Benefits From Social Security

There are some people that believe the myth that reverse mortgages affect benefits from social security, but this is another myth that is totally false. You will find that your social security cannot be affected by a reverse mortgage; however, it is important to understand that some need based programs may be affected if your reverse mortgage is handled the way that it should be. However, if you need the help from a reverse mortgage to stay in your home, you don’t have to worry about your benefits from social security or even your retirement benefits from other places being affected.

Common Myth #4 – I Have to Have My House Entirely Paid Off

The idea that you have to have your home entirely paid off is yet another myth out there that needs to be dispersed. Basically a reverse mortgage is designed to take the equity that is in your home and convert it into cash that you can have. As long as you have enough equity in your home, you may be able to get the reverse home mortgage that you want. This does not mean that your home has to be totally paid off for you to receive this benefit. In fact, there are actually many people who take out a reverse mortgage in order to pay off their mortgage so that they don’t have to worry about a payment on a monthly basis anymore.

Common Myth #5 – Use of the Money is Restricted

There are many people today that think that the money that they get from one of these reverse mortgages is going to be restricted as to the way that they can use it. This is totally false. You will find that there are no restrictions at all as to how you can use your money that you get from this mortgage, so you can use it in any way. However, it is definitely a wonderful idea to talk to a financial advisor that can help you to make the best possible financial decisions. Some people use the money that they get through this play to pay off their debt, help out their family, travel around the world, live a bit easier without having to worry about money, and even to pay medical expenses.

Common Myth #6 – Reverse Mortgages are Only for Needy Seniors

Last of all, another very common myth is that a Minnesota reverse mortgage is only for seniors that are needy. Although this is definitely a great idea for seniors that are in need, it is a great tool for anyone who owns a home when they are in their retirement years. It can help to enhance their life and today there are many people who are going with jumbo reverse mortgages that allow even people that have million dollar homes to get a reverse mortgage as well. Although FHA lending limits are below $400,000, there are other options available those who have more expensive homes as well. So, this is a wonderful option for people from all income brackets.

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MN Housing Values are Declining – Lenders Protect Themselves with Home Appraisals in Minnesota

There was a time when home values were going up; however, today this is not the case any more. You’ll find that even the value of twin cities real estate is going down, and this is causing things to change in the process of buying, selling, and refinancing a home. Today more and more lenders are beginning to work to protect themselves with home appraisals in the state of Minnesota and elsewhere around the country. This is a hard time for lenders and home owners alike, and it is no wonder that they are working to make sure that they are covered when they are lending money in any way. With MN housing values going very low, it is a great time to buy, but be aware that things may be a bit different for you when you try to get the loan for the property.

The Real Estate Market is Declining

Not only will you find that the real estate market is declining in the state of Minnesota, but this is a problem that is occurring around the entire country today. So many people are suddenly finding that their home value has gone down drastically and they are finding that selling their home at this time is hardly an option, since they will probably end up actually losing money on the sale. Because of this market that is declining, lenders are operating in ways that are different than ever before to make sure that they are not lending on properties that are worth less than the appraisal.

Appraisals Must Reflect Today’s Market

Today it is important that the appraisals that are done on homes are going to reflect today’s market. Home appraisals in Minnesota cannot be expected to reflect the home values of five years ago, although that may seem great. Lenders have to make sure that these appraisals actually reflect the current market. If they don’t, then there can be a problem later with the loan on the home. Lenders don’t want to end up actually lending out more money than the home is worth in today’s market, so any appraisal that is done should be sure to reflect the actual home value of the home today.

Lenders Start Going with In-House Appraisals to Protect Themselves

Because of all the changes in the market and the many foreclosures that have been occurring where lenders are losing huge amounts of money, many lenders are starting to go with in-house appraisals to help protect themselves. Too much money has been lost because they end up foreclosing on a home that is no longer even worth the amount of money that is owed on the home, which really is bad for lenders. So, they are now making sure that quality appraisals are done before they lend. While they may have taken the word of the appraisal done by a real estate company, now they often are going with their own home appraisals in Minnesota to make sure that they don’t lose on their properties.

Comparative Market Analysis

Many companies are also turning to comparative market analysis as well, which is very important when they are deciding on the home value of a specific home in a specific area. Basically a comparative market analysis actually helps to establish a price of value of the home by taking a look at various properties that are also in the same area. While lenders are still having appraisals done on homes as well, they are also using the comparative market analysis to help make the decisions on what the homes are really worth as well.

How This Affects You

So, wondering how all of this affects you. Well, you’ll find that just getting your own appraisal if you are going to purchase a home is not going to cut it anymore. You can expect lender to go ahead and do one of their own as well. Also, if you are trying to sell a home, this can affect you as well. If you are trying to get what the home was worth a few years ago out of the home, then you’ll have a problem. There is no way that these lenders are going to finance that amount of money. They will only finance the amount of money that the appraisal is today. So, this can definitely cause some interesting problems and challenges for those who are trying to work on selling a home in this market that is having a hard time lately.

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The Homeowner Affordability and Stability Plan

In the past few months, we have definitely seen the economy go down hill. The housing market has almost crashed and many people are looking for relief. With so many people having difficulty making home payments, the list of foreclosures is large and going up by the thousands every single day. Well, in order to try to help people dealing with this problem the Homeowner Affordability and Stability Plan has been created and will soon be started up. Of course many people are not even aware of all that this plan has to offer. So, here is a closer look at the plan, why it has been created, the components of the plan, how to know if you are eligible, and when it all is going to get started.

Why This Plan Has Been Created

So, you may be wondering why the Homeowner Affordability and Stability Plan has been created by the Obama Administration. Well, the plan has been developed to help the millions of families that will probably be facing foreclosure in the near future as well as people who are working hard to keep current on their mortgage. We are dealing with a real estate crisis as well as an economic crisis. In order to keep problems from going even lower as the foreclosures mount up, the administration hopes that this plan will help to stabilize the market and eventually start things back on an upward trend. The plan is supposed to help millions of people keep current on mortgage payments and to help prevent foreclosures from happening as well. It will work to help the housing market recover while helping workers pay on their mortgages to prevent a further crisis.

This plan comes with several different components. Here is a look at the three main components that make up this plan, how they work, and the goals of each component as well.

Component #1 – Offering Refinancing for Homeowners that are Responsible

The first component of the Homeowner Affordability and Stability Plan is to offer refinancing to homeowners that have proven to be responsible. This way they don’t continue to suffer because of falling home prices. Some people are having great difficulties dealing with their mortgage payments, since now their homes are worth far less than what they owe on their mortgage. This component of this plan will work to help those people refinance for lower rates and payments so they can continue to afford paying on their home without having to face foreclosure in the future.

Component #2 – Homeowner Stability Initiative ($75 Billion)

The second component of the Homeowner Affordability and Stability Plan is a homeowner stability initiative to the tune of $75 billion dollars. This will include a loan modification plan that will reach out to lenders to help them reduce payments and will also provide incentives to borrowers as well. This is expected to be helpful to 3-4 million people who own homes. Clear guidelines are laid out within the plan for the loan modifications that will take place as well. During bankruptcy people may be able to modify their home mortgages as well. It should also help out FHA loan programs and should provide more hope to those that own their own homes today.

Component #3 – Strengthening Freddie Mac and Fannie Mae

The third component of this plan is going to help strengthen the confidence in Freddie Mac and Fannie Mae, which should help to keep mortgage rates low. This component has several different steps to it. It will provide for responsible homeowners low cost refinancing if they are dealing with problems due to home prices that are falling. This will help them to reduce the payments that they are paying each month so they are more affordable. There is also money to help prevent foreclosures as well.

Who This Program Will Reach Out To

There are many people that this plan is attempting to reach out to. It is focusing on those who own homes and who are at risk of ending up in foreclosure. It provides loan modification to these people. It also reaches out to those who have not been missing their payments. For families that have a lot of debt, there are special provisions in this plan for them as long as they going into debt counseling that is HUD certified. It should provide protection to tax payers, will provide counseling as well as outreach, and will limit foreclosures in the future as well.

How to Know if You are Eligible

So, now that you know a bit more about the Homeowner Affordability and Stability plan, you may be wondering how you can know whether or not you are eligible for this plan. Usually you’ll need to have enough income to make a new payment and you’ll need to have a fairly good payment history as well. Of course not all of the eligibility details are out yet, and they will be announced when the program gets started.

When the Program Starts (March 4th)

Wondering when this program will get started so you can start benefiting? Well, you’ll find that the program is going to get started on March 4th, when you’ll be able to find out a whole lot more about it.

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Minnesota First Time Buyers Financing Options

Minnesota First time buyers financing options include- FHA, VA, conventional, special down payment assistance and bond funding

First time homebuyers in Minnesota may feel a little scared about whether or not they will be able to obtain the loan they need in order to secure the home of their dreams. Often times first time homebuyers are young couples who do not yet have a lot of work or credit history to look back upon. This makes them a risk according to many lenders, which can make it somewhat difficult for people to find the loans that they need to get the home they have been eyeing up for some time now. Since there are so many roadblocks up against first time homebuyers, one may think that they just do not stand a chance.

Luckily though there are a lot of program out there designed specifically with the first time homebuyers in mind. Such programs would include that of FHA, VA, special down payment assistance, bond funding, and conventional loans. These finance options are out there for the taking but you will want to take a special look at each one of them in order to make sure that you are going with the one that is right for you. Minnesota housing finance is something that scares a lot of people who have gone through the process before. As long as you are working with skilled professionals there should be no reason to be worried.

Those you are working with will know that you are a Minnesota first time homebuyer. You are looking at a vast majority of Twin cities homes and it is important to make sure that you are getting the best for your money. That is why some of the programs require the Minnesota home to pass their own criteria of home inspection qualifications. This is to protect the best interest of not just the lender but the customer as well. Since first time home buyers are new to the whole thing, they may need that little bit of extra guidance to make sure that everything goes smooth and that they are not ripped off.

The Minnesota housing finance that is the least popular for those who are first time homebuyers is that of the conventional loan. There are a lot of hoops to jump through and a lot of qualifications a buyer must meet in order to make the cut. Although conventional loans can offer great rates, that is not the only type of loan out there that can give you incredible rates. Since FHA and VA loans are designed to give people a break, they will generally offer incredible interest rates as this will help to make sure that the new buyers will have very little problems making their mortgage payments. In some cases, the interest rates given through an FHA or VA loan is better then what could be offered through a conventional loan.

If you are ready to buy a home but feel as though you do not have a lot of money for a down payment you could find help with that. Some people may not have any money at all for a down payment but that does not mean that there is not assistance for that out there. The government wants people to be homeowners and that is probably a big part of the reason as to why there are so many programs out there is help give down payment money. Generally, the down payment money is given from the program or the sellers of the property. It raises the principal balance by that amount of money. All it means is that you are paying the down payment money throughout the course of the loan instead of upfront, as this is the easiest way to look at it.

Bond money can also be an option if you qualify. There is a lot of money set aside out there for people who need help with down payment money. The key though is to make sure that you are really looking over all of your options in order to make sure that you are making the right decision for you and your family. There is nothing wrong with wanting to come up with the down payment money on your own, but if there is assistance out there for a Minnesota first time homebuyer then you should look into it. You could always use the money you have set aside for moving expenses or to do some minor repairs to the home once it is yours.

Make sure that you contact a realtor as soon as possible in order to review all of your options. As long as you are going with an experienced realtor, he or she should have no problem walking you through the process and providing you with all of the money you would need to check into a FHA or VA loan. Even if you qualify for the first one you look into, make sure that you are exploring all of your options. By not doing so, you could very well find yourself wasting hundreds, or even thousands, of dollars that you could have otherwise saved and put towards something else.

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