home financing

MN contract for deed myths

Busting the Most Common Contract for Deed Myths

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MN contract for deed can be an excellent way for those with less than perfect credit to finance home purchases. Particularly in Minnesota, contract for deed has been a preferred home financing method for years as many people have credit blips and issues that allow banks to quickly turn them down. Contract for deed, however, is sometimes the victim of misconceptions and broad statements that just do not apply.

It’s Not Rent-To-Own

mn contract for deed

Rent-to-own is another alternative financing method, but it can be an issue for buyers. In a Minnesota rent-to-own scenario, a property owner will offer to rent to a tenant. The property owner then agrees to put a portion of the rent aside that the tenant can put toward the eventual purchase of the home. This is not necessarily a down payment but could be a credit. For example, a property owner could offer to place $200 of the tenant’s $1500 monthly rent payment toward the purchase of the home. If the tenant made 36 on-time payments, the seller would then give the tenant credit for $7200 toward the purchase of the home. The problems with this are:

  • The money doesn’t really exist after it has been paid to the landlord.
  • It only is booked as a possible credit.
  • If a purchase price hasn’t been predetermined, the landlord could just raise the price of the home by the amount of the credit.
  • If the tenant is late on only one payment, all credits can be forfeited.

Minnesota contract for deed doesn’t work like this as we will explain below.

MN Contract for Deed is Not Predatory

How Rent to Own Works

In other states, rent-to-own and similar contracts for alternative financing are called executory contracts and are not liked by state courts.  The reason for this is that unscrupulous property owners would find un-creditworthy victims, receive a substantial down payment, sign them to a contract that requires big monthly payments, and add clauses that forfeit the down payment if even one monthly payment is a day late. Then the property owners would evict the tenant and start the process again.

MN contract deed is different, again, as we will explain below.

It’s Not Only for Those with Bad Credit

Business owners know that even with good credit it may be difficult to purchase a home. Take the example of a restaurant owner that has paid every bill on time, but he or she may have high student loan balances, high business credit balances, too many business credit cards, multiple vehicle payments and other debt. Throw in a recent divorce, and that busy successful entrepreneur may have issues getting financing.

This is a case where MN contract for deed could help.

Contract for Deed Credit

How MN Contract for Deed Works

  • You find a Realtor
  • You find a home.
  • You bring the deal to C4D.
  • We buy the home.
  • We sell it to you using a contract for deed.
  • You make all of your payments.
  • You get the deed, and you are a homeowner!

If you have any questions about us or our MN contract for deed process, be sure to contact us. We make deals where others cannot, and we have an impressive list of homeowners that would still be tenants if they had not come to us.

Repair Your Credit Score Today!

5 Ways to Repair Your Credit After Foreclosure

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Sometimes things get really difficult, and you think you’ll NEVER be able to repair your credit.

You may have lost your job, faced massive medical expenses, your business failed, or maybe you just bought a more expensive house than you could handle. While you tried to avoid foreclosure, you woke up one day and realized that it was inevitable.

Repair Your Credit

If you lived in a non-judicial foreclosure state like Minnesota, the process probably happened quicker than it would have had you lived in neighboring Wisconsin where foreclosures sometimes slowly wind their way through the court system. Nevertheless, it’s over now, and you’re afraid to look at your credit score. Times might be tough, but you NEED to understand how to repair your credit.

The Foreclosure Effect

Foreclosure

The bad news is that your credit score can drop as much as 150 points or more once the foreclosure process is completed, but the good news is that while a foreclosure will stay on your credit report for up to seven years, you can watch your credit score rise if you do the following:

Repair Your Credit By Considering Bankruptcy

If foreclosure is merely one symptom of your financial distress, and if you still have lots of debt that you are unable to pay, consider wiping the slate clean with a Chapter 7 bankruptcy. If your credit score is going to take the foreclosure hit, it may be prudent to clear as much debt as possible through bankruptcy and truly start fresh.

Remember, however, that certain debts like student loans and taxes are not normally dischargeable in bankruptcy.

Don’t Be Late

Late payments will only set you back again, so make all payments on time. Do a thorough budget analysis and do everything possible to pay all bills when they are due. This may mean getting a second job or going out to eat less often but do whatever it takes to never be late with a payment again.

Rebuild and Repair Your Credit Score

Credit can be rebuilt; it may be challenge, but it can be done. Newly bankrupt individuals often quickly receive high interest and high monthly fee credit card offers. Some of these are almost predatory as you may be offered a $300 line of credit minus a one-time fee of $75. Still, if you make on-time payments, even these companies will report favorably to the credit bureaus.

Repair Your Credit Score

Friends and Family Can Help

If you need money, see if you can borrow it from friends and family. They don’t report to credit bureaus, and they may offer you very generous repayment terms.

Go Back to School

Federal student loans are provided without checking your credit score. Didn’t hear us the first time? You can get a federal student loan with bad credit that includes bankruptcy and/or foreclosure. There are caveats of course — and you still want to work hard to repair your credit score. If you have defaulted federal student loans, or if your bankruptcy is active, you may have issues.

If your only problem is bad credit, late payments and even a foreclosure in progress, you can still get a loan. At a good state non-profit university, you can take six credits—some of them online—get a federal student loan, have the loan pay your tuition, and there still can be money left over for you to live on. Yes, you have to pay back student loans, but not until you are finished with school.

Buying a Home After Foreclosure

Steps to improve credit score

Banks want squeaky-clean credit and no missed payments of any kind for 36 months before they will even consider you for a home mortgage. We know it’s tough to go for three years without a financial blip, but this is where the experts at C4D can help, while you work to repair your credit score.

We use MN contract for deed to get you into a home that you will own free and clear after you make all of your payments. Because we look at people—not only credit reports—and because we have developed superior banking relationships over the years, we can help you buy a home after a financial crisis. Bankruptcy and foreclosure should not be considered financial death. You will have been injured, but you can recover. Check out our site to see how we can help you like we have helped countless others.

Costly First Time Homebuyer Mistakes

Avoid These 4 First Time Homebuyer Mistakes

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You’re ready to make the move from a rental unit to your new home. You’ve checked and updated your credit, and you are ready to look for properties. You have saved a nice-sized down payment and you are set to pull the trigger. Be careful, however, that you don’t make one of these crucial first time homebuyer mistakes.

First Time Homebuyer Mistakes #1: The Wrong Agent

First Time Homebuyer Mistakes

Let’s be clear. You don’t need to be represented by a real estate agent at any time during the purchase process to avoid making a first time homebuyer mistake, but many buyers like to contract with an agent because:

  • It’s free! The buyer pays the commission.
  • You have instant access to MLS listed properties.
  • The agent does the negotiating.
  • You never have to meet the owner except maybe at the closing.
  • The buyer can be a great information resource.

Homebuyer Mistakes

If all that’s true, what could be the problem? Well, the wrong agent could slow down the buying process because:

  • They are too busy.
  • They don’t have sufficient market knowledge in your area.
  • They are inexperienced.
  • They are not ethical.

Therefore, make sure you have carefully vetted your agent, and that you are comfortable that they are reputable, knowledgeable, ethical, and are not overloaded with clients. Also, at the initial meeting, understand agent contact rules. While you may expect instant answers to your questions, real estate agents and Realtors do have other clients, and you may have to be patient at times.

First Time Homebuyer Mistakes #2: Wrong Lender

Many entities make mortgages. Banks, credit unions, private lenders and even Internet banks regularly offer mortgages. This is one area where you need to do your homework and understand the difference between 15 and 30 year mortgages, for example, and all of the implications thereof. Mortgage rates can vary, so don’t take the first deal that’s offered to you. Later, we’ll talk a little about MN contract for deed financing.

First Time Buyer Errors

First Time Homebuyer Mistakes #3: Falling in Love with a Property Too Soon

Just because you have always wanted a great lawn and the first property you see has impeccable landscaping doesn’t mean you have to buy it at any price. Sure, it might be great to live there, but you are not living there now, and other homes are available. Don’t get caught in bidding wars (here’s how to win a bidding war, should you encounter one); see lots of houses before you make a decision. This isn’t HGTV where you get three options and that’s it.

First Time Homebuyer Mistakes #4: Wrong Neighborhood

If you are from out of the area—especially if you are from a different state—it’s extremely important to gain total knowledge of the municipality before you make a move. A first time homebuyer mistake, at this point, would be terribly expensive.

There are many stories of first-time out-of-state buyers that purchased a home in what they thought was a desirable location, only to find out six months later that they would have liked to have located somewhere else. Viewing many properties on the same day in an unfamiliar city can just be a blur. Sometimes renting a home in a new city before you buy is a good option since that will give you time to figure out exactly where you want to live.

First Time Homebuyer Mistakes

It’s all about good Realtors and agents, proper financing, not making rash decisions, and of course choosing the best location. Sometimes everything works out except the financing, and if that’s the case, don’t give up, because we’ve helped many persons that, for a number of reasons, just can’t qualify for a mortgage. We use MN contract for deed, and we invite you to visit our site to learn how we make home ownership a reality when others have said no.

Your Guide To Buying A Foreclosed Home

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Buying a foreclosed home became extremely popular about a decade ago. Why? Well, the problems that began in 2009 led to a meltdown that created scores of opportunities for both investors and previously foreclosed homeowners that wondered if they’d ever purchase a home again after foreclosure. 

Over 5 million homes were foreclosed since then, and many investors have looked upon these as opportunities.

Since HGTV shows like Flip or Flop have become popular, many people think they are familiar with what a foreclosure is, and they think they can make big money by picking off great property values before someone else does. We advise you to be careful.

What is Buying a Foreclosed Home?

When you are looking at a home that is listed as a foreclosure, you need to understand what that means. Is this home in foreclosure, is the seller trying to avoid foreclosure, is someone offering a short sale, or is the property genuinely bank owned?

Buying a Foreclosed Home

How Does Buying A Foreclosed Home Work?

Usually, after a homeowner crosses the 90 day past due mark, the lender will begin the foreclosure process. This simply means that the lender begins the legal work necessary to take back the collateral—the home—that the homeowner placed as security with the lender. Unfortunately for Minnesota debtors, MN foreclosures are many times non-judicial; this means that properties can be taken back outside of the court system. Foreclosures can take a lot longer in judicial foreclosure states like Wisconsin. Our friends at alllaw.com tell us this happens as follows in Minnesota:

Notice of the Foreclosure

In Minnesota, a foreclosing party must give the defaulting borrower the following notices.

Notice of the default. In most cases, the foreclosing party must mail the borrower a written notice of any default before officially starting a foreclosure. The notice must provide the borrower with 30 days to cure the default.

Notice of availability of foreclosure prevention counseling. Along with the notice of default, the foreclosing party must also provide notice that foreclosure prevention counseling services are available and that the homeowner’s contact information will be sent to an approved foreclosure prevention agency.

Notice of sale. To start the foreclosure process, the foreclosing party must first file a notice of the pendency of the foreclosure with the county recorder’s office. After filing the notice of pendency, it must publish a notice of sale for six weeks before the sale. The foreclosing party must also serve a notice of sale to the occupant of the home four weeks prior to the sale.

Foreclosure advice to owners and notice of redemption rights. Along with the notice of sale, the foreclosing party must provide a foreclosure advice notice, which provides information about how to get help, as well as a notice of redemption rights providing information about what happens after the foreclosure sale.

The foreclosure advice notice must also be provided with each subsequent written communication mailed to the borrower. A foreclosing party is deemed to have complied with these requirements if it sends the foreclosure advice notice at least once every 60 days up to the date of the foreclosure sale.

In Foreclosure

So if you are looking at buying a foreclosed home, the actual home shown as “in foreclosure” is probably somewhere in the process described above. If you are interested in a property while it is in foreclosure you have to deal with all parties including the homeowners and all lenders. You can’t make a deal with only one of the parties involved.

Short Sale Forclosure

Short Sale

Sometimes the homeowner gets the lender to agree to a short sale. This means that the lender may agree to take less than what is owed on the property in order to streamline the process and allow the homeowner to avoid a foreclosure appearing on their credit report. These deals can take quite a while to engineer, and again, all parties need to agree.

Bank Owned

When the foreclosure process has been completed and the collateral has been returned to the lender, the home is termed bank-owned. At this point you only need to deal with the bank or its agents, since the bank is the legal property owner.

Forclosed Home

Strategies

Foreclosures, like storage shed content sales, used to be a more quiet and shadowy business. This isn’t the case any longer, however, as foreclosed properties are commonly inundated with multiple offers as many people want to cash in on the misfortunes of others. The best way to attempt to buy a Minnesota foreclosure is with cash.

Once you have located the property you are interested in, do your diligence and find out who actually owns it. Then, if you have the power of a cash offer, you may be able to make a quick deal. Remember, with foreclosure deals we recommend that you get qualified legal help, and please be advised that this article does not constitute legal advice.

If you have any additional questions, please feel free to contact us here.

Second Mortgage

A Second Mortgage: Should You Take It Out?

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We know from the economic meltdown that began in 2008 that using your house as an ATM may not be the best idea. A fat line of credit that can be accessed with a debit card or even checks can be quite tempting, but that doesn’t mean that you should automatically think about taking out a second mortgage loan to tap your equity—unless you have a good reason.

Taking Out a Second Mortgage: Not So Good Reasons

You should only borrow money if you need it. That may sound simple, but in some countries, people borrow money simply because they can. Even in the U.S. in the early 2000s, many people based their “wealth” upon the amount of money they could borrow. Some people with only $5000 in savings but with $100,000 of available credit thought they were well off because they had the ability to raise a substantial sum. Therefore, they acted upon any chance to borrow money and loaded up on credit lines. If you are borrowing money only because you can, that’s not a good reason.

Taking Out A Second Mortgage

Taking Out a Second Mortgage: Finances are Tight

This happens for a reason. If you spend more than you make, you will be cash-flow negative, and that will cause you to borrow. If you have amassed considerable credit card debt, it may be very tempting to take out a second mortgage at a lower combined interest rate and pay off those cards. Seven or eight percent is a lot better than 27.9 percent, but if you don’t cut up your cards after you have paid them off, you may not be able to resist the temptation to max them out again.

Finance are Tight

You Just Need Some Breathing Room

Breathing room is great, but if the forces that are suffocating you are not dealt with, you won’t make any progress. If your $800 monthly utility bill is killing you, turn down heat, turn up the A/C, quit watering your lawn or turn out the lights. If you don’t act, you’ll soon see another $800 energy bill, and you’ll have to figure out how to pay that. Borrowing against your home for monthly expenses that you can’t reduce is not a good idea. Instead of this, start looking for the best side hustles that allow for some extra income!

Economic Stimulus

Some Better Reasons for Taking Out a Second Mortgage

There are, however, some good reasons to borrow against your home:

  • You’re starting a business.
  • You want to go back to school and can’t get reasonable student aid or loans.
  • You want to help a family member.
  • You want to start a remodeling project that will increase your home’s value.
  • You want to assist your children with some expenses.
  • You found a great investment opportunity.

Like any other loan, make sure you shop around to get the best terms.

The Contract for Deed Crew

While we don’t do second mortgage loans, we at C4D can assist you with the purchase of your home. We are more flexible and understanding than a lot of banks, and we are experts at using the MN contract for deed as a path for true home ownership. If you have any questions, visit our site. We are here to help!

Rent vs Own

Rent vs. Own: The Actual Monetary Difference

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

Let’s Take Autos as an Example

Rent vs. Own

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

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

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

But What About Homes?

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

Check Out the Residential Difference

Rent vs. Own Homebuying

Image via Trulia

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

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

Rent vs. Own: Compounding Benefits

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

The Contract for Deed Crew Can Help

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

Homebuying After Divorce

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

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

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

Buying A House After Divorce

Why Is That a Problem?

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

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

Co-Sign Home Loan

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

Alimony and Child Support

Child Support

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

Have You Ever Been Sued?

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

Divorce Decree

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

Joint Accounts

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

Joint Bank Account

The Answer: Buying A House After Divorce

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

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

Contact us today to find out the details!

Buying A House Without A Realtor Is A Bad Idea

Buying A House Without A Realtor: Terrible Idea?

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Buying a house without a realtor. For some reason, this just doesn’t sound like one of your best ideas yet.

You may be the kind of person that wants to handle everything without assistance from brokers or agents. When you make a major purchase you always want to talk to the supervisor or store owner, and you may not like dealing with middlemen. When you are looking to buy a MN home, however, you really need to consider the use of a qualified Realtor, and here are some reasons why:

You May Have a Harder Time Finding Properties

Realtors have MLS access but you can’t just login online to view it. While Trulia, Redfin, and similar sites will eventually pick up MLS listings, there is nothing like going to the source and being able to view up-to-the-minute listed properties that are for sale. Your local real estate agent may also have a network where he or she is made quickly aware of any “coming soon” properties, and your Realtor can find out sooner if a house under contract may again become available because of failed financing or other issues. In addition, other Realtors may be more apt to divulge information to another Realtor than to you.

Buying A House and Knowing The Price

Area Knowledge

Especially if you are new to a city, you need a Realtor’s intrinsic neighborhood knowledge. Many of us know someone that recently moved to a city and chose a certain neighborhood only to realize a year later that they would have liked to have located in a different part of town.  A good Realtor can help guide you to the neighborhoods that match your lifestyle.

The Offer (When Buying A House Without A Realtor)

Do you offer 97 percent of the purchase price? 95 percent? Are you in a bidding war? Should you offer more than the asking price? Should you ask for paid closing costs? What does the inspection period mean? Do you realize, that in some states, you can lose your earnest money deposit even if your financing is not approved? Realtors are experts, and will guide you through the offer process. Take a look a standard offer to purchase form, and ask yourself if you really know how to fill in all of the blanks properly. A Realtor will have had lots of experience with contingencies, and will help you understand all fees involved in a purchase contract.

Buying A House Without A Realtor

Be Realistic About the Deal

While you may think it’s a good idea to haggle about the final $1000 of a $350,000 deal, your Realtor may tell you otherwise. Realtors have a good sense of what will be accepted and more, importantly, what may aggravate a seller. When you deal with sellers without a Realtor, you may be working blind.

Financing Issues When Buying Without A Realtor

If you have MN bad credit, or are having trouble buying a home because of massive student loan debt, a good Realtor can steer you to non-traditional financing sources. We at C4D are experts in MN contract for deed sales, and many Realtors come to us with deals that have been difficult to finance elsewhere. While we all know that traditional mortgage financing is preferable, many times we can help get you into your dream home when others have not been successful.

Actionable Tips For First Time Home Buyers in 2018

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

Tips for First Time Home Buyers: Your Realtor

First Time Homebuyer Broker

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

Next Tip: Clean Up Your Credit History

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

Tip #3: Pay Down Those Cards

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

Tip #4: Work on Those Student Loans

As Student Loan Hero tells us:

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

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

Tips for First Time Home Buyers - Student Loans

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

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

Tip #6: Be Realistic and Discerning

Our friends at U.S. News tell us:

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

Tip #7: Be Serious and Ready to Go

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

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

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

Tip #9: Talk to the Neighbors

Homebuying Neighbors

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

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

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

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

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

Buying a House After Foreclosure

Buying After Foreclosure: Your Next Steps

1000 500 Sam Radbil

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

Distressed Home Sales

What Is Foreclosure?

Our friends at Investopedia define foreclosure like this:

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

Here’s why it might have happened to you.

Buying A House After Foreclosure: The Reasons

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

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

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

Credit Repair

Credit Repair for Foreclosure

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

Everything Has Its Price

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

Buying A House After Foreclosure

Get A Card

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

Time Is Your Friend

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

Contract for Deed Financing

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

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

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