701 1st Street NW, New Prague, MN 56071 (MLS # 4148112)

Open and spacious end unit town home with 3 BR/s and 3 baths! Large, eat-in kitchen with island, dining room, two large living spaces, office and over sized garage. Move in ready. Come take a look!

Property Type(s): Residential, (TH) Side x Side

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Listing information deemed reliable but not guaranteed. Read full disclaimer.

Listed with RE/MAX Advantage Plus

(view all details for MLS #4148112)

26621 Vergus Avenue, Cedar Lake Twp, MN 56071 (MLS # 4149532)

Updated home in park-like setting; this energy efficient home has large rooms, remodeled kitchen with new cabinetry and granite. Pole building has heated horse area with two stalls. Lots of wildlife, hunt, bring the horses and enjoy the privacy!

Property Type(s): Residential, (SF) One Story

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Listing information deemed reliable but not guaranteed. Read full disclaimer.

Listed with RE/MAX Advantage Plus

(view all details for MLS #4149532)

As of April 9, 2012, the upfront insurance premium charged on FHA-insured mortgages for home purchases will increase to 1.75 percent, up from 1 percent currently. In addition, annual FHA mortgage insurance premiums will rise by one-tenth of a percentage point.

The increases are designed to bolster the FHA’s reserves, which have fallen below the minimum established by law as a result of the housing crash. It will be the fourth FHA fee increase in the last three years and is expected to bolster the fund by more than $1 billion through 2013, according to the Department of Housing and Urban Development (HUD).

The fee increases will raise the cost of a $200,000 FHA mortgage by about $24 a month, assuming the borrower includes the upfront charge in the amount financed through a 30-year mortgage.

Streamline refinance exempted; fees going down

Certain borrowers who refinance current FHA mortgages are getting a break, though. The upfront fee for on an FHA Streamline Refinance is staying at 1 percent for now, and will drop to 0.01 percent as of June 11 for borrowers who obtained their current mortgage before May 31, 2009. The annual insurance fee on such refinances will remain at 0.55 percent.

A streamline refinance is a more or less automatic refinance for borrowers who currently have FHA mortgages. The main criteria is that they must be current on their mortgage payments and realize a tangible benefit from refinancing – such as a lower interest rate.

Fee increase on jumbo loans pending

Other fee changes are coming as well. The annual insurance fees on jumbo mortgages above $625,500 will increase by another quarter of a percentage point as of June 11, in addition to the upfront charge of 1.75 percent.

The annual insurance fee varies depending on the length of the loan and the size of the down payment. For 30-year mortgages with less than 5 percent down the annual fee will increase to 1.25 percent; for larger down payments, the rate will be 1.20 percent.

Some 15-year loans exempt

On 15-year fixed-rate mortgages, the annual fee will be 0.60 percent for loanswith less than 10 percent down, and 0.35 percent for loans with down payments of 10 percent to 22 percent. The additional 0.25 percent increase for jumbo mortgages will be added June 11.

The annual insurance fees are waived on 15-year FHA mortgages with loan-to-value ratios below 78 percent, equal to a down payment of great than 22 percent.

The FHA will continue to allow down payments of as little as 3.5 percent for most borrowers.

Sellers of condominiums and townhomes are required by Minnesota law to provide to buyers a resale disclosure certificate.  However, many lenders who are selling property they acquired from foreclosure believe they are exempt from obligations that exist under state statutes.  In many cases, these lenders are from out-of-state and do not believe specific state disclosure requirements apply to them.  This has become even more pronounced with the recent explosion of properties owned by lenders and HUD.  Despite the arguments by the lender, the obligations under the condominium act apply equally to them.  Lenders and HUD are not exempt from providing purchasers of homes in common interest communities the resale disclosure certificate. 

 In situations of a resale of a home in a CIC (common interest community) which would include most condominiums and townhomes, the owner is required to make a request on the community association or its property management company for the resale disclosure certificate, and the owner is required to provide the resale disclosure certificate to the buyer prior to closing.  The contents of the resale disclosure certificate are found in the Minnesota Common Interest Ownership Act (MCIOA).  The association may charge a “reasonable fee” for preparing the certificate and providing any association documents related to that disclosure.  Those association documents include the Declaration, the Articles of Incorporation, the By-Laws, the Rules and Regulations (if any), any Amendments to those documents, and certain financial documents of the association. 

 There is not an exemption under the statute for a lender or HUD to this requirement.  A frequent argument by lender is they are selling the property “as is”, and, therefore, are not making a disclosure.  However, an “as is” sale is not exempt to the obligation to provide a resale disclosure certificate.   

The lender’s refusal to provide the certificate becomes a problem for the listing agent.  If the owner/lender is refusing to provide or pay for the preparation of a resale disclosure certificate, the listing agent needs to make sure that all potential buyers and their agents are aware of the fact that a certificate will not be forthcoming.  Buyer’s agents involved in these transactions, if not having received a resale disclosure certificate, should immediately inquire of the listing agent.  To the extent that the certificate is not provided, the buyer’s agent needs to make clear to the buyer that they will not be receiving a certificate. 

Potential buyers may not know what a resale disclosure certificate is and all the information that is contained in that form.  It is critical that the agent inform the buyer of what is in the form and what information they will not be getting.  If the buyer still wishes to proceed forward, they must understand they are doing so without critical information which would assist them in making decisions to purchase the property.  This information may include information about assessments owed on the property, litigation that the association may be a party to, defects that may exist with the property, and rental or pet restrictions.  These are important facts that the buyer should know prior to making decisions to purchase.

The statute does provide that the purchaser may rescind the transaction to the extent that they do not receive the resale disclosure certificate and the association documents before closing.  However, once the transaction closes, the purchaser will not be able to seek rescission because of the absence of the certificate.  However, to the extent that the buyer was unaware of the existence of the certificate, they are not without remedy.  They can pursue the real estate agents and the seller for not providing the certificate to the extent that the information, if included in the certificate, would have advised the buyer of potential issues with the association which are leading to monetary damages to this new buyer.  In other words, if the buyer closes and discovers that there is a large assessment or that he cannot use the unit in the manner in which he intended, he may have suffered damage for which he can seek recovery.  To the extent that the certificate was not provided by the seller and neither the listing agent nor buyer’s agent advised the buyer of the absence of this form, that buyer may have a cause of action against the real estate agents for negligence and potentially against the seller for violation of the statute and non-disclosure of material fact.

 Therefore, it is critical for real estate agents, whether they are the listing agent or the buyer’s agent, to emphasize the need for the resale disclosure certificate even with a reluctant seller.  These documents are important to the buyer but they also provide a certain level of protection to the real estate agents because they are an additional disclosure of material facts which could affect the buyer’s use or enjoyment of the property.

David McGee’s practice is based in the litigation section at Thomsen & Nybeck, P.A.  Dave brings his 20 plus years of experience representing Community Associations in construction defects and insurance disputes.  Dave has recovered millions for Associations in disputes with developers, contractors and insurance companies, and heads up the firm’s “Property Insurance Claims” Group.  Dave has been named a “Top Lawyer” by Minnesota Law & Politics and Minneapolis/St. Paul Magazine for a number of years.  Dave has represented clients in numerous appellate cases including Chapman Place Ass’n, Inc. v. Prokasky, 507 N.W.2d 858 (Minn. Ct. App. 1993); Ly v. Nystrom, 615 N.W.2d 302 (Minn. 2000); and Peggy Rose Revocable Trust v. Eppich, 640 N.W.2d 601 (Minn. 2002).  Dave represents clients in arbitrations, mediations, court actions, trials, and appellate work.  Dave is a frequent lecturer and has written numerous articles in the area of Insurance, Construction, and Real Estate Law.  He is also a qualified neutral under Rule 114 of the Minnesota General Rules of Practice (mediation and arbitration).

With the downturn of the MN real estate market, many homeowners have found themselves underwater on their mortgages.  The majority of these homes were purchased at 5-7% interest rates common during the boom years through 2006/2007.  Current interest rates are often below 4%, making refinancing a MN home attractive to take advantage of these substantially lower interest rates.  Trouble is, values are such that many homes will not appraise at a value sufficient to enable refinancing.  No longer is this an issue….HARP 2.0 has arrived.  While details are still coming about about the new HARP 2.0 program, here is what we have so far:

HARP allows homeowners facing difficultiesrefinancing their mortgage through conventional methods to apply for a refinance of their mortgage. A homeowner that is current with their monthly payments but unable to refinance due to a drop in the value is the typical prime candidate for the HARP program. The ultimate goal is to allow a homeowner to do a mortgage refinance for a lower interest rate and overall monthly payment. Here are the general eligibility guidelines for HARP:

• There is no loan-to-value cap in the new HARP, for fixed-rate loans. This is the most significant change of HARP 2.0. Under previous versions of HARP, the LTV could not exceed 125%.
• The loan on your property is owned or guaranteed by Fannie Mae or Freddie Mac. Determine if you have a Fannie Mae or Freddie Mac loan by going online (check Fannie; and check Freddie) or by calling 800-7FANNIE or 800-FREDDIE (8 am to 8 pm ET).
• At the time you apply, you are current on your mortgage payments. You can have one 30-day late payment in the past 12 months, but none within the past 6 months.
• The refinance improves the long-term affordability or stability of your loan.

HARP Changes for Lenders and Effects on Borrowers

The following is a summary of key changes found in HARP 2.0. Some key underwriting details are not yet announced, and are expected to be released before March 2012.

Limited Liability

What’s new: A key provision of the new HARP is that it limits lenders’ liability in cases of loan default. Essentially, Fannie and Freddie will not force the lender to buy back a non-performing loan.

Effect on you: This change should greatly expand HARP’s reach. Lenders will be much more eager to offer HARP loans, where they were previously reluctant. With more lenders participating, you will have an easier time getting a HARP mortgage.

Lender Fees Dropped

What’s new: Fees that Fannie and Freddie charge lenders for high LTV loans are being cut.

Effect on you: The reduced fees are passed on to you, making your loan cheaper. If you are financing to a 15-year or 20-year loan, the fees are cut even further.

Credit Score and Income Requirements Relaxed

What’s new: As long as your new HARP monthly payment is not more than 20% greater than your current payment, specific credit and income guidelines do not apply. The lender will have to determine that the borrower is an “acceptable credit risk” (and what that means is yet to be determined).

Effect on you: A low credit score or high DTI is not enough to automatically disqualify a borrower. Also, if your family is now a one-income family when it was a two-income family on the original loan, you only have to show proof of one income, as opposed to conventional loans where all borrowers listed on the application must document income.

Underwriting Requirements Relaxed

What’s new No. 1: Mortgage Payment History: A HARP lender can approve a loan that has one late mortgage payment in past 12 months, as long as it did not take place in the last six months.

Effect on you: You won’t be counted out for a mortgage late, when that could normally eliminate your ability to get refinanced at the lowest rates available. If you have a recent mortgage late, you can still apply for HARP, once you meet the relaxed mortgage late requirements.

What’s new No. 2: Relaxed Foreclosure & Bankruptcy rules: Your HARP loan could be approved, regardless of how recently a borrower filed bankruptcy or experienced a foreclosure.

Effect on you: Normally, if you filed for bankruptcy or experienced a foreclosure you would have to wait years before you could successfully refinance.

Occupancy Requirements Relaxed

What’s new: Owner Occupancy: HARP loans are no longer restricted only to owner-occupants.

Effect on you: You can now use HARP to refinance your second home or investment property.

Lenders Must Show that a Borrower Benefits

What’s new: Lenders must show that the HARP mortgage borrower derives one or more of the following four benefits in the new loan:

1. Reduce the size of the monthly payment
2. Change to a more stable loan product, such as moving from an adjustable-rate mortgage to a fixed-rate mortgage
3. Reduce the interest rate
4. Reduce the loan amortization term (moving to a shorter-term loan)

Relaxed Condominium Requirements

What’s new: HARP eligibility used to require that no more than 10% of units in the complex be owned by one person and that no more than 20% of owners in the complex be behind on their HOA dues. These requirements are now removed.

Effect on you: More condo owners will now qualify for HARP. If you own a condo, your qualifying for the HARP program is no longer dependent on your neighbors’ finances.

“Condominium owners have perhaps the best reason to be optimistic; lenders are being relieved of the responsibility (for HARP refinance loans only) to ensure that condo projects meet the often strict project approval requirements of Fannie Mae and Freddie Mac,” Citera said. “Borrowers living in condominium projects that have seen a sharp increase in the number of renters, or those that have experienced some level of budgetary stress, will be much more likely to find relief under HARP 2.0 than they have under existing programs (as long as their loans are owned by Fannie or Freddie).”

Hold Your Horses

The majority of HARP 2.0 files will not be approved until sometime after March 1st.  Both Fannie and Freddie must update their automated loan underwriting/approval software by March, 2012. Until then, while lenders may approve HARP mortgages by manually underwriting the loans, loans that are manually underwritten expose the lender to greater risk. If a manually underwritten loan defaults, the lender will be required to buy back the loan.

Given the protections that the lender will have once the automated underwriting programs are updated and ready in March, 2012, it seems very likely that most loan originators will wait until March, 2012. Be ready to move forward with an application, once lenders start taking them, but be prepared for a very long process before your loan closes.

Before refinancing, borrowers should know whether their current loan is a recourse or non-recourse loan and also be familiar with their state’s anti deficiency laws. Refinancing a non-recourse loan could expose the borrower to responsibility for a potentially huge financial obligation where no such obligation currently exists.

Basic HARP Requirements

Not every upside-down home qualifies for HARP 2.0. Here is a summary of the basic requirements:

1. The loan must be owned or guaranteed by Fannie Mae or Freddie Mac
2. The loan was sold to Fannie Mae or Freddie Mac on or before May 31, 2009.
3. The loan was not refinanced under HARP previously, unless it is a Fannie Mae loan that was refinanced under HARP from March through May, 2009.
4. The loan’s current loan-to-value (LTV) is greater than 80%.

WHO TO CONTACT for HARP 2.0 Refinancing in Minnesota

For details on HARP 2.0 Refinancing in Minnesota, contact the preferred lender for the South Metro Real Estate Team.

 These homes for sale in New Prague are all under the $100,000 price point, equating to a mortgage payment of under $500/month.  Many of these will qualify for the zero down USDA Rural Housing loan program, or a 3.5% down FHA loan.  Contact us for more details!

Showing properties 1 - 5 of 19. See more city of New Prague real estate.
(all data current as of 5/18/2012)

1. $79,900 : 300 Central Avenue S, New Prague
   
   3 beds, 1 full bath

   Home size: 1,370 sq ft

   Lot size: 9,147 sqft

   Year built: 1890

   Listed with RE/MAX Advantage Plus
   
2. $44,900 : 309 Lyndale Avenue N, New Prague
   
   3 beds, 1 full, 1 part baths

   Home size: 2,000 sq ft

   Lot size: 12,196 sqft

   Year built: 1960

   Listed with Edina Realty, Inc.
   
3. $25,000 : 436 Main Street SW, New Prague
   
   3 beds, 1 full bath

   Home size: 1,116 sq ft

   Lot size: 10,890 sqft

   Year built: 1900

   Listed with RE/MAX Advantage Plus
   
4. $59,900 : 202 Lincoln Avenue S, New Prague
   
   3 beds, 1 full, 1 part baths

   Home size: 1,534 sq ft

   Lot size: 10,454 sqft

   Year built: 1942

   Listed with RE/MAX Dynamic Associates
   
5. $94,900 : 213 Ladyslipper Avenue NE, New Prague
   
   2 beds, 1 full bath

   Home size: 975 sq ft

   Lot size: 2,178 sqft

   Year built: 2001

   Listed with Global RES
   

Listing information deemed reliable but not guaranteed. Read full disclaimer.

Overall, 2011 was a pretty good year for home sales in the Minneapolis area.  The number of homes for sale were down drastically, and demand seemed to have returned to the marketplace.  The result of this was many properties seeing multiple offers, quicker sale times, and higher list-to-sale-price ratios.  While there wasn’t any appreciable increase in values, there weren’t many drastic declines, either.

The Minneapolis Area Association of Realtors’ has released the 2011 Annual Housing Report.  In here you will find raw data about the 13 county Minneapolis/St. Paul Metro Area.  This includes sales numbers, inventory, and pricing data.

Here are the top 10 local items to note:

1) Closed Sales – Increased by 8.2% in the 13 county metro area

2) Shakopee – Higher demand for townhomes means townhomes/condos make up 36.7% of all home sales.  58.5% of all sales were short sales or foreclosures.

3) Carver – New construction accounted for 37.3% of home sales.  Overall home sales up 13.6%.

4) Chanhassen – 22.2% of homes sales were new construction.  370 homes sold, an increase of 23.3% over 2010!

5) Elko New Market – 75% of home sales in 2011 were distressed properties (Short Sales or Foreclosures)

6) Belle Plaine – 59.2% of homes sold were distressed.

7) Eden Prairie – Home sales increase by 11.4%.

8.) Savage – Home sales UP by 41.2%!

9) Prior Lake – 452 homes sold, an increase of 11.6%.

10) New Prague – Over half (55.9%) of all home sales were distressed properties.

As you can see, many areas saw increases in overall home sales over 2010.  2012 is looking to be a great year for MN real estate.  Continuing low levels of inventory will help stabilize many areas, and pent up buyer demand may actually result in value increases!  Stay tuned!