Barker and Hedges Real Estate Blog

Credit Crunching Potential Home Buyers

It has been all over the news that lenders are tightening their requirements for borrows. Even in the thick of this credit crunch, though, there's plenty of money available for home buyers – if you have good credit and a hefty down-payment. People with less-than sparkling credit and without enough of a down-payment will most likely encounter problems with getting a loan. As the credit crunch drags on and lenders try to stem the flow of additional losses even as the government tries to stimulate the languishing housing market, it can be expected that the mortgage lending landscape could get interesting. Well, more interesting.

It’s not enough to have a higher credit score, there's a good chance your lender will be scrutinizing your debt-to-income-ratio and requiring that it go lower.  Though during the housing boom lenders approved borrowers with debt obligations that surpassed more than 55 percent of their gross income, there is definitely a shift occurring in the mortgage market. In fact, Freddie Mac will require manually underwritten loans to meet a debt-to-income ratio of 45 percent, beginning in March 2009. Other lenders are expected follow suit.

The reason behind this is that many borrowers with high debt-to-income ratios did default on their mortgages. However, there may be times when a higher debt-to-income ratio is inescapable, like if a borrower has a steady base income, but relies on regular commissions that aren't taken into account as long-term income. Restricted debt-to- income requirements could also hurt borrowers who don't want to include their spouse's income in their application even though that income will be used to help pay the bills.

For many borrowers with lower incomes or high debt-to-income ratios, the Federal Housing Administration (FHA) has been their only hope for mortgage approval, because it offers low down payments and more...

Two Holidays Down with One to Go

I don’t know about you, but I’m finding it hard to adjust back to “work mode” following this middle-of-the-week Christmas.  Depending on if you celebrate Kwanzaa or Hanukkah, you could very well still be celebrating!  Thanksgiving, with its long hours of cooking and even longer hours with extended family, was just one month ago.  Add in all of the preparation craziness that happens between these two holidays (and even more family time), and I’m sure I’m not alone in being just a little tired of celebrating, but not quite ready to face the “real world.”  It is nice to know that there is at least one more excuse we can give ourselves for not having our heads entirely in the game: New Year’s Eve!

My friends have somewhat of a New Year’s tradition of gathering at a home, bringing lots of tasty finger-foods and “pot luck” style dishes along with bottles of champagne.  We play games, listen to music, get a little rowdy, and watch the ball drop.  Most everyone stays the night, ensuring that we all stay safe.  From the sounds of it, that is probably what we’re going to do again this year.  But if not, there is a variety of Plan Bs to choose from, because something is always happening here in the Twin Cities! 

First, starting at 10:00 AM at Saint Paul’s Como Park Zoo and Marjorie McNeely Conservatory, is the kid-friendly “Noon Year’s Eve” event.  Rock in the "Zoo" year with your friends at the Como Zoo! The fun is perfectly fit for the whole family, with live entertainment by Radio Disney, crafts, activities, and a countdown to Noon.

The next notable event, the final showing of the Holiday Lights...

A Christmas Post (The Riverview Theater)

Perusing the Twitter boards today in Saint Paul and Minneapolis, I see that a lot of people are going to the Riverview Theater tonight to see a presentation of the classic holiday movie, “A Christmas Story.”  It’s playing right now (5:00 PM) and at 7:00 PM tonight, if you haven’t made any plans for this evening yet and you’re looking for something to do.  After all this cold weather we’ve had, it just might be worth it to get out of the house for a while! So, in light of the looming holiday and this great activity that is going on tonight, I thought that I might write a little bit about the Riverview Theater, located at 3800 42nd Avenue South in Minneapolis.

The Riverview Theater was built in the late 1940s by Sidney and William Volk, who wanted to replace the aging Falls Theater that had been located on Minnehaha Avenue. They arranged to have Jacob J. Liebenberg & Seeman Kaplan, the premier theater architects of that period, build what was to be one of the finest theaters of the time period. 

Libenberg and Kaplan designed over 200 theaters throughout the Midwest during their careers. The pair created the Granada (Suburban World, 1927-28), the Wayzata (1932), the Edina (1934), the Hollywood (1935), the Uptown (1937), the Varsity (1938). And those are just the ones that are still standing!

When the Riverview Theater opened on December 30, 1948, it was such a notable event that...

The Twin Cities makes Forbes top 10 list for long term Real Estate bets

There is no doubt that the Twin Cities real estate market (along with 95% of the US) has taken a significant hit over the last year or two.   I have always believed that our market is less volatile then most larger markets.  We usually don't see values increase as quickly or decrease as quickly as many US cities.  This Forbes Article  explains how much better off we are in Minnesota for the long term....

Good and Green

New around here, I thought it would be a good idea to tell a little more about myself.  Earlier I wrote about how I like weird stories, odd facts, and the like.  Another thing I like to discuss is living a green life, and all the cool ways people can be more friendly to the earth. 

How does this apply to real estate? It has lots to do with real estate!  Green building is an industry that is growing quite quickly.  An increasing number of today’s new home buyers are aware of their impact on the environment and are insisting on the availability of earth-friendly houses.  Twin Cities new home builders are building green homes to satisfy demand.  In fact, earlier in this blog it was reported that green building is making an appearance on a very public stage in Minneapolis as the Target Center is getting a green roof, which will last longer than conventional roofs and will cut down on energy bills. 

Also, being kind to the environment and encouraging some “tree hugging” can be helpful to all Twin Cities residents.  You wouldn’t know it unless you travel regularly to large cities, but one thing our metropolis has that many others lack is a significant urban forest from all those great and green Minneapolis and Saint Paul Parks.  Because of the carbon monoxide and other chemicals that trees help to filter out of the air, the fumes from all the cars on the road aren’t completely choking us.  Not only are they beautiful, provide great places for recreation, and filter out toxins, but trees and parks increase land values, meaning all the green foliage can help to put a little green in your asset column. 

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Strange-But-True: Rent To Own ?

Just a few days ago, I wrote about how I like odd stories and I highlighted the “Strange-But-True” posts that have appeared on this blog.  Now I get the chance to write my own! 

In this tumultuous and flooded real estate market, sellers are trying like crazy to attract buyers to their home and devising ways to make it stand out from the crowd.  At the same time, troubled banks are unwilling to hand out money very easily and buyers are finding it hard to get loans.  As a result, an unusual prospect is emerging to help buyers and sellers alike: rent to own your home.

Okay, so it’s not all that strange of an idea. Lease to own or rent to own has been around forever, but think of the concept for a minute: I’m a prospective first time home buyer, renting a home already.  The last thing I want to do is enter another lease agreement.  But I don’t know if I’ll be pre-approved for a loan yet, I’m a little nervous.

Like many others, I made some pretty bad financial mistakes when I was in college. Not life-ruining mistakes, but enough that I learned the hard way how not to over-use credit ever again.  Though with this goal of a home I’ve been repairing my credit, I don’t actually know if I would qualify yet for a mortgage even in good financial times.  I’ll have to buck up soon and find out if I qualify for a mortgage, one way or another. If I find out that rent-to-own is the only way that I could possibly have a house to call my own in the next few years, I would consider it.

The trend of leasing-to-own isn’t just helping out home buyers, though.  ...

Snow Emergencies in Minneapolis and Saint Paul

The season of Snow Emergencies has finally begun! If you live in Minneapolis or Saint Paul and you park on the street, it would be a good idea to move your car, as the first Snow Emergencies of the winter have been declared in both cities.  You have a little time, though, as Snow Emergency parking regulations begin at 9 p.m. tonight, December 20. 

Minneapolis and St. Paul officials are sticklers when it comes to clearing the roads quickly, usually resulting in hundreds of vehicles landing in the impound lot during heavy snows.  It will cost nearly $300 to bail your car out. So close to the holiday, you know that money could be put to much better use.

Saint Paul and Minneapolis have both tried innovated ways to warn residents about snow emergencies.  Minneapolis is posting snow emergencies on Facebook and Myspace pages.  St. Paul, on the other hand, had an automated system that would call residents to notify them of snow emergencies, but it was the Code Red system was discontinued this year.

Interested in knowing more about the parking rules of the Twin Cities? 

Minneapolis snow emergency information

Saint Paul snow emergency information

Other cities throughout the metro area have different rules for parking in the winter. Most restrict or prohibit evening and overnight parking...

The Weird Factor

Because I’m new around here at the Barker & Hedges blog, I’ll share a little bit about myself.  One thing that important to know about me is that I like weird stuff. Weird news, odd facts, strange structures…  I have particularly liked the Strange-But-True real estate stories that have been highlighted in this blog:

So, imagine my giddiness when I found this post at Twin Cities Tour Guide....

Minnesota First Time Home Buyer Site

A good place for first time home buyers to find information about buying a house in the Twin Cities area is at the Minnesota First Time Home Buyer Website.  Here, you can find information about state, county, city, and even neighborhood home buying programs.  In the coming weeks, even more will be added to the site, including forum where first time home buyers will be able to discuss their experience with the process.  Be sure to check in often to what is new!...

New Writer, New Perspective

Hello there!  I’m new around here at the Barker & Hedges site. I’m not a Realtor or agent in any way nor am I directly involved in the profession. I am actually a professional writer, but beyond that, I have another interest in real estate. And that is, I want to be a first-time home buyer.

As a new contributor to the site, I’ll be talking and writing about concerns about real estate from a consumer point of view.  On my journey through the process of purchasing a home, I will post updates about my own personal experiences.  While researching my future purchase (as any potential home owner should be doing), I’ll share pertinent or interesting information I come across that could be useful for home buyers. I may even find some interesting stuff to tell home sellers, I’ll not get ahead of myself. 

In the posts coming in the weeks and months ahead, I hope we get to learn together.  Feel free to throw out ideas for posts in the comments sections or important topics you think I should cover.  In the meantime, here is an article from the Star Tribune that lists some good real estate books for all types of home owners and potential home owners. Whether you’re trying to buy a home, sell a home, retire to a far-off place, or are trying to stave off foreclosure, there is sure to be something there to interest you.

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