Mortgage Refinance Deals Save Homes in Minnesota

By Joe Taylor Jr.
Local Lender Columnist
Apr 16, 2007
Minnesota's urban areas, especially the Minneapolis/St. Paul region, have been especially hard hit by a sluggish economy. Some statistics show foreclosures there have increased more than 100% in a year. Unexpected job losses can take families with bad credit by surprise, so experts recommend taking advantage of mortgage refinance deals before late payments pile up.

Adjustable-rate, interest-only, and negative amortization mortgages frequently allowed people to buy more house than they could afford. In many cases, these creative mortgages help Minnesota residents purchase their own homes with little or no money down. When homeowners roll too much unsecured debt into a mortgage refinance package, the risk of default or foreclosure skyrockets.

Optimistic Minnesota residents might have signed deals on interest-only mortgages at a time when employment and real estate prospects looked bright. As introductory mortgage rates expire and fluctuating payments kick in, an essential raise or promotion that fails to come through could send a family into despair.

Minnesota Still Holds Hope for Bad Credit Borrowers

Credit experts advise that if you find yourself in a situation where you might fall behind on some payments, you should pay your secured debts first. Mortgages and car payments should take precedent on your list before unsecured credit cards or household luxuries. If your home has appreciated in value and you can keep your other spending in line, a mortgage refinance can help you consolidate debt under a favorable, fixed mortgage rate.

Minnesota is still a good place to invest in real estate, if you do it wisely and within your means. Several areas, including lakeside neighborhoods, suburban areas, and the northern part of Minnesota are booming and property values are appreciating nicely. With housing values still appreciating in Minnesota, you can make an investment that will pay off

About the Author
Joe Taylor Jr. has covered business and finance news for Financial Times Television and CNBC. He coaches beginning mortgage brokers to provide better customer service and to understand creative financing opportunities.