About McLeod County, MN

Every day someone asks me if anyone can get financing to buy homes any more. I usually answer them by telling them that they need to quit listening to all the doom and gloom in the media. Then I answer them, that yes, buyers can still get financing.

Although the number of mortgage companies that will finance 100% of value has diminished, there are still some programs in Hutchinson with 100% financing available to qualified buyers. We are in a Rural Development Area which means that buyers who have qualifying incomes and a FICO score over 620 can still obtain mortgages up to 100%.

Also we are seeing more activity in FHA loans because they only require a 3% down payment and they also require a lower minimum FICO score.

Between the State of Minnesota and our local Hutchinson Housing Redevelopment Authority, there are numerous assistance funds available. Some of these programs are for down payment assistance (up to $15,000) and others are for monthly payment assistance. All of the assistance programs are conditional on the buyer's qualifications.

So, favorable financing options are still available.

Back in the fall of 1999, Hutchinson Technology had a significant layoff (about 700 employees if I remember right), and so I went back to my records to see how the housing market in Hutchinson was affected. The first thing I found was that the vacancy rate of rentals increased significantly. Many of the laid off employees were renters who moved to new locations for new jobs.

What we saw in the sale of homes was that the number of sales dropped 15% from 1999 to the end of 2000. However, the average sale price from 1999 to 2000 increased about 3%. The general economy is different now than it was in 1999. So it might not be as easy for the HTI employees that were just laid off to find other employment as it was in 1999. So, I believe that we will find the real estate market in Hutchinson during 2009 to be challenging. If history repeats itsef, we may very well see the number of home sales drop from 2008 to 2009.

That being said, it's important for those people who find themselves unable to meet their mortgage payments to know that there are other choices than just letting the home go back to the bank. Loan modifications and short sales are common place with the mortgage lenders today and they will work with homeowners to help them out during difficult times. We will be happy to explain the difference between short sales and foreclosures to you. Or call your lender and see what choices you have.

Tomorrow one of Hutchinson's major employers will be laying off a significant number of employees. In a way, I'm sure that most will be glad when tomorrow is over. The employees were told about a month ago that there would be a large layoff starting Jan. 12. I haven't spoken to a single employee during this last month who wasn't sure that they would be one of them to lose their jobs. At least when tomorrow is over, the 75-80% who aren't losing their jobs will be able to breathe a sigh of relief. I have terrific faith in Hutchinson as a community and know that we will all pull together and see this thing through. We will be thinking about all of the HTI employees and their families.