Minnesota is a large state located in the northern midwest part of the United States. The state is surrounded by Canada to the north, Wisconsin to the east, North and South Dakota to the west, and Iowa to the south. Overall, Minnesota is the 14th largest state based on land area and the 20th largest state based on population. As of 2015, Minnesota had an estimated population of just over 5 million residents. 3.5 million of the residents in Minnesota live in the Minneapolis-Saint Paul metro area, which makes it the 16th largest metro area is the US.
Mortgage Laws in Minnesota
The specific mortgage laws in Minnesota are comparable to laws in other states across the country. There are recent statutes that have increased the requirements in regard to borrower income and credit scores. However, unlike many other states, Minnesota mortgage law still allows for mortgages with negative amortization or longer periods of interest-only financing.
Mortgage Rates in Minnesota
Interest rates in Minnesota today are in line with rates found in other midwestern states. While rates were a little bit lower just a few months ago, the interest rates today are still considered very affordable compared to historical standards. The average rate for well-qualified borrowers on a 30-year mortgage is 4.15%. Those that are looking for a shorter amortization loan can get a 15-year mortgage for around 3.25%. Borrowers that have less than a 720 credit score, or will have a tighter debt-to-income ratio, may have to pay a higher interest rate.
Outlook for Housing in Minnesota
While Minnesota was impacted by the housing bubble and credit crunch, it has fared well in the overall recovery. The housing market in the Minneapolis area has seemed to remain strong as housing prices align well with the medial household income. It is expected that as the economy improves over time the housing market in Minneapolis will improve as well.
While Minneapolis has not struggled, some of the smaller communities, particularly those based on tourism, have not done as well. Minnesota is well known for having over 10,000 lakes, which has led to a significant amount of vacation homes. This particular sector of the state’s housing market struggled during the credit crunch, but has been improving as well.
5 Largest Cities in Minnesota
While Minnesota is a large state full of smaller communities, there are several big cities in the state as well. The most populated city in the state is Minneapolis, which has a population of 410,000 residents. Saint Paul, which is located adjacent to Minneapolis, has a population of 300,000 residents and is the second most populated city in the state. The next three most populated cities are Rochester, Bloomington, and Duluth, each of which has populations around 90,000 residents.