Be Prepared To Buy A New Home

Whether you are a first time home buyer or are looking to move to a different home, beware that we are in a different environment than we were 2-3 years ago.

Key items you should know before purchasing a home:

1) Know your own credit: You may obtain a free copy of your own credit report annually from www.annualcreditreport.com.  It is important that you have credit and that the credit you have is clean. You should get copies of your credit report a few months before you start house hunting.  Make sure all the facts are correct and fix any problems you may discover.

2) Have some savings or equity that you can use towards a new purchase: You will need money for the down payment, closing costs, and the first year homeowner’s insurance. You also want to have a reserve fund in the bank after your new purchase.  As a homeowner, you never know what you may need to repair.

3) Meet with your banker and be pre-approved: Meet with someone that you know will have your best interest in mind.  They will go through your credit, look at your current payments and determine what you can afford for a house.  A good rule of thumb is to compare your current house or rent payment to your new proposed payment.  Do not try to buy more house than you can afford since you will have these payments for a longtime.  Rely on your banker to lay out product options for you and then together you can determine which loan is right for you.

4) Plan for your future: When you become a homeowner, you are responsible for all the maintenance, yard care, property taxes and homeowners insurance.  All of these items should be factored in as an expense in addition to your monthly principal and interest payments.

Purchasing a new home will be one of the most important purchases of your life.  Work with someone that you know and trust to provide you with a good experience.

By: Maria Anderson, Asst. Vice President

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National Teach Children To Save Day

For the past six years, Citizens Bank Minnesota has participated in “National Teach Children to Save Day”. In that time we have reached out to 4,800 students between all of our locations. The purpose of “National Teach Children to Save Day” is to help raise awareness about the importance of saving money as well as to teach youth how to develop lifelong savings habits early in life. 

Citizens has chosen to focus on second graders for “National Teach Children to Save Day”, so every April, a group of bank employees go and visit all of the elementary schools in the surrounding areas. We present them with a fun, interactive 30-minute presentation. We start the presentation by asking them if they know what it means to save. We also ask them if they know the different places they can save their money and then we jump into a fun game. The game consists of splitting the class of second graders into two different groups; one group represents a savings account at a bank and the other group represents saving in a piggy bank. We pass out pretend money, using Laffy Taffy, and students take turns making deposits into either the bank or the piggy bank. After each round, we show them how the bank adds interest to the bank account, by adding more Laffy Taffy. At the end of the game, the bank account is over flowing in comparison to the piggy bank.  We then ask the students where they would like to save their money. They all undoubtedly respond “the bank” because they can see how much more the bank account has accumulated from earned interest, whereas the piggy bank does not. 

We also teach the students about the safety of keeping their money in a bank versus a piggy bank at home and also about savings goals. One thing that absolutely amazes me each year when we do the presentation is the response we get when we ask the students what their long term savings goals are. College is usually the number one response to this question which, I think, is great for second graders! 

At the end of the presentation and after all of the students’ questions have been answered, we give them a coupon to come see us at Citizens so we can start a savings account for them. 

Learning the importance of saving early is crucial for a lifetime of good financial habits and participating in “National Teach Children to Save Day” is one way Citizens is helping raise that awareness while giving back to the community at the same time. 

By: Pamela Stoltenberg, Personal Banker/Assistant Branch Manager

A Worry-Free Vacation!

With all of the excitement preparing for vacation, we tend to forget a couple of important items.  We have to remember to turn down the furnace, have the newspapers stopped, have your mail held, etc., but you also need to remember to contact your bank and your credit card company. 

There is so much fraud, with identity theft being a big issue everywhere.  This has prompted many banks and credit card companies to take action and try to catch any suspicious activity in areas where the cards are normally not used and alert their customers.  If suspicious activity is thought to be happening, the credit card company will usually call you and inform you of the activity going on with your card and, if you have not made these transactions, they will shut down your card immediately. 

Make sure to keep your cards in your possession at all times and use them only at places you feel are safe merchants.  Also, make sure your card is returned to you after the transaction is complete. 

1)       Debit Cards – Call the bank to let them know you are going on vacation.  You may not realize it, but there are some states that are blocked and some that allow pin based transactions only.  If you call the bank, we will put a note on your account for the dates you are going to be gone and where you are going. 

2)       Credit Cards – Call your credit card company to let them know you are going on vacation.  They will need to know when you are going to be gone and where you are going.  They will flag your credit card so that when they see some activity going on in a different state or country, they know that you are there. 

If you do not call your bank and/or credit card company, you may not be able to use your cards while on vacation. 

Follow these easy steps and you should have no problems when you travel. 

Enjoy your vacation! 

By: Lori Kollmann, Office Manager

Citizens Bank Minnesota Partners With Farm Service Agency Lending Programs

Citizens Bank Minnesota assists borrowers who utilize Farm Service Agency Lending Programs.  This assistance can range from beginning Farmer Loans to FSA Guaranteed Operating and Real Estate Loans.  Citizens is a Certified Lender with the Farm Service Agency which means that the application process is streamlined with minimal paperwork.  We have several lenders trained to walk you through the process.  A current popular lending partnership that the Bank has with Farm Service Agency is the Beginning Farmer Down payment Loan Program.  This program enables a beginning farmer who has less than 10 years experience to purchase a farm with favorable loan terms.  Terms and conditions of the loan program are as follows:

  1. Loan funds must be used to purchase farm real estate.
  2. Purchaser must have at least 5% cash down.
  3. The Bank will finance 50% of the purchase price with a 1st mortgage on the property with the loan begin repaid over a 30 year period.  Interest rates are at the Bank’s normal rates and terms.
  4. The Farm Service Agency will finance 45% of the purchase price at an interest rate fixed for 20 years.
  5. The borrower must qualify as a beginning farmer, which means that he cannot have operated a farm for more than 10 years and he does not own a farm greater than 30% of the median size farm is in his county.
  6. The beginning farmer may be required to be enrolled in an Adult Farm Management Program.

In addition to the Beginning Farmer Down payment Loan Program, Citizens can also provide Farm Service Agency guaranteed operating and farm ownership loans.  Guaranteed loans cannot exceed $1,119,000.00.  Loan purposes can be for annual operating needs, equipment purchases, real estate purchases or debt refinance.  Our Bank lending officers fully understand the Farm Service Agency loan programs.  We are here to assist you in filling out the necessary Balance Sheets, Cash Flows and Application forms.  Our Certified Lending Status makes the application process much easier than applying directly with the Farm Service Agency.  Citizens will be happy to assist you.

By: Kevin Yager, Vice President

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IRA – An Important Silo in Retirement Planning

Saving in an Individual Retirement Account (IRA) is an important way to prepare for retirement. A traditional IRA will grow tax-deferred and a Roth IRA will grow tax-free. The reason so may people are investing in IRA’s is that they realize personal savings will provide an important part of their retirement income. Personal savings and IRA’s are one of three silos in the retirement planning world. The other two are company sponsored retirement plans and Social Security. 

By: Cindy Lewis, Client Services Director

Minnesota State Rural Finance Authority Lending Programs

Citizens Bank Minnesota is an approved lender to participate with the Minnesota Rural Finance Authority Loan Programs.  The State loan programs are established to help individuals who farm in Minnesota and offers affordable financing at reasonable rates and terms.  The State offers multiple lending programs ranging from buying a farm, building livestock facilities or restructuring existing farm debt.  The State of Minnesota participates with the local lender in providing the credit needs to Minnesota farmers.

The most popular program is the Basic Farm Loan Program which is used to purchase farmland.  The farmer must be a resident of Minnesota.  They must be a full time farmer or intend to become a full time farmer.  The loan applicant’s maximum net worth is $409,000.00.  The local Bank is the primary lender and finances 55% of the first mortgage on the property with the Bank’s normal rates and terms.  45% of the loan will be financed by the Rural Finance Authority up to a maximum of $300,000.00.  The farmer applicant works with the lending officer at our Bank to fill out the application and loan documentation requirements.  All loan payments are remitted to the Bank and the Bank forwards the State’s portion of the payment to St. Paul.  The State requires the borrower to be enrolled in Farm Management Classes and obtain all necessary State and County permits.

The Minnesota Rural Finance Authority also has an Agricultural Improvement Loan Program.  This loan program is for any physical improvement to the farm operation and a first real estate mortgage is required on the entire farm.  The State of Minnesota participates at 45% of the first mortgage to a maximum of $300,000.00.

The Minnesota RFA has a livestock expansion loan program which finances the construction of new efficient livestock facilities.  To be eligible for this program, the farmer applicant cannot have a maximum net worth exceeding $772,000.00.  The State of Minnesota will participate at 45% of the mortgage amount to a maximum of $400,000.00.  The farmer must be a full time farmer and have all necessary feedlot permits.

The Livestock Equipment Pilot Loan Program is to purchase livestock related equipment.  Equipment purchased will be security for the loan.  RFA will participate at 45% of the equipment loan amount up to a maximum of $40,000.00.

The State of Minnesota’s Restructure II Program is to provide restructuring for existing agricultural debt only.  A first real estate mortgage is required.  The RFA participates at 45% of the first mortgage amount to a maximum of $400,000.00.  The maximum net worth of the loan applicant cannot exceed $772,000.00 and the operation must have a positive cash flow.

As you can see, there are a variety of lending programs through the State of Minnesota which are available for our farm customers.  Our experienced Bank lending officers and staff can assist a loan applicant in preparation of the financial statements, cash flows, and application and make the process very easy for you.

By: Kevin Yager, Vice President

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