The temporary high-balance loan limits for Conforming GSE (Government Sponsored Entities) and FHA loans have been extended through 2010.
This means the current loan limits set to expire this year will continue through next year. This will help keep the real estate market on track for recovery. According to a related blog on Zillow, the bill only needs President Obama’s signature which should happen in the next few days. No word as to whether the VA plans on extending their high-balance loan limits through 2010. This is typical for the VA as their guidelines usually change shortly after changes have been made to conforming and FHA loans.
Here are the links to search for your loan limits by area:
CNBC reported on October 28th that the $8,000 First-Time Home Buyer Tax credit will be extended through April 30th, 2010 and will include a credit for “Move Up” buyers.
The reports were given by Senate Majority Leader- Harry Reid’s office to CNBC.
Earlier this week, negotiations of the credit included multiple variations of an extension as mentioned in a related blog post. The new bill is different than any of the previously mentioned bills.
The new bill also includes a $6,500 credit to “move-up buyers”. This is designed to motivate existing homeowners to sell and buy new homes. Spencer Rascoff, COO of Zillow.com, talked in his interview on Bloomberg about how approximately One-Third of all home-owners would consider selling under the right circumstances. These homes are what he called “Pent Up Supply.” Giving a tax credit to move-up buyers may help boost the market further.
The current plan is to include the tax extension in the Unemployment Extension Benefits Bill scheduled to be voted on in the next few days.
UPDATE
The bill has already been voted on and has passed through the senate. The details of the bill are finalized and I expect the bill will be signed by President Obama in the upcoming weeks.
We have one half of the bill makers in agreement. Senate Banking Committee Chairman Christopher Dodd reported Tuesday that top Democrats in Senate have reached an agreement to extend the $8,000 first-time homebuyer tax credit.
We’re now just waiting for the Republican and Democratic party to agree to the terms of the extension, which may be reached by the end of this week.
There is talk of opening up the credit to all buyers, which I believe could be helpful in moving first-time homebuyers to purchase as well as homeowners who need an incentive to sell their house.
The current $8,000 tax credit for first time home buyers is set to expire in approximately a month. Since then, there has been a rush for buyers to find a home and close before the December 1st, 2009 deadline.
In a related CNBC interview, several industry experts discuss whether extending the tax credit is a good idea and some details of some of the bills currently in Congress.
Every day, I watch a small internet video news report for mortgage professionals from a website called, “Think Big Work Small” (www.TBWS.com).
In today’s broadcast, Frank Garay and Brian Stevens (the hosts of the show) shared some information that I thought I would share.
In World War II, the government issued millions of dollars in War Bonds that were set to mature in 40 years, which means they would all mature by 1985. However, many people have not claimed their bonds either because they forgot or didn’t live long enough.
Fri. Oct. 23 2009 | 8:15 AM ET
Discussing extending the homebuyer tax credit, with Howard Glaser, former HUD secretary counselor; Shari Olefson, Fowler White Boggs; and CNBC’s Trish Regan.
The IRS (Internal Revenue Service) is reporting there are more than 100,000 suspicious claims involving the $8,000 first-time-home-buyer Tax Credit. Currently there are 167 criminal cases regarding the tax credit.
As the December 1st, 2009 deadline for the tax credit nears, many hope Congress will extend and even potentially increase the tax credit. With over one million claims submitted, there’s no question of it’s success.
He felt that we won’t hit the floor for values until late 2010, but it varies by region. He gave an example, showing that Boston had hit it’s floor in early 2009 and is already rising. This is an important factor for homeowners to consider when looking to buy or sell a home
Recently, I was having lunch with my friends Rob Novak (fellow Loan Officer) and Andrew Norman from ING. It was one of those lunches where topics moved left to right without filters or agenda. While sharing ideas and opinions of the current marketplace, the topic of first time home buyers was mentioned. At that moment, I told Andrew, “By the way, if any of your clients have children who are looking to buy their first home and would like to get more for their money, tell them to buy a multi-family.”
From that statement, we started to discuss all the benefits of why a first time home buyer should buy a multi-family. Within a 2 minutes of talking about this, I wondered “Why didn’t I think of this earlier?!” FHA has always allowed buyers to use FHA financing to buy a multi-family as their primary residence. They even let the buyer use the rental income for the other units to qualify.
The basic concept is simple. The buyer buys a duplex, triplex or four-plex with the same 3.5% down payment requirement as a house. They rent out the other units and cover the difference from the mortgage payment as their share. If the homeowner decides many years later that living in a multi-family doesn’t fit their lifestyle, they either sell the property or move out and rent the unit they were living in.
There is a new bill being introduced that would increase the minimum down payment for FHA loans from 3.5% to 5% (HR 3706).
I understand that some congressman want to protect the financial stability of HUD as well as the American people. The last thing we need is a bunch of FHA foreclosed homes on the market.
However, I don’t believe this is the answer. Yes, that sounds pretty bias considering the fact I’m a mortgage loan officer and my job is to help people get loans, but the loss of 100% financing never scared me and my business has only grown since the market has downturned.
I’ve always found it interesting that there are so many websites that claim to have a listing of foreclosed homes. Many of them claim they have HUD (US Department of Housing and Urban Development) foreclosures which are foreclosed homes that had FHA loans.
Though many of these listings may be accurate, there is only one real source to find HUD foreclosures. HUD contracts different management companies to handle their listings, meaning the websites that list real HUD foreclosures haven’t been easy to find. For instance, Ten Management is the company that lists HUD foreclosures for Washington state, as well as many other states.
