The homebuyer tax credit is one of 10 key provisions of the American Recovery and Reinvestment Act signed by President Obama into law on Feb. 17, 2009.
The bill provides for a $8,000 tax credit that would be available to first-time home buyers for the purchase of a principal residence on or after January 1, 2009 and before December 1, 2009. The credit does not require repayment. Most of the mechanics of the credit will be the same as under the 2008 rules: the credit will be claimed on a tax return to reduce the purchaser's income tax liability. If any credit amount remains unused, then the unused amount will be refunded as a check to the purchaser.
E-mail me at MikeHutson@prusny.com and I will send you a copy of the plans highlights.
Wednesday, February 18, 2009
First Time Homebuyer tax credit
Below is a site for details regarding First Time Homebuyer tax credit.
http://www.realtor.org/wps/wcm/connect/b32db1004d05f6338052c5fd73e5610f/government_affairs_tax_credit_chart_021308.pdf?MOD=AJPERES&CACHEID=b32db1004d05f6338052c5fd73e5610f
http://www.realtor.org/wps/wcm/connect/b32db1004d05f6338052c5fd73e5610f/government_affairs_tax_credit_chart_021308.pdf?MOD=AJPERES&CACHEID=b32db1004d05f6338052c5fd73e5610f
Thursday, February 5, 2009
Right now everything depends on your loan-to-value ratio. The best rates (below 5%) are reserved for the conforming loans (below $417k) with a loan-to-value below 60%, where the borrower is willing to pay up to 1 point.
If you are looking at the new High Balance loans (between $417k and $625.5k), there are now huge rate penalties for taking cash out or for a total loan to value (including any seconds or equity lines) up to 80%. You will get the best rates (mid-5%'s) is your loan to value is below 60% and you can pay up to 1 point.
There are still decent rates on jumbo 5/1 ARMs: around 5.125%, with 1 point.
Lenders are not only penalizing for high loan to values, but they are pricing their products such that "0" points loans don't make much sense any more; you get a much larger bang for your buck if you can pay 1 point, or even a little more. The 1 point can still be financed into your new loan, but please make sure that you plan to stay in the home for at least a few years so that your investment in your new loan makes sense.
Many of my clients are saving $300 to $400 per month by refinancing, so it can be well worth it if you are already in a pretty good position. If you bought your house fairly recently with 5 or 10% down, you will probably not be able to take advantage of these new low rates -- which is a shame.
Web Reference: http://natashalovas.com
If you are looking at the new High Balance loans (between $417k and $625.5k), there are now huge rate penalties for taking cash out or for a total loan to value (including any seconds or equity lines) up to 80%. You will get the best rates (mid-5%'s) is your loan to value is below 60% and you can pay up to 1 point.
There are still decent rates on jumbo 5/1 ARMs: around 5.125%, with 1 point.
Lenders are not only penalizing for high loan to values, but they are pricing their products such that "0" points loans don't make much sense any more; you get a much larger bang for your buck if you can pay 1 point, or even a little more. The 1 point can still be financed into your new loan, but please make sure that you plan to stay in the home for at least a few years so that your investment in your new loan makes sense.
Many of my clients are saving $300 to $400 per month by refinancing, so it can be well worth it if you are already in a pretty good position. If you bought your house fairly recently with 5 or 10% down, you will probably not be able to take advantage of these new low rates -- which is a shame.
Web Reference: http://natashalovas.com
Tuesday, February 3, 2009
Best Buy in Town at Cedar Ridge:
Cedar Ridge is a new subdivision with homes ranging form $158,000 up to $205,000. Cedar Ridge still has special financing on new construction. If you qualify for the financing through National City you could get up to 1.50% below the current market rate. All the financing questions can be answered by Brad James, Brett Winters and Scott Dillon at National City Mortgage.
For more information view a direct link at : http://michaelhutson.com/Content/Content.aspx?ContentID=527262
Cedar Ridge is a new subdivision with homes ranging form $158,000 up to $205,000. Cedar Ridge still has special financing on new construction. If you qualify for the financing through National City you could get up to 1.50% below the current market rate. All the financing questions can be answered by Brad James, Brett Winters and Scott Dillon at National City Mortgage.
For more information view a direct link at : http://michaelhutson.com/Content/Content.aspx?ContentID=527262
Real Estate Is a Solid Long-Term Investment
The news media is all abuzz these days with information about the real estate market. But if you rely on national news stories to tell you whether now is a good time to buy or sell, you may be missing a great opportunity. To get the proper perspective on the value of real estate, you have to go right to the source and that means talking to a REALTOR® in your local market.
Perceptions about real estate have been skewed in recent months due to the overwhelming focus on national figures. Real estate should be viewed at the local level. While average sales and prices help us identify trends, the fact is all real estate is local – conditions vary greatly from one city to the next. Unfortunately, that news is largely unreported and can be misleading if looked at Nationally.
Here are the facts on three popular misperceptions in the real estate market:
Misperception: No one is buying a home, and home prices are falling rapidly.
Fact: According to the Illinois Association of REALTORS®, home sales are expected to reach about the same level that we saw in 2000, which was still a great year for real estate. Nationally, this year is projected to be the fifth best year on record for home sales. That means an approximate 5.5 million homes will be sold in this year alone.
Fact: While it’s true that the growth rate for Illinois median home prices is down slightly from last year, the median home price in Illinois has increased more than $40,000 since 2002. And, the Chicago metro area showed over a four percent price gain in the third quarter of 2007 compared to third quarter 2006. Again, each market varies. A significant share of metro areas in the state saw gains in the median price in the third quarter of 2007.
Misperception: Foreclosures and delinquencies are rising rapidly in every state.
Fact: According to RealtyTrac, Inc., three states – California, Florida and Nevada – are responsible for most of the increase in foreclosures in the third quarter. Illinois actually saw a 4.2 percent decrease in foreclosure filings in the third quarter compared to the second quarter of this year.
Fact: The reasons for foreclosures vary from state to state.
The news media is all abuzz these days with information about the real estate market. But if you rely on national news stories to tell you whether now is a good time to buy or sell, you may be missing a great opportunity. To get the proper perspective on the value of real estate, you have to go right to the source and that means talking to a REALTOR® in your local market.
Perceptions about real estate have been skewed in recent months due to the overwhelming focus on national figures. Real estate should be viewed at the local level. While average sales and prices help us identify trends, the fact is all real estate is local – conditions vary greatly from one city to the next. Unfortunately, that news is largely unreported and can be misleading if looked at Nationally.
Here are the facts on three popular misperceptions in the real estate market:
Misperception: No one is buying a home, and home prices are falling rapidly.
Fact: According to the Illinois Association of REALTORS®, home sales are expected to reach about the same level that we saw in 2000, which was still a great year for real estate. Nationally, this year is projected to be the fifth best year on record for home sales. That means an approximate 5.5 million homes will be sold in this year alone.
Fact: While it’s true that the growth rate for Illinois median home prices is down slightly from last year, the median home price in Illinois has increased more than $40,000 since 2002. And, the Chicago metro area showed over a four percent price gain in the third quarter of 2007 compared to third quarter 2006. Again, each market varies. A significant share of metro areas in the state saw gains in the median price in the third quarter of 2007.
Misperception: Foreclosures and delinquencies are rising rapidly in every state.
Fact: According to RealtyTrac, Inc., three states – California, Florida and Nevada – are responsible for most of the increase in foreclosures in the third quarter. Illinois actually saw a 4.2 percent decrease in foreclosure filings in the third quarter compared to the second quarter of this year.
Fact: The reasons for foreclosures vary from state to state.
First-time homebuyers can take advantage of the new temporary tax credit signed into law on July 30, 2008, by President Bush as part of the Housing and Economic Recovery Act of 2008. Below are some of the parameters of the new program. Link to FAQs on the tax credit developed by the National Association of REALTORS® (NAR).
The tax credit is for 10 percent of the cost of the home, not to exceed $7,500.
It’s important to note the tax credit must be paid back over a period of 15 years like an interest-free loan. It’s available for any single-family residence (including condos) that will be used as a principal residence. The tax credit reduces income tax liability for the year of purchase. It can be claimed on tax return for that tax year.
There is an income requirement. To be eligible for the full credit, individuals must have an adjusted gross income of no more than $75,000 ($150,000 on a joint return). The tax credit is not available for individuals with incomes of $95,000 or higher ($170,000 on a joint return).
Applicants must be first-time homebuyers. (The buyer and the buyer’s spouse may not have owned a principal residence in three years previous to purchase.) The credit applies for purchases on or after April 9, 2008, and before July 1, 2009.
Learn more about the tax credit. Source: National Association of REALTORS®
The tax credit is for 10 percent of the cost of the home, not to exceed $7,500.
It’s important to note the tax credit must be paid back over a period of 15 years like an interest-free loan. It’s available for any single-family residence (including condos) that will be used as a principal residence. The tax credit reduces income tax liability for the year of purchase. It can be claimed on tax return for that tax year.
There is an income requirement. To be eligible for the full credit, individuals must have an adjusted gross income of no more than $75,000 ($150,000 on a joint return). The tax credit is not available for individuals with incomes of $95,000 or higher ($170,000 on a joint return).
Applicants must be first-time homebuyers. (The buyer and the buyer’s spouse may not have owned a principal residence in three years previous to purchase.) The credit applies for purchases on or after April 9, 2008, and before July 1, 2009.
Learn more about the tax credit. Source: National Association of REALTORS®
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