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On March 4th, The Obama Administration announced new U.S. Department of the Treasury guidelines to enable servicers to begin modifications of eligible mortgages under the Administration's Homeowner Affordability and Stability Plan – announced by President Barack Obama just two weeks ago. The release of detailed requirements for the "Making Home Affordable" program facilitates implementation of the critical provisions that will help bring relief to responsible homeowners struggling to make their mortgage payments, while preventing neighborhoods and communities from suffering the negative spillover effects of foreclosure such as lower housing prices, increased crime and higher taxes.

Making Home Affordable will offer assistance to as many as 7 to 9 million homeowners, making their mortgages more affordable and helping to prevent the destructive impact of foreclosures on families, communities and the national economy.

The Home Affordable Refinance program will be available to 4 to 5 million homeowners who have a solid payment history on an existing mortgage owned by Fannie Mae or Freddie Mac. Normally, these borrowers would be unable to refinance because their homes have lost value, pushing their current loan-to-value ratios above 80%. Under the Home Affordable Refinance program, many of them will now be eligible to refinance their loan to take advantage of today's lower mortgage rates or to refinance an adjustable-rate mortgage into a more stable mortgage, such as a 30-year fixed rate loan.

GSE lenders and servicers already have much of the borrower's information on file, so documentation requirements are not likely to be burdensome. In addition, in some cases an appraisal will not be necessary. This flexibility will make the refinance quicker and less costly for both borrowers and lenders. The Home Affordable Refinance program ends in June 2010.

The Home Affordable Modification program will help up to 3 to 4 million at-risk homeowners avoid foreclosure by reducing monthly mortgage payments. Working with the banking and credit union regulators, the FHA, the VA, the USDA and the Federal Housing Finance Agency, the Treasury Department today announced program guidelines that are expected to become standard industry practice in pursuing affordable and sustainable mortgage modifications. This program will work in tandem with an expanded and improved Hope for Homeowners program.

With the information now available, servicers can begin immediately to modify eligible mortgages under the Modification program so that at-risk borrowers can better afford their payments.

Read more at http://www.Financialstability.gov

Summary of Guidelines

Modification Program Guidelines

IRS Forms available here to claim the First-Time Homebuyer Tax Credit, plus additional information on eligibility, amounts and repayment criteria.

Also FHA just announced increase in the FHA mortgage limties to $365,000 for the metro counties only.  We have a complete list of the limits fo the other counties in the state and their limits.

Many have already heard of the $7500 tax credit for first time buyers. With the new administration comes a new economic stimulus package. Part of which includes an enhanced first time home buyer tax credit.

The bill is currently working through congress already passed by the House and the final Senate vote is expected this evening. The bill will probably be on Obama’s desk on Monday, Presidents Day.

Some of the new provisions for the first time home buyer tax credit are outline below:

• Tax credit will be 10% of home value up to $80,000
• No payback
• Must be repaid if residence sells with 3yrs
• Property purchased by first time buyer must be primary residence
• Property must be purchase between January 1 and September 1, 2009
• Income eligibility phase out begins for couples at $150,000 and for a single person at $75,000

Once the stimulus package if fully approved the website will be updated with additional information for the enhanced first time home buyer tax credit.

With the historic event of the inauguration of Barack Obama and Joe Biden there is much speculation on how the new administration plans to strengthen the economy and how this change will impact the mortgage industry.

With the worse inauguration stock selloff in history, Barack Obama’s administration may need to initially work on jumpstarting the economy before turning their focus to the mortgage industry.

The general consensus in the mortgage industry regarding this new administration is that the government will try and keep mortgage rates low by offering more government programs since Fannie Mae and Freddie Mac are under the US Government’s control.

We are hopeful that with continued low interest rates and more mortgage programs likely to be made available the home values will begin to rise because of an increase in demand.

As President Obama addressed the nation and world on Tuesday, the challenges we face are real, serious and many. They may not be easily met or in a short time span.

With optimism we look forward to 2009 being a year of shift in the real estate industry, while protecting homeownership and cracking down on mortgage fraud.

You’ve probably seen the commercials-you know the ones with the catchy band playing in a seafood restaurant dressed up as pirates, or in the parent’s basement or at the renaissance fair.  Hopefully by now you’re thinking “free credit report.” 

Many people don’t even think about their credit score until they need to utilize it for financing. It is best to take preventative action in the security of your identity by reviewing your credit annually.

Just the other day I had a client in to discuss the possibly of refinancing their loan. While reviewing the credit report one of the accounts just didn’t seem right. The next day my client stopped by to thank me, it turns out his identity was stolen, and some credit cards were maxed out. Additional accounts were already opened by the thief but no charges were posted to them yet. My client was able to cancel the cards with a zero balance and have his credit file flagged for fraud.

Basically the fraud alert is attached to the credit report through the three major credit bureaus, Equifax, Experian and TransUnion. With the fraud alert, there are extra precautions in regards to a credit account being opened in your name, such as a credit card, car loan, cell phone or store credit cards.

Identity theft and fraud is not just limited to adults- minors can have their identity stolen as well. Since the reporting agencies don’t normally maintain credit files for minors, the process of reporting suspected fraudulent activity is a bit more documented, you may also want to inform law enforcement as well.

Be an aware consumer and put the safeguards in place to keep your identity yours.

For more information on the First Time Home Buyer Tax Credit, make sure to access our “FREE Report-First Time Home Buyer Tax Credit” recently added to our website. We hope you find the power point presentation to be useful and informative.

Don’t miss out on this $7,500 tax credit opportunity if you are a first time home buyer!

If you have any questions about the First Time Home Buyer Tax Credit or any of the additional provisions of HR 3221 “Housing and Economic Recovery Act of 2008” signed into law on July 30, 2008 by President Bush, please contact us.

We continually monitor the mortgage industry including any legislative changes or upcoming proposals that will impact you and strive to present the information in a way that clearly shows you your opportunities while achieving your financial goals.

HR 3221 “Housing and Economic Recovery Act of 2008” was signed into law on July 30, 2008 by President Bush, as a plan to help homeowners avoid foreclosure and to boost the housing market. The provisions in the large bill may be interpreted in different ways; resulting in potential conflicting information internet as well as in print media.

We’ll be updating our website with information regarding the implementation of these changes as well as offering Free Reports which will list out the details of these provisions.

Some of the key provisions with an overview of the highlights are provided below:

First Time Home Buyer Tax Credit

· First Time Home Buyer is a person who (or a couple where either individual) has not owned a principle residence for a three year period prior to the purchase.

· Homes purchased on or after April 9, 2008 and before July 1, 2009

· Maximum credit is $7,500

· Qualifying for the full tax credit: single taxpayers with incomes up to $75,000 and married couples with incomes up to $150,000.

· Individuals and married couples with incomes over the listed amount may be eligible for a partial tax credit.

· The tax credit will be repaid interest free over a 15 year period; if the full tax credit is given the annual payment amount will be $500. Please contact us if you need a referral for tax professional to determine what this means if you qualify.

FHA Modernization

· The minimum down payment required for an FHA purchase is currently 3% which will be increased to 3.5%.

· The bill removes seller funded down payment assistance (DPA) programs as of September 30, 2008. HR 6694 was introduced by several members of Congress on July 31^st, 2008 which if signed into law would allow DPA to continue.

Hope for Homeowners Plan

· Help borrowers avoid foreclosure by allowing them to refinance into a lower-cost government insured mortgage they can repay.

· Up to $300 billion will be allowed by Congress for FHA to guarantee these new mortgages if lenders voluntarily agreed to adjust the terms and outstanding principal.

· While the lenders will be assuming a substantial loss to lower the loan principal, the borrowers must agree to share any profit form the resale of a refinanced home with the government to utilize the FHA guarantee.

· $180 million is also provide for legal assistance and financial counseling to help families stay in their current home.