The other great option is for the buyers who are investors. Currently you are limited to a maximum of 4 financed properties including your primary residence. With this program, you can have up to 10 financed properties. I attached the matrix for these. If you own 4 or less financed properties, you can actually finance up to 90% of the price. No PMI either.

The attached matrix may be more technical than you may want or need to see but thought it could be of help as it goes into all aspects of this program.

Regarding rates, using an example of a purchase of a primary residence with a sales price of 200k with 5% down and a credit score of 675, the rate would be 5.125% for a 30 year fixed with no PMI. As you can see, very good. Currently, borrowers could not even get a conventional loan with less than 20% down and scores less than 720 due to not being able to get PMI.

For example, a 300k loan with 10% down, 4.75% interest rate for a 30 year fixed and a 740 credit score would normally have a payment of   $1565 for P&I plus PMI of about $190. This equals $1755.

If you use the lender paid PMI program, the rate would go to 5.25% but the payment is $1656 for P&I. However, there is no add on for PMI since it is built into the rate. This makes the payment lower by just under $100 per month.  You can do this with 5% down or 15% down as well. The 5% down loans would be .75% higher than the normal rate so 5.50% instead of 4.75% OR 15% down only increases the loan by .375%. It works best for relatively larger loans with smaller down payments such as 5 or 10% down since the PMI is much more expensive in these scenarios.

This is just one way of hopefully expanding the qualifications for potential buyers thus creating more opportunity for both your buyers and sellers.

Vote on Tax Credit Expected this Week
An amendment that would extend the first-time homebuyer tax credit has been incorporated into a Senate bill to prolong unemployment benefits. The amendment to the bill, introduced last Thursday by majority leader Sen. Harry Reid, D-Nev., would extend the tax credit to apply to homes under contract by May 1. Homebuyers would have to close by July 1 to claim a credit equal to 10 percent of the home’s purchase price, up to $8,000.
http://www.ncrealtors.org/news_display.cfm?nid=1104

Economists: Recovery to be Slow and Steady
A large majority of economists are now pointing to the recent stock market rally as a sign of sustainable recovery. Economists warn, however, that the recovery will be slow and many do not see home values bottoming out until the first half of 2010 or later.
http://www.usatoday.com/money/economy/2009-11-01-survey-recovery-economy_N.htm

NAR Praises Extension of Higher Loan Limits
The National Association of REALTORS® recently thanked Congress for speedy action in passing a congressional resolution late last week that would extend the current Fannie Mae, Freddie Mac, and FHA loan limits through 2010. President Obama signed the resolution shortly after it was passed by Congress.
http://www.realtor.org/RMODaily.nsf/pages/News2009103002?OpenDocument

Check the Link: http://www.usnews.com/money/blogs/the-home-front/2009/10/29/first-time-home-buyer-tax-credit-gets-obama-nod.html

http://money.cnn.com/2009/04/15/news/economy/

housing_market_index/index.htm?postversion=2009041513

Obama Launches Mortgage Rescue Plan
The Treasury Department announced last week the first six participants to sign up for President Obama’s loan modification program. They include three of the nation’s largest banks: JPMorgan Chase, Wells Fargo and Citigroup. The others are GMAC Mortgage, Saxon Mortgage Services and Select Portfolio Servicing.

http://money.cnn.com/2009/04/15/real_estate/

obama_mortgage_plan/index.htm?postversion=2009041610

After consulting one of my customers and a trusted CPA, we went over both the 2008 and 2009 tax credits. I have to qualify this as he was very clear that no one should give specific tax answers to an individual’s scenario unless you know all of the particulars and everything about their finances and deductions.

With that said, he gave me specific answers to general questions so here I go:

1) The difference between 2008 and 2009 tax credit:

There is a difference in the 2 at present not only in amounts but repayment.
2009 purchases do carry the $8000 credit which doesn’t have to be repaid if one lives in the house for at least 3 years.
If they move prior to the 3 years then it is supposed to be repaid and I believe that is handled at closing.
If the house was bought in 2008, the tax credit is $7500 and is to be paid back over 15 years, $500 one year at a time. It is basically an interest free loan for 15 years. If bought in 2009, the credit only has to be repaid if the house is sold within 3 years.

2) Who is eligible?

Yes it is for first time homebuyers and the definition of that is anyone who has not owned a house in the last 3 years.

3) Is it taxable?

The tax credit is not taxable but keep in mind that this doesn’t ensure a taxpayer gets 8k back. if a homebuyer owes $ for that year it will be essentially netted from the tax credit amount.

4) When does it get processed?

The tax credit will be issued only with a filed tax return and process along with any applicable refund. One loophole is that you can claim the 8k credit instead of the $7500 on the 2008 return even if you didn’t close until 2009 as long as your 2008 returns were not already filed. If you e-file your return and direct deposit, one will usually get the refund in less than 2 weeks.

Randy Pace or Matt Franklin are highly recommended CPAS who only take new clients on a referral basis and if you know someone who could use their assistance I am glad to refer you to either one. Please let me know if you’d like their contact information. I hope you find this useful and if I can be of further assistance please let me know.

Rob Sadoff, Executive Vice President
Omni Mortgage Corporation

Whose Loan Is Eligible for Modification Under the Obama Plan?
The Treasury Department recently released a report which includes eligibility requirements to determine which homeowners qualify for relief under the plan. Follow the link below for information on eligibility requirements as specified in the guidelines.
http://realtytimes.com/rtpages/20090317_loaneligible.htm

Homebuyer Tax Credit Website Attracts Record Number of Visitors
A record 844,000 prospective homebuyers visited the National Association of Home Builders’ FederalHousingTaxCredit.com Website in February to learn about the new $8,000 tax credit for first-time homebuyers that was enacted last month.
http://www.realtrends.com/go/view_media.php?mp_id=7862&cat_id=1282&PHPSESSID=
6fb4ab65a4073c1d3c2f8e4ca9676697

The House Charlotte program is a wonderful down payment assistance program that provides home buying education and financial assistance to prospective homebuyers. On average, buyers can expect to receive financial assistance of $7,500 and in certain cases, as much as $10,000 towards the purchase of a home.

Additionally, the program provides a special incentive to Police officers of up to $15,000 towards the purchase of a home.

The eligibility requirements of this generous program are as follows:

*
Families must have 110% or less of the local median income.
*
Participants must become certified by completing eight hours of pre-purchase homebuyer education.
*
The home must be the family’s primary residence (not investment property).
*
The home must be located in one of 87 designated neighborhoods throughout Charlotte.
*
The purchase price of the home cannot exceed $147,000.

Hope this helps. So at this point the $7500 credit (interest free loan) applies for qualified first time home buyers who purchased 4/9/08-12/31/08 and the $8000 credit (not to be paid back) qualified for 1/1-12/31/09 qualified buyer. …also make sure they know they have to stay there at least 36months. As I understand it the 15k credit was the preliminary talk in the house, but did not pass.