Sounds like there is a chance credit may be still be available after November.....
SAN DIEGO (MarketWatch) -- The expansion -- or, at a minimum, extension -- of the $8,000 first-time-home-buyer tax credit that is set to expire Nov. 30 is at the top of the legislative agenda for the Mortgage Bankers Association, with one of the MBA's leaders saying the trade group is "very close" to winning that battle in Congress.
"We are pushing for expansion of the tax credit, and we are very close to winning this one," said David Kittle, MBA's outgoing chairman.
The tax credit has been credited with boosting home sales, and mortgage applications, as first-time buyers came out in force this summer.
"Hundreds of thousands of home buyers have come off the sidelines because of the credit, and if we lose it we risk losing the stability that is creeping backing into the housing market and the economy overall," said Robert Story Jr., a Seattle mortgage banker and the incoming chairman of the MBA, which opened its annual convention here Monday.
Political analyst Paul Begala, an adviser in the Clinton administration, predicted the credit would be extended, in part because of a feeling among a lot of the American people that they have gotten little out of the financial bailout that kept large institutions afloat.
"People have seen the bailout of the executives who caused these problems ... while the mom-and-pop operator is left to fend for themselves ... and that grates on people," Begala told the convention's opening session. "There is a lot of anger out there still over that."
It's not clear what form legislation to extend the tax credit would take; at least 20 bills have been drafted in Congress regarding the credit. Some proposals would not only extend the first-time-buyer credit into next year but would expand it to include all buyers, remove income restrictions and raise the maximum value of the credit as high as $15,000.
For those who purchase a home this year, the tax credit is for 10% of the purchase price, up to $8,000. Those who have owned a home in the past three years aren't eligible. Buyers also have to meet eligibility requirements regarding income; the current credit begins to phase out for singles who make more than $75,000 and couples who make more than $150,000.
An extension on the tax credit would be a major victory for the housing industry -- the National Association of Realtors and National Association of Home Builders are also lobbying strongly for the move -- but would be of particular significance to mortgage bankers, who have taken it on the chin in the last two years as loan delinquencies and foreclosures swelled and regulators proposed thousands of pages of new rules to rein in an industry that many blame for helping create the financial crisis.
John Courson, CEO of the Mortgage Bankers Association, likened his industry's plight to that of Bugs Bunny being chased by Elmer Fudd. "There have been a lot of Elmer Fudds firing shotgun blasts our way -- regulators, legislators, media, consumer advocates -- in the last year.
Mortgage applicants confront an array of paperwork throughout the loan process. Making the process more transparent is one goal of federal proposals. 'Regulate us, sure,' says a mortagage-industry leader, 'but don’t stop us from having the ability to make the best loans for borrowers.'
"Our goal is to renew the faith and restore the confidence in our industry and we've gone a long way down that path this year."
The mortgage bankers have made three major legislative proposals, trying to stay ahead of the financial regulatory reform they know is coming in the wake of the global meltdown that started in 2008. They have suggested their own set of reforms in a Mortgage Improvement and Regulatory Act, set out a new framework for the secondary mortgage market and come up with ideas for adding liquidity to the hard-hit warehouse lending business.
"And we've done a darn good job of working with borrowers, with the odds stacked against us, to keep 2 million homeowners in their homes this year," he said.
But major challenges lie ahead. New rules governing the Real Estate Settlement and Procedures Act are set to go into effect Jan. 1, and many mortgage bankers here are complaining that those rules, particularly modifications to the good-faith estimates that mortgage providers are required to prepare for borrowers, will complicate life for consumers and force up the cost of loans.
The Federal Reserve is also soliciting comments on nearly 1,400 pages of regulations that update the Truth in Lending Act, with provisions that clamp down on compensation arrangements for loan originators and tighten disclosure requirements for consumers.
"Regulation is coming," said David Kittle, outgoing chairman of the MBA. "Regulate us, sure, but don't stop us from having the ability to make the best loans for borrowers."
Steve Kerch is assistant managing editor and personal finance editor of MarketWatch in Chicago.
New short foreclosure alternatives were released today. Here is a summary...
The Obama Administration has added new incentives and standard procedures for short sales 5/14/2009. This is through the new Foreclosure Alternatives Program (FAP), part of the Making Homes Affordable plan.
If your home loan isn't eligible to be modified on a permanent basis loan servicers may consider short sales or deeds-in-lieu of foreclosure instead.
Borrowers must meet minimum eligibility requirements for the Home Affordable Modification program, but don't actually qualify for a modification. Before foreclosing, servicers must determine if a short sale is appropriate.
Incentives given include... $1,000 for servicers completion of a short sale or deed-in-lieu of foreclosure, $1,500 for borrowers to help with relocation expenses, and as much as $1,000 toward the cost of paying second lien holders to release their liens
The program will include standardized documents, including a Short Sale Agreement and an acceptance letter.
The price servicers place on the property value may be determined based on an appraisal or broker price opinions issued within a certain time frame.
In the Short Sale Agreement, servicers must give homeowners minimum 90 days to try to sell their property, or as much as a year, depending on conditions for that area. Property must be listed with a licensed real estate professional. Foreclosure can not take place during the minimum 90 day marketing.
Good point for realtors... Servicers will not be able to negotiate lower commissions after an offer has been received. And a good point for homeowners servicers can not charge fees for participating in the foreclosure alternative program which will last through 2012.
Servicers do have the ability to require homeowner to deed the property to the servicer in exchange for a release from the debt if the property does not sell within the time allowed in the Short Sale Agreement
Hopefully these programs will give those in trouble more means to recover.
Well here goes are favorite economists with their words of wisdom.. this time home prices are undervalued, but likely to fall further. Hmmn maybe they aren't really undervauled then?? Oh well lets give them their paychecks for the week and wait until their next notice.
ECONOMIC REPORT
U.S. homes now undervalued, economists say
Prices fall in 241 metro areas in third quarter, and are likely to fall further
By Rex Nutting, MarketWatch
Last update: 11:47 a.m. EST Dec. 3, 2008Comments: 117WASHINGTON (MarketWatch) - The U.S. housing market is now slightly undervalued after rapid price declines have overshot fundamentals, economists for IHS Global Insight said Wednesday.
House prices fell at a 6.9% annual pace nationwide in the third quarter, with prices falling in 241 of 330 metropolitan areas. Prices are down 6.5% from their peak in 2007.
Compared with their long-term fundamental values, U.S. homes are now 3.8% undervalued, the economists said.
"With no end in sight to the downward spiral of house prices, it is likely that the long-anticipated market correction will now overshoot fundamental valuations on the downside," said James Diffley, head of regional economics at Global Insight.
"Weak economic conditions and wary consumers continue to hold the housing market back," said Jeannine Cataldi, senior economist in charge of Global Insight's regional real estate analysis. "Although many areas are seeing home sales increase, it is largely due to foreclosure homes being snapped up at significantly discounted prices. As the inventory of these homes is removed from the market, prices will remain on a downward path."
However, another economist said home prices are still too high in many bubble areas.
"Prices in many markets are still hugely out of line with trend levels, as measured by price-to-rent ratios," said Dean Baker, co-director of the Center for Economic and Policy Research. "As long as house prices remain inflated, there is no way that the market can stabilize since there will continue to be a large excess supply of housing putting downward pressure on house prices."
Baker suggested that the government order Fannie Mae (FNM:Fannie Mae
Last: 0.77-0.05-5.90% FNM 0.77, -0.05, -5.9%) and Freddie Mac (FRE:Freddie Mac
Last: 0.78+0.01+1.30% to refuse to buy mortgages in areas where prices are still out of line, thus forcing prices to correct quickly. Capital should flow to cities with fairly valued homes, Baker said.
The quarterly report from Global Insight and National City Bank compares observed home prices with fundamental values based on differences in population density, relative income levels, interest rates, and historically observed market premiums or discounts.
According to the Global Insight report, only three metro areas are extremely overvalued: Atlantic City, N.J., Bend, Ore., and St. George, Utah. In 2005, 52 metro areas were deemed to be extremely overvalued.
Home prices fell more than 10% in nine metro areas in central California during the third quarter, Global Insight said. Prices in Merced, Stockton and Modesto are down more than 50% from their peak, while 26 other cities in California, Nevada and Florida are down more than 30%, they said.
For a pdf version of the new loan limits for 2009 click on the link below. If you live in an area where current rates are higher, you may want to look at buying or refinancing now.
Here is the summary of how the new rates were calculated.
Fannie Mae and Freddie Mac conforming loan limits for the high cost areas below may not exceed the corresponding levels listed. These loan limits apply to
loans purchased between January 1, 2009 and December 31, 2009. For a one-unit property, the maximum loan limit is calculated as 1.15 times the median
house price for the highest priced county in the property's metropolitan or micropolitan area or the median house price for the property's county if it is in a
rural county. Regardless of the area median home price, the loan limit cannot, in general, exceed $625,500 (1.50 times the 2009 conforming loan limit). The
exceptions are properties in Alaska, Hawaii, Guam, and the Virgin Islands, where that range is 50 percent higher ($625,500 to $938,250). The 2009
conforming loan limit of $417,000 is in place everywhere else. Loan limits for 2-4 unit properties are proportional to the 1-unit limits.
How old were you when you stopped trick or treating? I kind of hate to admit, but last went in college. Kind of a spur of the moment thing. Several guys in the dorm had gone to a thrift store and bought old clothes and ties and were dressing up as used cars salesmen. I didn't want to be left out, but didn't have a costume. One of the guys was an engineering major and had lots of blueprints, so it was decided that we would tape the blueprints all over me including a blueprint cape. We also had a paper mask of a sea captain. What was I you ask?? Captain Blueprint of course. As we headed off in search of candy the rest of the dorm laughed at us. Growing up in a neighborhood where we used to go to about 5 houses and got about as many kids at our place, the big city thing was amazing. We filled up pillow cases with candy very quickly, and yes every house asked me what/who was I? With a couple of us being over 6 feet tall we got a lot of other comments too, like "ok guys do you think you are a little old??" When we got back to the dorms and everyone saw our loot, nobody was laughing any more. We were generous though and emptied it out for everyone. Even though I was a little on the old side, it completed Halloween for me in terms of trick or treating like you see in the movies with tons of homes and lots of kids running everywhere. I wish I had a picture of Captain Blueprint, but to my knowledge none exist.
We will manage your property to its full potential, saving you both time and money.
We pro actively manage properties to achieve maximum value for our property investors.
Property Management Through our management plan we will:
* Advertise * Obtain qualified tenants * Collect Rents * Handle any repair problems (see my own home remodel photos) * Monthly statements and year end 1099 statements * Property inspections
and so much more...
For complete details and a free property analysis please call us at
800-688-5875 (ext 0)
Glen and Kristi Mitchell Team
Real Estate Broker Licensed in California and Hawaii
Serving the following San Mateo County areas....
San Mateo, Half Moon Bay, El Granada, Moss Beach, Montara, Pacifica, Daly City, San Bruno, San Carlos, South San Francisco, Belmont, Stanford, Hillsborough, Redwood City, Atherton, Brisbane, Colma, Foster City, Menlo Park, Millbrae, Portola Valley, Woodside, and Pescadero
So even with housing prices coming down, loans are harder to get, and you still haven't saved up for the down payment, is there really a way to get in for less?? Some how??
Well, what about buying stock in a manufactured home building company. Like many other builder stocks prices have come way down. As of today you can get into Champion Homes for $1.61 a share or Fleetwood for only .27 cents a share. A fraction of the price of Palm Harbor which closed at $6.31 a share and miles behind Cavco at $30.34 a share.
Who would invest in manufactured home companies you ask? Well, a few years back Warren Buffett's Berkshire Hathaway purchased Clayton Homes. Warren did lose a few billion last week, but over the years he's made investments in industries that hold strong and make a profit.
In the case of Fleetwood and Champion they both trade below their book value. Once again maybe not the strongest argument as many stocks probably do these days.
So here's the plan for about $1000 you buy a few thousand shares of Fleetwood. Stock goes to $10 and you are up $30k and in the bottom price range for a Fleetwood home.(some final assembly required with the set up) You don't have to worry about the price going much lower. Most you can lose is the $1000. You don't have to worry about a loan and when you sell you're paying cash for your new home so no worries down the road either. What you do need to do of course is buy that manufactured home through me as a thank you for getting you into the housing market for under $2.
I should ad this post is just for fun and you need to talk to a financial advisor before buying any of the stocks mentioned here. There is a risk of loss in the stock market :) Just look below as anyone who recently bought Champion at $12 could tell you so.
Disclaimer: ActiveRain Corp. does not necessarily endorse the real estate agents, loan officers and brokers listed on this site. These real estate profiles, blogs and blog entries are provided here as a courtesy to our visitors to help them make an informed decision when buying or selling a house. ActiveRain Corp. takes no responsibility for the content in these profiles, that are written by the members of this community.
;)
;)
