New Stimulus Package!

Yep.  I guess we will see how this pans out.  Hopefully people buy new things and not pay bills.  Well, that is what the government wants.

J.

I read an article this week that said in a recent survey, most people planned to pay off debt with their tax payment, not go out and buy new things. I am interested to see the details of the tax incentives for businesses. I'm hoping some of the incentives will benefit small businesses, which is what most of us in the real estate industry are.

I'm hoping also that any reforms to FHA loan limits and procedures will help to create stability in the real estate market. FHA backed loans looked sluggish and cumbersome next to the "any-goes" loans we saw over the past few years. I think the FHA missed out on an opportunity to develop good loan programs that provided realistic and safe alternatives for borrowers. They are trying to clean up the mess now; it remains to be seen how well they can do that.

My bet is that this package won't really stimulate the economy. It will just serve as insulation for folks who plan to hibernate during the upcoming perceived recession.

I don't know about you but I can spend the tax rebate in no time. The big news is the Fannie Mae and Freddie Mac loan limits going from $417,000 to $729,750. This will give more homeowners a chance to qualify for the many financing programs available on a refinance or purchase basis. Historically, borrowers who needed to borrow more than $417,000 were subject to the tougher underwriting standards of jumbo loans; this legislation will allow qualifed buyer/borrowers more buying power. With mortgage rates still low by historical standards and the real estate inventory at record highs, all the stars are lined up for buyers right now.  

Thanks for the posting! It's great news for a lot of people in need. Hopefully, the lucky ones that receive it will spend it to strengthen the enconomy!

Best wishes to you in 2008!

Joyce Logan, Realtor, Westerville, Ohio

I just found out from my husband/accountant that the payment sent to taxpayers will be taxable income, so they will need to pay taxes on it in the next tax year. This was apparently the case when the last payment for families with children was sent out a couple of years ago. I was unaware of the "taxbale income" issue, as I wasn't eligible for that payment. According to my husband, many tax preparers were unaware of it as well, and lots of tax returns were prepared incorrectly in the year following the payment. This is just a little piece of information you can give your clients, to let them know you are on the ball and looking out for them:).