Washington has been busy lately. In one of the most rapidly approved bills in memory, the Housing and Economic Recovery Act was passed into law, and could have significant implications on the housing and mortgage industry. While there is a lot to share with you, I wanted to reach out to let you know a few things that could impact you or someone you know right away.
The first thing that stands to impact many homebuyers is the elimination of what is known as seller down payment assistance for FHA loans. Seller down payment assistance is where a home seller contributes money to a down payment assistance company who in turn provides a legal grant to the homebuyer. This has helped over 900,000 families obtain homeownership since 2000.
However, as the legislation is written, this will be eliminated for homebuyers effective October 1. There is currently some discussion as to when the hard date will be in effect, as to whether someone who is in process of buying a home will need to have their loan application in process.
That said, if you or someone you know needs the ability to implement down payment assistance as a tool to buy a home, get on it quickly. The clock is ticking.
The other really interesting piece that was included in this legislation is that for first time homebuyers, they have a window to qualify for up to a $7,500 tax credit. The tax credit will be 10% of the purchase price of a home, up to a maximum of the full $7500 credit. The tax credit will have to be paid back over a period of 15 years...but Washington just provided first time homebuyers a 15-year interest free loan to help them buy a home! There are other qualifying factors here, but I will save them for anyone that would like to know more.
The bill is 789 pages long and you can expect that I will be passing along other pertinent information as to how it may impact you. Or if you prefer, pick up the phone and give me a call. There is a lot that is being said in the media and I want to make sure you get all the information that could help you.
Michael Reeve, CMPS®
Vice President
The First Bexley Bank
614-237-2006 x129 direct
mreeve@firstbexleybank.com
Comments(0)