Frustration Over Housing Bailout??

Obama's Recovery Housing Bill is full of help, or not???
To help you siphon through the legal jargon of the housing recovery aspects of the bill, I thought as a realtor, I would try to spell out exactly what that means for the home buyers or homeowners. Please let me know if you feel powerless or are you still confused over what you get out of this bill or if it hurts the responsible who lived within their means? 

38% or MORE ON YOUR MORTGAGE

Get out your IRS tax statements or your W2's and take a pen to paper. To qualify for a benefit to lower your monthly payments, the bills requires that you have to be spending at least 38% of your monthly income on your mortgage. Makes you wonder if homeowners who become desperate will quit their jobs so they can qualify. I guess, that would work, as long as their spouse has a job. I mean this could make a difference if you walk. Now this doesn't apply to second homes or investment homes.

The way this works is you and me and your mortgage lender will help divvy up the costs of lowering your payments to 31% of your income. Can you imagine....that means you could have an interest rates as low as 2%. Or you may get the principal reduced. Plus, if you pay your mortgage on time, US taxpayers will pay off as much as $1,000 of your loan each year for five years. If you happen to have a mortgage payment less than 38% of their income - you my friend are out of luck.

REVERSE MORTGAGE LIMITS RAISED

If you are trying to help your parents or any senior citizen feeling the pinch , you may want to explore the reverse mortgage option, The limits for reverse mortgages backed by the Federal Housing Administration have been raised to $625,000 from $417,000.

HOUSING COLLAPSE WIPED OUT EQUITY

There maybe help for you. If you have been paying your mortgage, but because of the refi market and housing collapse that has wiped out your equity, you may benefit from the new refi assistance. So, the qualifications for the government to help you refinance your mortgage is: if you owe between 80% and 105% of your home's value. The downside is: this will only help those with mortgages owned by Fannie Mae or Freddie Mac get cut in. And it excludes many homeowners in Florida, Nevada, Arizona and California. This really stinks.

$8,000 TAX CREDIT or Really?

This one is an eyeopener or another government tease. You know how the government has been flirting with the $8000 tax credit for new home buyers, well the truth is: Anyone who hasn't owned a home for at least three years is entitled to a helpful tax credit, for up to 10% of the cost, up to $8,000, Did you get that: UP TO 10%. So for many of you who thought you would be getting the $8,000 tax credtit be careful and read the small print. And of course, you have to buy a home this year.
The good parts is it is a refundable credit - so if you don't pay $8,000 in taxes, or indeed any taxes at all, you get the rest as a check. Now, if you make a high income-you again are out of luck - the credit phases out above a modified adjusted gross income of $75,000 for one person.

CONFORMING LOAN LIMITS RAISED

The government just raised the "conforming loan" limits to $729,750 from $625,500, yea for those that can buy those expensive properties AND can qualify.



Now, I am not a mortgage banker or lender, just doing my homework. However, please comment, if you have additional information to the consumers that could help alleviate any concerns.