Now more than ever the FHA loan is the best loan out there for many reasons
Homeowners enjoy the benefits of investing in their property year after year. For some, there comes a time when that investment can come in handy. Refinancing with an FHA loan can prove to be an effective way to put that equity to work.
Sending a child to college, consolidating bills, taking a much needed vacation, or making home improvements are some of the ways homeowners tap into the equity they have accumulated in their home to help with these expenses. Keep in mind that FHA refinancing is only available to homeowners who are currently using their home as their principal residence.
FHA Refinance Questions You Should Be Ready To Answer
When you decide to apply for an FHA refinance loan, there are several questions you’ll need to answer to set the approval process in motion. Some questions are about planning issues, others are directly related to whether or not an FHA refinance loan is for you.
WHAT KIND OF FHA REFINANCING DO I NEED?
If you have a conventional home loan, an FHA refinancing mortgage is the product for you. If your home loan is an FHA mortgage, you can apply for an FHA Streamline mortgage. These FHA loans are much faster and easier to apply for since you are already in the FHA loan system. You don’t need to go shopping for a conventional home mortgage refinancing package if you qualify for an FHA Streamline loan.
IS MY LENDER WILLING TO HELP ME REFINANCE OR SHOULD I SHOP AROUND?
FHA refinancing loans are offered by participating lenders—they aren’t available at every bank. If your loan officer says your current bank doesn’t want to pursue FHA refinancing options in your case, shop around for a participating lender who can help.
HAVE I EVER FILED FOR BANKRUPTCY?
If you have filed for bankruptcy, don’t assume you can’t be approved for an FHA refinancing loan or an FHA Streamline loan. While filing for Chapter 7 or Chapter 13 bankruptcy doesn’t look good on a credit report, in many cases if you have made your payments on time and have lived up to the terms of your bankruptcy agreement, an FHA refinancing loan may still be possible. Never assume your case is hopeless. Make your payments on time, stay current, and talk to your loan officer about your specific circumstances. You might be surprised at what you learn.
WHAT IS MY CREDIT SCORE?
When applying for an FHA refinance mortgage, some lenders will ask you to rate your own credit, while others may simply do a credit check. If you have bad credit, you aren’t automatically disqualified from an FHA refinance loan. FHA mortgages are intended to help people get into and keep their homes; if you have been making on-time payments and your overall pattern of credit shows you’ve been diligent, you can still be considered for a refinancing loan through the FHA. Those who fell on hard times when the economy grew bad may find a second chance thanks to an FHA mortgage refinancing package. Don’t assume you shouldn’t apply—let your loan officer work with you to determine the best way to proceed.
HOW MUCH OF MY INCOME GOES TOWARD MY CURRENT MORTGAGE?
The amount of your current income and the amount you pay for your existing mortgage are very important. Be ready with exact figures and don’t forget to include any extra income you might be bringing in from a part-time job or your spouse’s income.
WHAT KIND OF PROPERTY DO I OWN?
One requirement for an FHA refinance loan is that you occupy the property you are refinancing. This requirement isn’t an issue when you take out a typical mortgage on a property, but once you begin applying for FHA loans and refinance loans, you’ll find the occupancy requirement is a key issue. In some case you may be able to get refinancing on a multiple-occupant home such as a duplex or condominium; these instances are covered by rules specific to each FHA refinancing program.
There are many differences between FHA Streamline refinancing and refinancing from a non-FHA mortgage into an FHA loan. Streamline loans, for example, may not require a new appraisal while an FAH refinance loan on a property purchased with a conventional mortgage may require a re-appraisal in some cases. Ask your lender about your specific needs.
As a mortgage professional I deal with HVCC and how it pertains my industry every day. We adapt to the ever changing world of real estate all the time….However what about the first time home buyer, what about the family who desperpartly needs to consolidate debt, what about the family who was suckered into to a variable rate by some fast talking former used car salesman..What about the family that needs to sell their home and buy a bigger or smaller home….What about those people…Well those people are hearing ”NO WE CANT HELP YOU” every day from professionals they have given the trust of the biggest investment of their life!!
Well in today’s blog I would like to educate you help you to understand a little bit about HVCC what it is and how it affects you!
After an investigation by New York Attorney General, Andrew Cuomo into Fannie Mae and Freddie Mac Appraisal practices, the agencies (with the Office of Federal Housing Enterprise Oversight (OFHEO)) agreed adopt new changes to how appraisals are processed in the mortgage industry in exchange for an end to the investigation. The centerpiece of the agreement is the HVCC, which contains many positive and common sense initiatives to help clean up the industry, but also contains significant negative changes to the how brokers and agents are able to work with appraisers and how appraisers are able to operate, hurting consumers, mortgage brokers, agents, and appraisers.
Here is the break down….
Brokers (or anybody compensated on a commission basis upon the successful completion of a loan) may not choose appraisers to be used for loans they originate and may not engage in any communication with appraisers. Choosing appraisers and all communication with appraisers is delegated to lenders. This means that brokers are not only not allowed to choose appraisers based on quality of work and professionalism, but ultimately lose control of an integral part of the loan origination process, possibly increasing loan funding times and increasing costs to the consumers in the form of longer rate locks and the need to order new appraisals if there is a change of lender.
2. Since appraisals are made in the lender’s name and not the broker’s, if the broker chooses a new lender for the deal, a completely new appraisal will need to be ordered. This increased consumer costs and the time involved in the transaction.
3. All relationships with appraisers are rendered meaningless overnight.
4. Brokers lose control over transactions and are put at disadvantage as power is shifted toward and biased towards large institutions.
What it means to Appraisers:
1. Must use AMC’s (appraisal management companies), meaning independent appraisers are forced to join and AMC and give 40% or more of their income to the AMC. You read that correctly, this will deprive independent appraisers of nearly 50% of their income in most cases (this could likely mean many experienced appraisers will leave the industry altogether). AMC’s are not regulated, by the way.
2. Unfairly targets appraisers, does not affect AVM’s (Automated Valuation Models) and BPO’s (Broker Price Opinions). This not only hurts appraisers as Lenders may prefer unregulated and unrestricted alternatives that are not included in the HVCC and in a manner which is in contrast with the stated purpose of HVCC.
3. Disallows appraisers from engaging in ANY communication with mortgage brokers, loan officers, agents, or others that may receive a commission upon funding of a deal. This means appraisers are not allowed to talk to their clients, a restriction no placed on any other industry to date. This means all the client relationships they have built are rendered meaningless overnight, an unprecedented act against any industry segment to date.
What it means to Consumers:
1. Higher Costs: If there is a need to change lenders or brokers as a new appraisal will be necessary.
2. Increased time to fund loans as brokers lose control of choosing and managing appraisals and may necessitate longer rate locks or extensions of existing locks. In the case that a new lender or broker is chosen, a new appraisal will be necessitated, increasing time to funding.
3. Decrease incentive to change lenders or brokers if they are not getting the service they deserve due to increased costs and time involved…….
YOU CAN STOP THIS…LET YOUR ELECTED OFFICALS KNOW THAT THIS AFFECTS YOUR LIFE IN NEGITIVE WAY….
Don’t get me wrong I believe improvement was needed however done this way hurts everybody!!!
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Fewer homeowners falling behind on mortgage payments…..
The delinquency rate for mortgage loans on one- to four-unit residential properties fell to a seasonally adjusted rate of 9.47% of all loans at the end of the fourth quarter of 2009, according to the Mortgage Bankers Assn. That’s down from 9.64% in the third quarter.
It’s extremely rare for the delinquency rate to decline at the end of the year, when homeowners are grappling with the cost of heating and Christmas presents, according to the trade group.
“We are likely seeing the beginning of the end of the unprecedented wave of mortgage delinquencies and foreclosures that started with the subprime defaults in early 2007 [and] continued with the meltdown of the housing markets due to overbuilding and the weak loan underwriting that supported that overbuilding,” Jay Brinkmann, the group’s chief economist, said in a statement.
However, the data still pointed to a troubled housing market that is likely to worsen before it improves.
The delinquency rate was up from 7.88% a year earlier.%.
“This is a key sign that housing market conditions are slowly, grudgingly getting slightly better,”
In a sign that delinquencies may be leveling off, the number of loans past due by 30 days and 60 days declined compared with the third quarter of 2009 and the fourth quarter of 2008.
The number of loans going into foreclosure, though up from a year earlier, declined compared with the third quarter as efforts to modify mortgages took hold.
But the portfolio of loans more than 90 days past due — containing mortgages being evaluated for modifications — continued its rise to record levels.
That indicates that there is still much short-term pain for the housing markets to endure as many homes fall into foreclosure.
4.99% of all prime fixed-rate loans, the kind made to the best-qualified borrowers, were categorized as seriously delinquent (that is, in foreclosure or more than 90 days past due), up from 2.25% a year earlier.
For prime adjustable-rate loans, the category containing tricky pay-option mortgages, 18.13% were seriously delinquent, compared with 10.45% a year earlier.
And 42.7% of subprime adjustable loans were seriously delinquent, up from 33.78% in the fourth quarter of 2008.
The mortgage trends mirror those in the job market, where the number of long-term unemployed remains high while new jobless claims have been declining.
Everyday I sit down with clients and I review the paperwork with them. I always get asked the same question. So today I thought I would unpack APR…What is APR…and answer the question.Why is the APR so much higher than the rate?
The APR is a mathematical calculation of the cost of financing . . . basically, the interest, the prepaid charges, the mortgage insurance, etc. . . . all the things that you pay as a borrower that someone who had their own cash for the transaction would not.
For those of you not interested in long and complicated, here is a very serviceable and very brief defiinition: APR is the true cost of money over time.
In other words, your mortgage has a note rate, or the interest rate on your loan, but it also has closing costs, prepaid interest, and other finance charges. The APR is the cost of your normal interest and those finance charges over time expressed as an interest rate relative to the rate you are paying on your mortgage.
It is intended to level the playing field among mortgage quotes. For instance, one loan might advertise a 4.5% NOTE rate, while another advertises 6.5% rate. But both of those loan’s APRs could be exactly the same, meaning that although the 4.5% loan appears to be the better deal, if you take closing costs and finance charges into consideration, the cost is actually the same as the 6.5% loan. In fact, if you were to sell or refinance the house sooner rather than later, you’d probably pay less interest overall on the 6.5% loan!
The APR can be higher than the nominal interest rate of a loan for a variety of reasons. To understand why though, it is helpful to first understand what is APR and how it is calculated.
APR, otherwise known as the Annual Percentage Rate, is the corresponding percentage rate reflecting the cost of financing. Its purpose is to provide a single measure to help consumers compare mortgage terms. It is disclosed on the Truth-In-Lending Disclosure Statement which describes APR as “the cost of your credit as a yearly rate”.
For purposes of the APR calculation, items defined as prepaid finance charges are deducted from the loan amount. The Annual Percentage Rate is calculated by amotizing this reduced amount over the course of the loan’s amortization period. The rationale behind this is that you are not getting the full benefit of the whole loan amount since you are being charged costs to obtain that financing.
It is important to note that not all closing costs are treated as Prepaid Finance Charges so the APR is not a true reflection of all of the costs for obtaining a home loan. In addition, the rules that govern what is treated as a PFC under the Federal Truth-In-Lending Act (Regulation Z) are complex and subject to interpretation such that not all lenders treat the same items as a Prepaid Finance Charge. This in turn can lead to discrepancies when comparing APRs among lenders.
Items typically treated as Prepaid Finance Charges are :
Application Fee
Assignment Fee
Assumption Fee
Commitment Fee
Courier Fee
Escrow Waiver Fee
Flood Certificate
Funding Fee
Lender Inspection Fee
Loan Origination/Discount Fee(“points”)
Mortgage Broker Fee
Mortgage Insurance
Prepaid Interest
Processing Fee
Underwriting Fee
Recording Fees
Settlement/Closing/Escrow Fee
Tax Service Fee
Verification Fee
Wire Fee
Items NOT treated as Prepaid Finance Charges are :
Appraisal
Attorney Fee
Credit Report
Doc Prep Fee
Escrows
Notary Fee
Pest Inspection
Points Paid by Seller
Survey
Title Insurance
Well and Septic Inspection
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Well here we are again in Januray and the tax man cometh…Well as I am sure your know by that if you bought a home under the “First Time Homebuyer Credit” in 2009. Also If you bought a home in 2009 you qualify for hugge tax credits. Its your money claim it…
So I thought I would take some time to explain how to claim those credits and get the full advantage of the credit. It should be pointed out that I am not a CPA, so for spefic questions that relate directly to your filling status or eligibilty consult a tax professional.
Who is eligible to claim the $8,000 tax credit?
First-time home buyers purchasing any kind of home—new or resale—are eligible for the tax credit. To qualify for the tax credit, a home purchase must occur on or after January 1, 2009 and on or before April 30, 2010. For the purposes of the tax credit, the purchase date is the date when closing occurs and the title to the property transfers to the home owner. A limited exception exists for certain contract for deed purchases and installment sale purchases. See the IRS website for more detail.
However, the law also allows home sales occurring by June 30, 2010 to qualify, provided they are due to a binding sales contract in force on or before April 30, 2010.
Persons who are claimed as dependents by other taxpayers or who are under age 18 are not qualified for the tax credit program.
What is the definition of a first-time home buyer?
The law defines “first-time home buyer” as a buyer who has not owned a principal residence during the three-year period prior to the purchase. For married taxpayers, the law tests the homeownership history of both the home buyer and his/her spouse.
For example, if you have not owned a home in the past three years but your spouse has owned a principal residence, neither you nor your spouse qualifies for the first-time home buyer tax credit. However, IRS Notice 2009-12 allows unmarried joint purchasers to allocate the credit amount to any buyer who qualifies as a first-time buyer, such as may occur if a parent jointly purchases a home with a son or daughter. Ownership of a vacation home or rental property not used as a principal residence does not disqualify a buyer as a first-time home buyer.
How is the amount of the tax credit determined?
The tax credit is equal to 10 percent of the home’s purchase price up to a maximum of $8,000.
Are there any income limits for claiming the tax credit?
Yes. For sales occuring after November 6, 2009, the income limit for single taxpayers is $125,000; the limit is $225,000 for married taxpayers filing a joint return. The tax credit amount is reduced for buyers with a modified adjusted gross income (MAGI) of more than $125,000 for single taxpayers and $225,000 for married taxpayers filing a joint return. The phaseout range for the tax credit program is equal to $20,000. That is, the tax credit amount is reduced to zero for taxpayers with MAGI of more than $145,000 (single) or $245,000 (married) and is reduced proportionally for taxpayers with MAGIs between these amounts.
The income limits for claiming the tax credit were raised when the tax credit was extended. Are the higher limits retroactive?
No. The new income limits are only applicable to purchases occurring after November 6, 2009.
The income limits for sales occuring on or after January 1, 2009 and on or before November 6, 2009 are $75,000 for single taxpayers and $150,000 for married couples filing jointly.
What is “modified adjusted gross income”?
Modified adjusted gross income or MAGI is defined by the IRS. To find it, a taxpayer must first determine “adjusted gross income” or AGI. AGI is total income for a year minus certain deductions (known as “adjustments” or “above-the-line deductions”), but before itemized deductions from Schedule A or personal exemptions are subtracted. On Forms 1040 and 1040A, AGI is the last number on page 1 and first number on page 2 of the form. For Form 1040-EZ, AGI appears on line 4 (as of 2007). Note that AGI includes all forms of income including wages, salaries, interest income, dividends and capital gains.
To determine modified adjusted gross income (MAGI), add to AGI certain amounts of foreign-earned income. See IRS Form 5405 for more details.
If my modified adjusted gross income (MAGI) is above the limit, do I qualify for any tax credit?
Possibly. It depends on your income. Partial credits of less than $8,000 are available for some taxpayers whose MAGI exceeds the phaseout limits.
Can you give me an example of how the partial tax credit is determined?
Just as an example, assume that a married couple has a modified adjusted gross income of $235,000. The applicable phaseout to qualify for the tax credit is $225,000, and the couple is $10,000 over this amount. Dividing $10,000 by the phaseout range of $20,000 yields 0.5. When you subtract 0.5 from 1.0, the result is 0.5. To determine the amount of the partial first-time home buyer tax credit that is available to this couple, multiply $8,000 by 0.5. The result is $4,000.
Here’s another example: assume that an individual home buyer has a modified adjusted gross income of $138,000. The buyer’s income exceeds $125,000 by $13,000. Dividing $13,000 by the phaseout range of $20,000 yields 0.65. When you subtract 0.65 from 1.0, the result is 0.35. Multiplying $8,000 by 0.35 shows that the buyer is eligible for a partial tax credit of $2,800.
Please remember that these examples are intended to provide a general idea of how the tax credit might be applied in different circumstances. You should always consult your tax advisor for information relating to your specific circumstances.
How is this home buyer tax credit different from the tax credit that Congress enacted in early 2009?
The tax credit’s income limits were increased, the documentation requirements were tightened, and the program’s deadlines were extended.
How do I claim the tax credit? Do I need to complete a form or application? Are there documentation requirements?
You claim the tax credit on your federal income tax return. Specifically, home buyers should complete IRS Form 5405 to determine their tax credit amount, and then claim this amount on line 67 of the 1040 income tax form for 2009 returns (line 69 of the 1040 income tax form for 2008 returns). No other applications are required, and no pre-approval is necessary. However, you will want to be sure that you qualify for the credit under the income limits and first-time home buyer tests. Note that you cannot claim the credit on Form 5405 for an intended purchase for some future date; it must be a completed purchase. Home buyers must attach a copy of their HUD-1 settlement form (closing statement) to Form 5405 as proof of the completed home purchase.
What types of homes will qualify for the tax credit?
Any home that will be used as a principal residence will qualify for the credit, provided the home is purchased for a price less than or equal to $800,000. This includes single-family detached homes, attached homes like townhouses and condominiums, manufactured homes (also known as mobile homes) and houseboats. The definition of principal residence is identical to the one used to determine whether you may qualify for the $250,000 / $500,000 capital gain tax exclusion for principal residences.
It is important to note that you cannot purchase a home from, among other family members, your ancestors (parents, grandparents, etc.), your lineal descendants (children, grandchildren, etc.) or your spouse or your spouse’s family members. Please consult with your tax advisor for more information. Also see IRS Form 5405.
I read that the tax credit is “refundable.” What does that mean?
The fact that the credit is refundable means that the home buyer credit can be claimed even if the taxpayer has little or no federal income tax liability to offset. Typically this involves the government sending the taxpayer a check for a portion or even all of the amount of the refundable tax credit.
For example, if a qualified home buyer expected, notwithstanding the tax credit, federal income tax liability of $5,000 and had tax withholding of $4,000 for the year, then without the tax credit the taxpayer would owe the IRS $1,000 on April 15th. Suppose now that the taxpayer qualified for the $8,000 home buyer tax credit. As a result, the taxpayer would receive a check for $7,000 ($8,000 minus the $1,000 owed).
Instead of buying a new home from a home builder, I hired a contractor to construct a home on a lot that I already own. Do I still qualify for the tax credit?
Yes. For the purposes of the home buyer tax credit, a principal residence that is constructed by the home owner is treated by the tax code as having been “purchased” on the date the owner first occupies the house. In this situation, the date of first occupancy must be on or after January 1, 2009 and on or before April 30, 2010 (or by June 30, 2010, provided a binding sales contract was in force by April, 30, 2010).
In contrast, for newly-constructed homes bought from a home builder, eligibility for the tax credit is determined by the settlement date.
Can I claim the tax credit if I finance the purchase of my home under a mortgage revenue bond (MRB) program?
Yes. The tax credit can be combined with an MRB home buyer program. Note that first-time home buyers who purchased a home in 2008 may not claim the tax credit if they are participating in an MRB program.
I live in the District of Columbia. Can I claim both the Washington, D.C. first-time home buyer credit and this new credit?
No. You can claim only one.
I am not a U.S. citizen. Can I claim the tax credit?
Maybe. Anyone who is not a nonresident alien (as defined by the IRS), who has not owned a principal residence in the previous three years and who meets the income limits test may claim the tax credit for a qualified home purchase. The IRS provides a definition of “nonresident alien” in IRS Publication 519.
Is a tax credit the same as a tax deduction?
No. A tax credit is a dollar-for-dollar reduction in what the taxpayer owes. That means that a taxpayer who owes $8,000 in income taxes and who receives an $8,000 tax credit would owe nothing to the IRS.
A tax deduction is subtracted from the amount of income that is taxed. Using the same example, assume the taxpayer is in the 15 percent tax bracket and owes $8,000 in income taxes. If the taxpayer receives an $8,000 deduction, the taxpayer’s tax liability would be reduced by $1,200 (15 percent of $8,000), or lowered from $8,000 to $6,800.
I bought a home in 2008. Do I qualify for this credit?
No, but if you purchased your first home between April 9, 2008 and January 1, 2009, you may qualify for a different tax credit. Please consult with your tax advisor for more information.
Is there a way for a home buyer to access the money allocable to the credit sooner than waiting to file their 2009 or 2010 tax return?
Yes. Prospective home buyers who believe they qualify for the tax credit are permitted to reduce their income tax withholding. Reducing tax withholding (up to the amount of the credit) will enable the buyer to accumulate cash by raising his/her take home pay. This money can then be applied to the downpayment.
Buyers should adjust their withholding amount on their W-4 via their employer or through their quarterly estimated tax payment. IRS Publication 919 contains rules and guidelines for income tax withholding. Prospective home buyers should note that if income tax withholding is reduced and the tax credit qualified purchase does not occur, then the individual would be liable for repayment to the IRS of income tax and possible interest charges and penalties.
In addition, rule changes made as part of the economic stimulus legislation allow home buyers to claim the tax credit and participate in a program financed by tax-exempt bonds. As a result, some state housing finance agencies have introduced programs that provide short-term second mortgage loans that may be used to fund a downpayment. Prospective home buyers should check with their state housing finance agency to see if such a program is available in their community. To date, 18 state agencies have announced tax credit assistance programs, and more are expected to follow suit. The National Council of State Housing Agencies (NCSHA) has compiled a list of such programs, which can be found here.
HUD is now allowing “monetization” of the tax credit. What does that mean?
It means that HUD allows buyers using FHA-insured mortgages to apply their anticipated tax credit toward their home purchase immediately rather than waiting until they file their 2009 or 2010 income taxes to receive a refund. These funds may be used for certain downpayment and closing cost expenses.
Under HUD’s guidelines, non-profits and FHA-approved lenders are allowed to give home buyers short-term loans of up to $8,000. The guidelines also allow government agencies, such as state housing finance agencies, to facilitate home sales by providing longer term loans secured by second mortgages.
Housing finance agencies and other government entities may also issue tax credit loans, which home buyers may use to satisfy the FHA 3.5 percent downpayment requirement. In addition, approved FHA lenders can purchase a home buyer’s anticipated tax credit to pay closing costs and downpayment costs above the 3.5 percent downpayment that is required for FHA-insured homes.
If I’m qualified for the tax credit and buy a home in 2009 (or 2010), can I apply the tax credit against my 2008 (or 2009) tax return?
Yes. The law allows taxpayers to choose (“elect”) to treat qualified home purchases in 2009 (or 2010) as if the purchase occurred on December 31, 2008 (or if in 2010, December 31, 2009). This means that the previous year’s income limit (MAGI) applies and the election accelerates when the credit can be claimed. A benefit of this election is that a home buyer in 2009 or 2010 will know their prior year MAGI with certainty, thereby helping the buyer know whether the income limit will reduce their credit amount.
Taxpayers buying a home who wish to claim it on their prior year tax return, but who have already submitted their tax return to the IRS, may file an amended return claiming the tax credit using Form 1040X. You should consult with a tax professional to determine how to arrange this.
For a home purchase in 2009 or 2010, can I choose whether to treat the purchase as occurring in the prior or present year, depending on in which year my credit amount is the largest?
Yes. If the applicable income phaseout would reduce your home buyer tax credit amount in the present year and a larger credit would be available using the prior year MAGI amounts, then you can choose the year that yields the largest credit amount.
How can two unmarried buyers allocate the tax credit if one qualifies for the $8,000 first-time home buyer tax credit and the other qualifies for the $6,500 repeat home buyer credit?
The buyers can allocate the tax credit in any reasonable manner, provided neither claims a tax credit higher than the one they qualify for and the home purchase does not yield a total of more than $8,000 in tax credits. For example, the repeat home buyer could claim $6,500 and the first-time home buyer could claim $1,500. Alternatively, both buyers could claim a $4,000 tax credit.
Does a married couple qualify for any home buyer tax credit in the following situation? Spouse A has lived in and owned the same principal residence for at least five years. Spouse B has lived in and owned the same principal residence for less than five years.
In this situation, the couple does not qualify for any home buyer tax credit. Because the couple is married, the law tests the ownership history of both spouses. Spouse A clearly does not qualify for the $8,000 first-time home buyer tax credit, so neither does Spouse B.
Spouse A does appear to qualify for the $6,500 repeat buyer credit, but because Spouse B has not owned and lived in the same principal residence for at least five years, neither of them can claim the repeat home buyer tax credit.
No Doubt this New Years Eve you will celebrate with parties and social gatherings , or someone special…spanning the transition of the year at midnight. …
On New Year’s Eve at midnight, the song Auld Lang Syne is traditionally sung. Often, however, the words of the song are mumbled through beyond the first verse and the chorus, or mispronounced as “old lang syne”.
At the stroke of midnight on New Year’s Eve, as you join fellow revelers in warbling the traditional “Auld Lang Syne,” ask yourself if you understand what you are singing about. It’s fair to say most people don’t. So Here you go read this and you will be prepared come Midnight..and you bring in a new decade 2010 !!! Happy New Year …2010 will be an exciting time int he mortgage industry so dont forget to vist my blog often during the year!!
Here are the Lyrics to Auld Lang Syne
by Robert Burns (1759-96) et al
FIRST VERSE:
Should auld acquaintance be forgot,
And never brought to mind?
Should auld acquaintance be forgot,
And auld lang syne?
CHORUS:
For auld lang syne, my dear,
For auld lang syne,
We’ll tak a cup o’ kindness yet,
For auld lang syne!
SECOND VERSE:
And surely ye’ll be your pint stowp!
And surely I’ll be mine!
And we’ll tak a cup o’ kindness yet,
For auld lang syne.
(REPEAT CHORUS)
THIRD VERSE:
We twahae run about the braes,
And pou’d the gowans fine,
But we’ve wander’d monie a weary fit,
Sin’ auld lang syne.
(REPEAT CHORUS)
FOURTH VERSE:
We twa haepaidl’d i’ the burn
Frae morning sun till dine,
But seas between us braidhae roar’d
Sin’ auld lang syne.
(REPEAT CHORUS)
FIFTH VERSE:
And there’s a hand my trusty fere,
And gie’s a hand o’ thine,
And we’ll tak a right gud-willie waught,
For auld lang syne
(FINISH WITH CHORUS)
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“You’re gonna shoot your eye out !”…Everyone probably recognizes that as the ofen-repeated line from A Christmas Story , the heartwarming tale of a boy who so desperately wants a Red Ryder BB gun for Christmas..The antication of opening presents….Then to only shoot our “Eye out” well not literally but you can definitly shoot your eye out with your mortgage if your not careful.
Do you rememeber The moment when you realized that Santa isn’t real is often a difficult one. Most of us remember that moment – I bet you can also remeber a moment after you bought your house did your refinace that maybe you should have asked more questions, or this payment is what you thought etc….
Well to avoid shooting your eyeout…. here are some suggestions for you this Holiday season….You wouldn’t buy a house without shopping around first, right? Then why would you commit to the loan you use to buy that house without making sure you’re getting the best deal possible? It’s easier than ever to compare multiple offers from mortgage lenders, and, best of all, at places like Priority Mortgage, it’s free. Here are seven reasons why it’s essential to take a few minutes to browse before you borrow:
1. To get the best interest rate possible
Over the life of a $200,000, 30-year fixed rate loan, a one-tenth of a point difference in interest rate could save or cost you thousands of dollars. Do the math yourself with the mortgage loan comparison calculator provided to your left
2. To pay lower loan fees
Once your loan application is accepted, the lender will get back to you with a good-faith estimate, including an itemized list of all the costs associated with the loan. But deciphering your “GFE” may not be as easy as “A,B,C,” so don’t be afraid to ask the lender to explain each fee listed. Sometimes, you can get a lender to waive or lower certain costs, especially application, processing or underwriting fees.
3. To avoid a prepayment penalty
In these transient times, it seems no one stays in their home long enough to pay down their mortgage the old fashioned way: in monthly increments over a period of decades. So you’ll want to be clear on whether the terms of your loan include a penalty if you pay off your mortgage early – either because you move or refinance.
4. To find a lender you feel comfortable with
You don’t want any surprises popping up at closing time. Get a lender who is responsive to your questions and is willing to give you the details in writing.
5. To find a lender that specializes in your situation
Recent volatility in the mortgage markets means that people with bad credit or little money for a down payment might have to look a little harder to find a lender.
6. To get the rate lock period you want
Once you’ve found the lender offering the best mortgage rate and terms, you’ll want to get a written commitment, known as a “lock,” that that lender will make the loan to you at that interest rate. The length of the lock can vary from 30 to 90 days, but many lenders will charge a fee for a rate commitment of longer than a month. Negotiate the lock period that is right for you, depending on when you plan to close on your new home and if interest rates are expected to creep higher during that time.
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Welcome to November …This year has just flown by. Remember back in January you said 2009 is the year I am going to pay off debt, or perhaps buy that new home.
Well there is still time…..Let’s talk about the paying off debt. With rates low it’s a good time to think about using the equity in your home to pay off your debts. With high credit card interest, or if your car payment seems like a big burden then you may want to think about a debt consolidation refinance. When considering whether or not to refinance your home, you must decide if the refinance will result in a net benefit to you. When considering whether or not to refinance your home, you must decide if the refinance will result in a net benefit to you. When considering whether or not to refinance your home, you must decide if the refinance will result in a net benefit to you. It is ultimately up to you to decide what is in your best interest.
Consult a mortgage consultant like myself to see what mortgage programs you can qualify for and which ones will provide you with the best deal for your unique situation. When you refinance, you might be able to lower your interest rate and monthly payment — sometimes significantly. You might also be able to “cash out” some of the built-up equity in your home, which you can use to consolidate debt, improve your home, and take a vacation — whatever! With lower rates and balances, you might also be able to build up home equity faster with a shorter-term new mortgage.
Be careful with debt consolidation refinancing. Sadly, in many cases a family will refinance their mortgage to pay off high interest rate credit card debt only to have these cards maxed out again in just a few months. In this instance the family in question has converted their unsecured credit card debt into a debt secured by the most important thing they own: their home!
Remember that your home and its equity is your largest asset and savings account. You should only refinance if it is with the right lender, at the right time, and for the right reasons. There are new loan programs coming out all the time, one of these programs may better fit your current financial needs. Discuss the possibility of refinancing with your mortgage consultant, and they can give you the additional information that you may need when deciding whether or not to refinance.
Now let’s talk about the purchase of a new home and or the sell of your current home if you currently own a home. If you are considering buying a home in the near future, there are several critical factors which you should be aware of. By and large, the current market is a buyer’s market. That does not mean; however, that most buyers will be able to simply sweep in and pick up a sweet deal for just pennies on the dollar. If you really want to take advantage of the current market, you need to make sure you go in fully prepared.
1. First, you need to make sure you recognize that when it comes to real estate a few months ago, or in some cases, a few weeks ago might as well have been two years ago. Dynamics within the industry are rapidly changing and you simply cannot rely on how the market looked even six months ago. What someone was asking for their house a few months ago is not relevant. You need to make sure that you update yourself on the current market within the local area where you will be buying.
2. In addition, if you have previously purchased a home you need to make sure that you do not fall into the trap of thinking that what you paid for your last home is relevant. This is because it is not. You do need to make sure that you give some thought to the difference between the amount you will be selling your current home for and what it will cost you to purchase a new home. These are definitely much more realistic numbers and will give you a better idea of what you can afford and more importantly what you cannot afford.
3. A few years ago the market was rife with people who were gung-ho about selling their home on their own. For many people, the idea of selling their home on their own meant being able to save the commission. If you already own a home that you will be selling in order to fund the purchase of your next home, it is critical that you understand that now is not the right market to try to go it alone. Yes, you might save the commission, but your home might also sit on the market for a year or longer. There is far more inventory on the current market than there was even two years ago and it is much more difficult to sell a home today. Save yourself the hassle, trouble and time and hire a professional who can help you to get the attention you need to sell your home. If you aren’t working with a Realtor I will be glad to refer you to some the best in the industry
4. Make sure you are aware of the current interest rates. At the current time, any interest rate that is between 4.75 and 5.75 is a good number. If you can get an interest rate in that range, grab it and run and be happy for it.
5. You should also understand that there really is a big difference between working with a mortgage professional. While there are any number of people out there right now hustling trying to help find loans for buyers, when you are making an important financial decision such as buying a home you will need to make sure that you are working with someone you can trust. It really can make a big difference in the long run.
6. You also need to give some thought to how long you plan to be in your next home before you actually commit to buying it. If you do not plan on staying in a home for at least the next five to seven years then you need to seriously think about waiting to buy. In the event that the market continues to drop somewhat over the next year and you buy a home today, you could be set to experience depreciation in the value of the home you buy. That is not necessarily a problem unless you plan to sell it in the next couple of years. If you are in it for the long haul, overall, it will not make that much difference to you. If you plan to sell in less than one or two years; however, it could be a big problem.
7. Finally, recognize that despite the dire numbers and predictions, there really never has been a better time to buy a home; provided that you are ready. If you are in it with a long-term commitment in mind and you are financially ready, there are some great deals available. Over the course of time you will likely find that you will be glad you made the decision to purchase.
Please Check out my Charity and visit the links the links to the right of this blog.
The first 30 minutes of the workday will set the tone for the entire day….This page is desgined to give the first thirty minutes of your day a postive outlook…
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Housing Market
