With Cheryl Washington the Time is Now

Cheryl Washington is the Director of Internet Real Estate Client Services for Prudential California Realty. Cheryl specializes in Relocation, eCommerce and Internet Real Estate Services. She provides an invaluable service to her Internet clients (buyers and sellers), and the Prudential California Realty Sales Professionals.

Cheryl manages, coordinates, disburses and cultivates various Internet prospects that find their way to Prudential California Realty via multiple website sources such as, Yahoo! Real Estate, Zillow, Trulia, LendingTree, RealxReferral, RealtyTrac and many others. Cheryl’s job is to place all prospects with an “expert” Real Estate sales and/or lending professional that will best fit the clients’ needs.

Cheryl ensures you work with the best Lenders and Real Estate Short Sale and Foresclosure Specialists.

Cheryl has over twenty-five years of relocation, real estate sales and eService experience. She is a psalmist, singer, writer and poet, has lovely adult children, sings for International New Wave Missions Ministries and Warriors of Valor, as well as other types of venues.

First Time Buyers – Tax Credit for Closing Costs

HUD: Tax Credit Can Be Used on Closing Costs

FHA-approved lenders received the go-ahead to develop bridge-loan products that enable first-time buyers to use the benefits of the federal tax credit upfront, according to eagerly awaited guidance from the U.S. Department of Housing and Urban Development on so-called home buyer tax credit loans that was released today.

Under the guidance, FHA-approved lenders can develop bridge loans that home buyers can use to help cover their closing costs, buy down their interest rate, or put down more than the minimum 3.5 percent.

The loans can’t be used to cover the minimum 3.5 percent, senior HUD officials told reporters on a conference call Friday morning.

Thus, buyers applying for FHA-backed financing with an FHA-approved lender that offers a bridge-loan program can get a bridge loan to bring down the upfront costs of buying a home significantly but would still have to come up with the minimum 3.5 percent downpayment.

There remain many sources of assistance for buyers needing help with the 3.5 percent downpayment, including many state and local government instrumentalities and nonprofit lenders.

In addition, some state housing finance agencies have developed their own tax credit bridge loan programs, so buyers in states whose HFAs offer such programs can monetize the tax credit upfront to cover all or part of their downpayment. These programs are separate from what HUD announced today.

The first-time homebuyer tax credit was enacted last year–and improved upon earlier this year–to help encourage households to enter the housing market while interest rates are low and affordability is high. The credit is worth up to $8,000 and is available to households that haven’t owned a home in at least three years. The credit does not have to be repaid, and is fully reimbursable, so households can get their credit returned to them in the form of a payment.

2008 Housing Bill Highlights

2008 Housing Bill

 

The Housing Bill has been signed by the President. There is a tremendous amount of discussion about the new Bill and the possible positive and negative ramification on New Home Sales, Resale’s, Mortgages and Foreclosures. Here are some highlights of the Bill.

 

·         The Bill takes effect October 1^st 2008

·         Tax Credit for 10.00% of the purchase price up to a maximum of $7,500 for First Time Home Buyers (have not owned a home in the last 3 years) to stimulate demand among first time buyers. The tax credit is actually an interest free loan. If you decide to take the tax credit you have to pay it back over a 15 year period in the form of a tax increase of $500 per year.

·         Permanently increase “conforming loan” limits. The bill would permanently increase the cap on the size of mortgages guaranteed by Fannie and Freddie to a maximum of $625,500 from $417,000. The FHA maximum loan limits for certain high-cost areas would also increase to $625,500.

·         This Bill eliminates all seller-funded down payment assistance programs for FHA loans, like Nehemiah. This will certainly eliminate some potential buyers from the market. In Las Vegas this type of program represents as much as 50% of the sales for some of the major home builders, so the loss of this program will surely impact all sales in the Las Vegas market.

·         FHA minimum down payment will be increased from the current 3.00% to 3.50%.

·         FORECLOSURES – This piece is a little tricky but I will try to explain the nuts and bolts of it as I understand them. The bill encourages lenders to forgive some of the debt owed on a mortgage down to 90% of the homes current appraised value on homes purchased between January, 2005 and June, 2007. Example – You purchased a home for $400,000 and put a 5% down payment of $20,000. You got an ARM loan and now the payment has gone up. You currently owe $380,000 and now it is only worth $300,000 based on a current appraisal. Under this law the lender could forgive everything you owe above $270,000, which is 90% of the current $300,000 value. The lender would forgive $110,000 in debt and you could pay off the loan for $270,000. That allows you to find a new lender that will underwrite and approve a new FHA mortgage.                                                                         

·         SO WHAT IS THE CATCH YOU ASK – Lenders won’t sign off on a workout unless they think that they’ll lose less money on that than they would by allowing a home to go through the costly foreclosure process. The FHA Mortgage Insurance Premium on these loans is expected to be a hefty 3.0% upfront and 1.5% annually. Also, if you decide to use this program you will have to share your home-price appreciation with FHA. If you sell the house or refinance the loan in one year or less from the time you refinanced into the FHA loan, FHA gets 100% of the house price appreciation. The FHA’s cut decreases by 10% each year for the next 5 years, but never drops below 50% of the appreciation, no matter how long you own your home. Is it pricey? Yes. Is it better than losing a home? Definitely.

Call or Email for free assistance with buying or selling property!

Cheryl Washington
Your Real Estate Concierge
209-513-1169
Relocatewithcheryl@yahoo.com