HUD Withdraws Offer/Statement on $8000 Tax Credit

On Tuesday I wrote about an exciting new program that HUD & FHA were rolling out to let the $8000 Tax Credit for First Time Homebuyers be used as a downpayment.

That has now been retracted, and the letter removed from the HUD site.

Yet Yesterday, HUD Secretary Donovan said that many states already were monetizing the tax credit, creating a so-called “Bridge Loan” where the money is loaned up front from the credit due down the line. This is, in essence, what the downpayment “credit” would come from. Here are more details from the National Association of Realtors conference where Donovan spoke.

Jeff Belonger, an FHA specialist ,wrote about it this morning, explaining the legal problems with the plan as proposed.

So not totally gone, but may not be available everywhere. OK, Maryland, are we going to be in? Can we get it done like Washington State has?

$8,000 Tax Credit Can Be Used for Downpayment for Baltimore Homebuyers

**Update May 14, 2009, please see my update that HUD has retracted its statement and that this may NOT be the case everywhere.**

The Secretary of the U.S. Department of Housing and Urban Development announced at the National Association of Realtors summit today that the FHA is going to allow lenders to let First Time Homebuyers use the $8000 tax credit currently in place as a downpayment rather than having to wait until they file their tax returns.

Secretary Donovan stated: “We all want to enable FHA consumers to access the home buyer tax credit funds when they close on their home loans so that the cash can be used as a downpayment.”

On the heels of the Fannie Mae & Freddie Mac 105% Refinance Plus Program announced last month, this is a great indication of how the Obama Administration is working hard to stabilize the housing market and the economy in general.

More details will be forthcoming, and until then, the details can be found here.

So, what are you waiting for, Baltimore Homebuyers? THE TIME TO BUY IS NOW! Don’t miss your chance!

105% Refinance on Fannie Mae or Freddie Mac Owned Loans

Yes, believe it or not, you read that right. Tasha Linton, of Atlantic Home Equity Mortgage shared with our office that they are offering 105% Refi Plus on Fannie Mae or Freddie Mac Loans!

What’s the deal? Primary and investment properties qualify (no limit to amount of properties owned). You can refi up to 105% LTV with NO mortgage insurance.

Why? This initiative is part of the Making Home Affordable program announced on March 4, 2009. According to the Fannie Mae website:

The goal of the refinance initiative, as announced by the President, is “to provide access to low-cost refinancing for responsible homeowners suffering from falling home prices.”

How do you know if you have a qualifying loan? You can check your qualifications right on the Making Home Affordable site, or call Tasha right away at 443-992-0783.

So what’s the catch? Well, you get limited cash out (which, in this market/economy makes sense). Also you must presently have no mortgage insurance. It is also currently only available until July 2009!

This is a great opportunity for those that have adjustable rate mortgages or interest only loans. This opportunity is not just for Baltimore homeowners, it is all over the US.

So take advantage if you are eligible. Here is YOUR bailout for being a conscientious homeowner!

Government Bailouts and Fairness to All

We have all heard about the banks being bailed out, the car makers possibly being bailed out, and those in financial crisis being bailed out. But what about those people who have been financially responsible? Why are those left out of the mix? How is that fair?

David M. Michonski, Chairman and CEO of Coldwell Banker Hunt Kennedy in New York City discusses this in RIS Media’s December 3, 2008 article, Solving Housing and Fairness in 48 Hours .

He has some very valid points and positive ways to solve the fairness issue. The problem is that others have to adjust their way of thinking as well, and that includes the banks who may be in trouble.

Read this excerpt:

“I suggest we change our thinking to focus on those who want to and can be stimulated, i.e. those many people sitting with cash on the sidelines and who are just afraid to act at this point in time. The economy may be sick, but there are still plenty of healthy people around. We need something to stimulate them to part with some of the cash they are sitting on.

How? Simple: give the healthy sector of the economy a bargain they cannot resist. Americans like a bargain and will act upon them.

What is a bargain? Give creditworthy buyers a 4% 30-year fixed assumable mortgage with no prepayment penalty. Creditworthy is someone with 20% down or 20% equity in their home, who has good credit and a verifiable job. Make it a new loan or a refinancing of an existing loan. Simple enough.”

GOOD THINKING! And can you imagine what that would do for the falling housing market?

There are many GOOD QUALIFIED buyers out there who have learned from the past to just wait. But what if we could convince them not to? How great would that be for our economy?????!!!!!! Plus, putting your money in real estate is, in general, safer and more profitable over time than the stock market. So why NOT?

Please, Banks, tell us why this has not happened yet. And hurry up and jump onboard.