It is no secret that Washington area housing is some of the most expensive in the country, but there's an array of programs designed to assist first-time home buyers.
First-time buyers should get themselves on every list they qualify for, Doug Myrick, the Arlington County homeownership coordinator, said at a recent panel discussion on affordability programs hosted by First Horizon National Corp., a lender.
These plans aren't reserved just for the poorest people. In recent years, the lack of "workforce" housing has propelled many jurisdictions to create programs to assist those with moderate incomes as well as county or city government employees, including teachers and police officers. For example, , a state program in Arlington County could help a single person making up to $86,500 a year buy a residence priced as high as $408,100. Income restrictions vary among jurisdictions and programs.
And there are many programs to help people with low to moderate incomes. The Virginia Housing Development Authority makes annual allocations to local jurisdictions for its Sponsoring Partnerships and Revitalizing Communities (SPARC) loans and HomeStride loans.
Jurisdictions tailor the programs to meet local needs and housing prices. In some Virginia jurisdictions, a purchaser could couple a SPARC loan with a HomeStride loan, which is a deferred payment second mortgage of up to $25,000. Other localities, such as Manassas, don't allow programs to be combined. Many places have additional programs; Alexandria has at least three others. In Maryland, residents apply for loans through approved lenders who then in essence sell the loans to the Maryland Department of Housing and Community Development.
Montgomery County has programs parallel to the state's. Frederick County is working toward implementing several programs aimed at expanding affordable housing, , said Jenny Short, the county's director for Housing and Community Development.
The District has a few programs. One is aimed specifically toward government employees; another is for police officers. First-time buyers in the District who meet income requirements are also eligible for a federal tax credit of up to $5,000.
Other jurisdictions also offer special programs for local government employees such as teachers, police officers and firefighters, as well as to those who work for participating employers. For instance, Maryland's "House Keys 4 Employees" plan matches up to $5,000 where the participating employer and employee would chip in $5,000 each. Arlington County is also partnering with seven local employers for a similar program.
The would-be buyer must follow the jurisdiction's process, which often includes a prescreening followed by several steps. In many cases, the purchaser must take an accredited home buying class. These are given by the government or by approved companies and nonprofit groups.
The federal government defines a first-time buyer as someone who has not owned a home within three years. All the programs require that participants live in the house as their primary residence.
Washington Post
By Sarah Abruzzese
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I'll keep posting relevant articles that will help keep you in the know!
Wednesday, April 8, 2009
Monday, March 30, 2009
Fed Keeps Hammer Down on Mortgage Rates
Sometimes we get lost in the immediate things around us, we forget some of the other things the Government has been working on, and how they are affecting our business today…
Great article…and very relevant!
The Government put into play in November the plan to buy Mortgage Backed Securities, and lend a hand to Freddie mac…well, this is one of the big reasons the rates have stayed low…
So, remember, the plans are being added today, and coupled with things of the past, will begin to put the floor in prices and stimulate more buyers to buy…if the homes are priced right!
Fed keeps hammer down on mortgage rates
Mortgage-backed securities purchases could reach $1.25 trillion
By Inman News, Thursday, March 19, 2009.
Inman News
In a bid to keep mortgage rates low, the Federal Reserve said Wednesday it will boost purchases of mortgage-backed securities this year to as much as $1.25 trillion -- a $750 billion increase from a previous commitment.
The move is part of a $1.15 trillion expansion of the Fed's balance sheet that's intended to encourage borrowing and revive the economy. Having effectively slashed short-term interest rates to zero, the Federal Open Market Committee is resorting to other means to stimulate growth.
In addition to stepping up purchases of mortgage-backed securities, the Fed said it would purchase up to $300 billion in long-term Treasury securities over the next six months, and doubled a previous commitment to buy $100 billion in debt issued by Fannie Mae, Freddie Mac and the Federal Home Loan Banks.
The move should give would-be homebuyers and those seeking to refinance confidence that mortgage interest rates will stay low for months to come. So far, the Fed has used up only $217 billion of a $600 billion program launched last fall to drive down mortgage interest rates.
In November, the Fed kicked off the program with a promise to buy up to $100 billion in debt from Fannie Mae, Freddie Mac and the Federal Home Loan Banks, and $500 billion in mortgage-backed securities backed by Fannie Mae, Freddie Mac and Ginnie Mae. The program has been widely credited with bringing down interest rates on conventional, conforming mortgages to historic lows of around 5 percent.
Some economists worry that the Fed's growing obligations, along with other government spending and tax cuts intended to jump-start the economy, will spur inflation. The committee, which sets monetary policy, issued a statement saying the near-term outlook for the economy is "weak," and that members expect inflation to "remain subdued."
Great article…and very relevant!
The Government put into play in November the plan to buy Mortgage Backed Securities, and lend a hand to Freddie mac…well, this is one of the big reasons the rates have stayed low…
So, remember, the plans are being added today, and coupled with things of the past, will begin to put the floor in prices and stimulate more buyers to buy…if the homes are priced right!
Fed keeps hammer down on mortgage rates
Mortgage-backed securities purchases could reach $1.25 trillion
By Inman News, Thursday, March 19, 2009.
Inman News
In a bid to keep mortgage rates low, the Federal Reserve said Wednesday it will boost purchases of mortgage-backed securities this year to as much as $1.25 trillion -- a $750 billion increase from a previous commitment.
The move is part of a $1.15 trillion expansion of the Fed's balance sheet that's intended to encourage borrowing and revive the economy. Having effectively slashed short-term interest rates to zero, the Federal Open Market Committee is resorting to other means to stimulate growth.
In addition to stepping up purchases of mortgage-backed securities, the Fed said it would purchase up to $300 billion in long-term Treasury securities over the next six months, and doubled a previous commitment to buy $100 billion in debt issued by Fannie Mae, Freddie Mac and the Federal Home Loan Banks.
The move should give would-be homebuyers and those seeking to refinance confidence that mortgage interest rates will stay low for months to come. So far, the Fed has used up only $217 billion of a $600 billion program launched last fall to drive down mortgage interest rates.
In November, the Fed kicked off the program with a promise to buy up to $100 billion in debt from Fannie Mae, Freddie Mac and the Federal Home Loan Banks, and $500 billion in mortgage-backed securities backed by Fannie Mae, Freddie Mac and Ginnie Mae. The program has been widely credited with bringing down interest rates on conventional, conforming mortgages to historic lows of around 5 percent.
Some economists worry that the Fed's growing obligations, along with other government spending and tax cuts intended to jump-start the economy, will spur inflation. The committee, which sets monetary policy, issued a statement saying the near-term outlook for the economy is "weak," and that members expect inflation to "remain subdued."
Monday, March 23, 2009
March Edition of Talk to Terry Released!
Hello!
I just wanted to post a quick note and let you know that I have just released my monthly video on what's happening in the real estate market in both the North Atlanta Market and National Market. There is some new updates to my about me page including a new video.
Check it out! http://www.talktoterry.com/
Sincerely with PASSION,
Terry Swanson
I just wanted to post a quick note and let you know that I have just released my monthly video on what's happening in the real estate market in both the North Atlanta Market and National Market. There is some new updates to my about me page including a new video.
Check it out! http://www.talktoterry.com/
Sincerely with PASSION,
Terry Swanson
Friday, March 20, 2009
How a 'Perfect Storm' Led to the Economic Crisis
I liked the way this broke down relatively quickly what we have been through…read it, some of the best is at the end of it!
Click Here for the article.
Click Here for the article.
Friday, March 13, 2009
How Obama's Plan Would Work for Borrowers
Here are answers to some common questions about the Obama administration's new foreclosure-prevention plan.
What do these programs involve?
One component calls for reducing payments for distressed borrowers through modifications of loan terms, known as loan mods. A second involves refinancing mortgages for some people who are current on their payments but have little or no equity in their homes.
When does this start?
Immediately.
How do I know whether I qualify for a loan modification?
For starters, this program applies only to your primary residence. That could be a home for one to four families, condo, cooperative apartment or manufactured home affixed to a foundation. It doesn't apply to second homes or investment properties, and the home can't be vacant or condemned. It also doesn't apply to mortgages on one-unit homes whose balances exceed $729,750.
And it isn't for people who can easily afford to pay their loans. You qualify only if your mortgage payment is more than 31% of your pretax monthly income. The monthly payment includes principal, interest, taxes, insurance and homeowner association or condominium fees. Income includes wages, salary, overtime, fees, commissions, tips, Social Security, pensions and other items.
You may qualify whether or not you are up to date with your payments, but you will need to show that you don't have sufficient cash or other readily available assets to meet your current payments.
If I think I may qualify, what's the first step?
Call your loan servicer, the company that sends you your monthly mortgage bill. If you want a counselor to help you, you can request free counseling from approved counseling organizations by dialing the Hope Hotline at 888-995-4673. Avoid firms that charge you a fee for helping you get a loan mod.
Aside from lower payments, what are the benefits of participating?
As long as participants stay current on the modified loans, they can get reductions of as much as $1,000 each year in their principal balance for five years.
Can everyone with a hardship be helped?
No. Servicers will apply a "net present value" test to determine whether a loan modification is in the financial interests of the lender or investor who owns the loan. If it isn't, you may not qualify.
Do I have to pay a fee for a loan mod?
No.
How do I know whether I qualify for the refinancing part of this plan?
You must be current on your payments and your loan must be owned or guaranteed by government-backed mortgage companies Fannie Mae or Freddie Mac.
These refinancings are designed for cases in which the loan balance is between 80% and 105% of the estimated value of your home. (Those below 80% should be able to get refinanced without the help of this program by contacting lenders or mortgage brokers.) Loan servicers will use computer programs or other means to estimate the value of your home.
These refinancings also are available for second homes and investment properties in some cases.
How do I find out if my loan is owned or guaranteed by Fannie or Freddie?
Your loan servicer or counselor should be able to determine that. On your own you can contact Fannie by calling 1-800-7FANNIE or visiting this Web site: www.fanniemae.com/homeaffordable. To reach Freddie, call 1-800-FREDDIE or go to www.freddiemac.com/avoidforeclosure.
Do I have to pay a fee for a refinanced loan?
Lenders or mortgage brokers may charge fees, which are likely to vary.
How long will these programs last?
The modification plan ends Dec. 31, 2012, and loans can be reworked only one time under this program. The refinance program ends in June 2010.
Where can I get more information?
The U.S. Treasury has provided information at www.financialstability.gov.
Couresty of WSJ. Written by By JAMES R. HAGERTY
What do these programs involve?
One component calls for reducing payments for distressed borrowers through modifications of loan terms, known as loan mods. A second involves refinancing mortgages for some people who are current on their payments but have little or no equity in their homes.
When does this start?
Immediately.
How do I know whether I qualify for a loan modification?
For starters, this program applies only to your primary residence. That could be a home for one to four families, condo, cooperative apartment or manufactured home affixed to a foundation. It doesn't apply to second homes or investment properties, and the home can't be vacant or condemned. It also doesn't apply to mortgages on one-unit homes whose balances exceed $729,750.
And it isn't for people who can easily afford to pay their loans. You qualify only if your mortgage payment is more than 31% of your pretax monthly income. The monthly payment includes principal, interest, taxes, insurance and homeowner association or condominium fees. Income includes wages, salary, overtime, fees, commissions, tips, Social Security, pensions and other items.
You may qualify whether or not you are up to date with your payments, but you will need to show that you don't have sufficient cash or other readily available assets to meet your current payments.
If I think I may qualify, what's the first step?
Call your loan servicer, the company that sends you your monthly mortgage bill. If you want a counselor to help you, you can request free counseling from approved counseling organizations by dialing the Hope Hotline at 888-995-4673. Avoid firms that charge you a fee for helping you get a loan mod.
Aside from lower payments, what are the benefits of participating?
As long as participants stay current on the modified loans, they can get reductions of as much as $1,000 each year in their principal balance for five years.
Can everyone with a hardship be helped?
No. Servicers will apply a "net present value" test to determine whether a loan modification is in the financial interests of the lender or investor who owns the loan. If it isn't, you may not qualify.
Do I have to pay a fee for a loan mod?
No.
How do I know whether I qualify for the refinancing part of this plan?
You must be current on your payments and your loan must be owned or guaranteed by government-backed mortgage companies Fannie Mae or Freddie Mac.
These refinancings are designed for cases in which the loan balance is between 80% and 105% of the estimated value of your home. (Those below 80% should be able to get refinanced without the help of this program by contacting lenders or mortgage brokers.) Loan servicers will use computer programs or other means to estimate the value of your home.
These refinancings also are available for second homes and investment properties in some cases.
How do I find out if my loan is owned or guaranteed by Fannie or Freddie?
Your loan servicer or counselor should be able to determine that. On your own you can contact Fannie by calling 1-800-7FANNIE or visiting this Web site: www.fanniemae.com/homeaffordable. To reach Freddie, call 1-800-FREDDIE or go to www.freddiemac.com/avoidforeclosure.
Do I have to pay a fee for a refinanced loan?
Lenders or mortgage brokers may charge fees, which are likely to vary.
How long will these programs last?
The modification plan ends Dec. 31, 2012, and loans can be reworked only one time under this program. The refinance program ends in June 2010.
Where can I get more information?
The U.S. Treasury has provided information at www.financialstability.gov.
Couresty of WSJ. Written by By JAMES R. HAGERTY
Monday, February 23, 2009
Links of Interest - Stopping the Forclosure Wave
Check out this link of interest. It shows other actions, outside of the first time homebuyer’s tax credit, that are being taken to shore up the foreclosure tidal wave everyone is fearing…this must be stopped, or the values could continue to drop, and lending only to become tighter…
The plan is not going to help those that were not being smart about what they were buying, or lending…that is good…if you were being stupid, there is no foreclosure protection for you is basically what the end states…
This will probably be the beginning of different things the Government will embark on to stop the foreclosure wave…it will not be the only step I am sure…
http://www.apnews.com/ap/db_6775/contentdetail.htm?contentguid=gluREL8h&src=cat&dbid=6775&dbname=Top+Stories&storycount=10&detailindex=2
Sincerely with PASSION!
The plan is not going to help those that were not being smart about what they were buying, or lending…that is good…if you were being stupid, there is no foreclosure protection for you is basically what the end states…
This will probably be the beginning of different things the Government will embark on to stop the foreclosure wave…it will not be the only step I am sure…
http://www.apnews.com/ap/db_6775/contentdetail.htm?contentguid=gluREL8h&src=cat&dbid=6775&dbname=Top+Stories&storycount=10&detailindex=2
Sincerely with PASSION!
Wednesday, February 18, 2009
Housing Stimulus Initiative
Hello All!
I just finished my last meeting this morning, and will be returning tomorrow...It has been GREAT!
As you are probably aware, the Housing Stimulus Initiative lead by Johnny Isackson was denied in the overall package, and they simply changed the original version of the $7,500 tax credit to first time homebuyers...
Here is what the changes, of what we understand right now, mean:
- $8,000 Tax Credit for FIRST TIME HOMEBUYERS only (increase of $500)
- Does NOT need to be paid back (considerable change)
- Begins on purchases as of January 1st, 2009
- Only available to an individual earning less than $75k, and couples up to $150k
That is a quick breakdown...Not at all what was hoped for, BUT there may be more to come...MAYBE!
NAR is lobbying to push a separate initiative specifically to address the housing situation...this will be pushed over the next two weeks.
Apparently, President Obama has indicated to NAR that the first step was to address the Economy, and then address the housing scenario.
NAR is working very close and hard to get other initiatives forward...they will probably not be exactly what we believe will stimulate enough, but every step will be a step further than where we are today...
Over the next week, the full details will be understood in clear detail, but for now, what is above is the closest I can get an understanding of...
THIS IS SOMETHING YOU NEED TO UNDERSTAND AND EMAIL TO YOUR FRIENDS AND CLIENTS!!!!!
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