Tax Credit Extension

Both Houses OK Tax Credit Extension, Expansion The House today and the Senate yesterday passed legislation to extend the $8,000 home buyer tax credit to May 1, 2010, for first-time buyers and add a $6,500 tax credit for repeat buyers if they've lived in their home for five of the past eight years. Home prices are capped at $800,000. The legislation in both houses was included in a bill to extend unemployment benefits and is expected to be signed by President Obama shortly. “REALTORS® appreciate the swift action by Congress to extend the home buyer tax credit and expand it to some current homeowners,” says NAR President Charles McMillan. “As the leading advocate of housing and real estate issues, we urge President Obama to sign this legislation into law quickly to keep the momentum going in the fragile recovery of the nation’s housing market.”Under the bill, income limits are expanded to $125,000 for individuals and $225,000 for joint filers. Individuals with incomes up to $145,000 and joint filers with incomes up to $245,000 qualify for reduced credits.Households who have binding contracts in place by April 30 will be allowed an additional 60 days to complete their transaction. The deadline for members of the military serving out the U.S. for at least 90 days between Jan. 1, 2009, and May 1, 2010, has been extended one year.Taxpayers can claim the credit on their federal income tax returns. If the credit exceeds their tax bill, the government will issue a check. Taxpayers will be able to claim the credit on their 2009 income tax return for purchases made in 2010.Compare the current tax credit with the newly passed version on REALTOR.org. More on the credit is available from NAR.

Chicken and Vegetable Pot Pie

Chicken and Vegetable Pot Pie
Maria Robledo
Serves 6 Hands-On Time: 35m Total Time: 1hr 10m
Ingredients
1 pound boneless, skinless chicken breasts
1 tablespoon olive oil
2 onions, chopped
4 carrots, diced
3 tablespoons all-purpose flour
1/2 cup dry white wine
2 cups 1 percent milk
1 10-ounce package frozen peas
1 tablespoon fresh thyme
kosher salt and black pepper
1 9-inch store-bought piecrust, thawed if frozen
Directions
Heat oven to 400° F. Cook the chicken in a pot of simmering water until cooked through, 10 to 12 minutes; let cool, then shred.
Meanwhile, heat the oil in a saucepan over medium heat. Add the onions and carrots and cook, stir-ring, until they begin to soften, 6 to 8 minutes (do not let them darken). Sprinkle the flour over the vegetables and cook, stirring, for 1 minute.
Add the wine and cook until evaporated, about 5 minutes. Add the milk and simmer until the sauce thickens, 2 to 3 minutes. Stir in the chicken, peas, thyme, 3/4 teaspoon salt, and 1/4 teaspoon pepper. Transfer to a shallow 1 1/2- to 2-quart baking dish.
Lay the crust on top, pressing to seal. Cut several vents in the crust. Place the pot pie on a baking sheet and bake until bubbling and the crust is golden, 30 to 35 minutes.

Tax Credit Extension

Tax Credit Extension Seems Likely It seems likely that the U.S. Senate will approve a deal to extend the First-Time Homebuyer Tax Credit, but the devil is in the details.Florida Democrat Sen. Bill Nelson told reporters traveling to Florida with President Obama on Monday that he thought that the extension would be approved, but both senators and representatives are among those who think that there should be some fiscal offset for the cost of the extension. Spending any more money on the stimulus effort also could stir up a hornets' nest in some circles.
The proposal in the Senate that appears to have the most likelihood of passage would extend the $8,000 credit through March 31, then its value would drop by $2,000 for each of the subsequent three quarters of 2010. This plan was offered by Senate Majority Leader Harry Reid of Nevada and Senate Finance Committee Chairman Max Baucus, a Montana Democrat.

Source: Associated Press, Andrew Taylor (10/26/2009) and The Wall Street Journal, John D. McKinnon (10/27/2009)

Infrared Heaters, Posted 10-13-2009

Brrrrr...., yup it is getting cold here in Kuna, Idaho. We have finished the harvest of the garden and have been grape juicing for the past three weeks. We are definitely good for the winter on grape juice. I still need to make applesauce.

So I have spent the last two weeks researching the infrared Heaters. Edenpur, Sunglow are a couple. It took me a week but I actually found two suppliers of the Sunglow here in our Valley. So I was actually able to test and touch. Only a $1.00 a day to operate, that I really liked. The one we finally ordered was from ebay and we are still waiting for it to get here. I am excitedly awaiting it arrival. Last year my highest heating bill was over $350. Ouch! Plus we had to fill the propane tank (gas fireplace) that was another $700. Big Ouch! So I am definitely on the hunt for more affordable heating. We have a newer electric heat pump, which works good but definitely costs alot to operate when it is cold. You can get the infrared heaters in different sizes. We are getting one that will heat a 1000 sq. ft. The supplier will also be getting the infrared heaters to use in fireplaces. I will be checking that one out as soon as it comes in at our local supplier. Thus we might be able to put a unit in the gas fireplace and the box heater out in the Shop. Just email me if you would like more of my personal information and experience with this type of heat source. Stay Warm!

Stimulus Funds Not Available for Down-Payments 5/20/2009

Stimulus Funds Not Available for Down-Payments
CONTENT UPDATE: According to HUD this program has been "suspended until further notice".
A new twist to the nation's economic stimulus program may make it easier to turn an $8,000 tax credit into a first-time home.
Under a decision announced last week, the U.S. Department of Housing and Urban Development (HUD) will allow eligible first-time homebuyers to use the tax credit authorized under The American Recovery and Reinvestment Act of 2009 during the actual home purchasing process. This will help to eliminate a major stumbling block for many homebuyers - coming up with the cash for a downpayment and closing costs.
As originally envisioned, the $8,000 credit would be available only after home buyers who purchase a home before next December 1 actually owned the home and filed their tax returns. They would then have to wait for the resulting refund. The credit could be claimed on either 2008 or the 2009 return but would still be available only retroactively.
The HUD policy change will permit FHA-approved lenders such as federal, state, and local government agencies and non-profit organizations to provide loans against the potential tax returns at closing to qualified buyers who are financing the purchase through FHA guaranteed first mortgages.
So far, Housing Finance Agencies and other development agencies in 10 states have announced programs under the new HUD guidelines and it is expected that many more will follow suit.
Each participant is free to structure its program but there are some general similarities. Most take the form of a second mortgage and a payoff is expected when the tax return is received. In Colorado, for example, the loan can be for an amount of up to 3.5 percent of the first mortgage loan or $6,000 (whichever is less) and will carry a 0% interest rate until June 30, 2010. There is a $350 administrative fee for issuing the loan, but if the loan is paid by the June 30 date $250 of the fee will be applied toward the payoff. After that date the interest rate will rise to 8% and the loan will amortize over eight years.
In Idaho the loan can be for as much as $7,000 if it does not push the indebtedness over 100 percent loan to value. To qualify the first-time buyer must have a FICO score of at least 640 and the debt ratio cannot exceed 45 percent. A loan from the Idaho program has a 3 percent interest rate.
A list of participating states and information on the program specifics in each state are available on the website for the National Council of State Housing Agencies at www.ncsha.org (click on "HFA First Time Homebuyer Tax Credit Loan Program.)
CONTENT UPDATE: According to HUD this program has been "suspended until further notice".

It is Finally Here

IHFA’s Down Payment Assistance Tax Credit AdvanceThe American Recovery and Reinvestment Act of 2009 provided a federal income tax credit for first-time homebuyers of 10% of the sales price, up to a maximum of $8,000. This tax credit is available to qualified home buyers who purchase a home by December 1, 2009. In order to help buyers monetize this tax credit for down payment and closing costs when they purchase a home, Idaho Housing and Finance Association (IHFA), through its IdaMortgage lending program, is offering a special short-term Tax Credit 2nd Loan to qualified buyers. In conjunction with an IdaMortgage loan, a subordinate loan will be offered to qualified first time homebuyers in the amount not to exceed 5% of the sales price or $7,000. A fee will be charged of $250 with $150 refunded upon repayment of the loan on or before the loan due date. The loan will accrue interest at 3.0% with a due date of July 1, 2010. The Tax Credit 2nd Loan is expected to be paid off from the borrower’s tax refund obtained through the application of the federal tax credit. If the homebuyer defaults on the loan and cannot repay at that time, IHFA has the option of pursuing foreclosure as described in the deed of trust, or modify the loan to amortize over the remaining term of the first mortgage loan at an interest rate of 3% higher than the first mortgage rate. Borrower qualifications are:1) Must be a first time homebuyer,2) Must have a FICO score of no less than 640, and a total debt ratio of no more than 45%,3) Homebuyer qualifies for an IdaMortgage loan. Also, we continue to offer IdaMortgage’s Good Credit Rewards program that helps qualifying borrowers purchase their home. This 2nd mortgage program is available for down payment and closing costs. Here is a list of Good Credit Reward Qualifications:Homebuyers with less than 140% of area median income can now qualify for IdaMortgage's 30-year fixed rate down payment and closing costs assistance second mortgage program. The down payment assistance loan must be combined with an IdaMortgage product. The second mortgage will be offered at 1 to 2% above IdaMortgage's standard interest rate. The Good Credit Rewards down payment and closing cost assistance second mortgage interest rates are tiered by credit score:· Interest rate is 1% higher than mortgage rate of the first mortgage for borrowers with credit scores of 720 or higher.· Interest rate is 2% higher than mortgage rate of the first mortgage rate for borrowers with credit scores of 700 to 719.· Maximum amount of second mortgage is capped at 3.5% for all loan programs, not to exceed 100% combined loan-to-value, or the maximum approved by mortgage insurance guidelines.· Homebuyer education is required for buyers with credit scores lower than 720.· Borrowers with credit scores of lower than 700 will not be able to obtain this second mortgage.· Borrowers must contribute at least $500 towards the transaction, or higher depending on Mortgage Insurance requirements.· Good Credit Rewards funds are based on need. Borrowers cannot have more than an equivalent of three month’s payments in liquid assets after closing.Click here to view IdaMortgage loan products and rates.Click here to view information on the Housing Stimulus Bill (Look under the Breaking News Section)

Life here in the Kuna Country is good. All our neighbors are starting their family anew. The grass is turning green, the tulips have started their way up through the long frozen earth. The snow has melted away from this valley and is still heavy in the mountains. The skiers are still enjoying the spring skiing up on Shaefer Mountain. Our reservours are filling with the water from the mountain snows. I see the water running in our big canals, seems early to me. My best friend and husband is out in the house garden rototilling. The earth has not quite warmed up yet, but we are getting ready for the planting. The robins are here, the finches have come back, the hundreds and hundreds of ducks and geese race in circles across our street above an old corn field before they land and feed. The duck racing is such a mystery to me. Around and around they go, it happens every night at 6 pm. Life here in the country is slow and is good.

IHFA - Loan to Tie in with the Federal Tax Credit

ACAR has been working with IHFA for the last several days to be able to offer a 12 month loan to first-time home buyers so that they will have their federal tax credit to use for down payment and closing costs.We hope to be able to announce the program next week at the Agent2Agent meeting. You won't want to miss this.Imagine how many of your "on the fence" buyers will jump when you tell them that they can get into the house they've been looking at, with no money down!Details are still being worked out...Watch here for more.

First-Time Homebuyer Tax Credit

FIRST-TIME HOMEBUYER TAX CREDIT
As Modified in the American Recovery and Reinvestment Act
Major Modifications "Italicized"
February 2009

REVISED CREDIT-EFFECTIVE FOR PURCHASES ON OR AFTER JANUARY 1, 2009 AND BEFORE DECEMBER 1, 2009

Amount of Credit - Lesser of 10% of cost of home or Maximum credit amount increased to $8,000
Eligible Property - No Change, all principal residences eligible.
Refundable - Yes. Reduces (or can eliminate) income tax liability for the year of purchase. Any unused amount of tax credit refunded to purchaser. No Change. Purchasers will continue to receive refund for unused amount when tax return is filed.
Income Limit - Yes. Full amount of credit available for individuals with adjusted gross income of no more than $75,000 ($150,000 on a joint return). Phases out above those caps ($95,000 and $170,000)
First-time Homebuyer Only - Yes. Purchaser (and purchaser's spouse) may not have owned a principal residence in 3 years previous to purchase.
Revenue Bond Financing - Purchasers who utilize revenue bond financing can use credit.
Repayment - No repayment for purchases on or after January 1, 2009 and before December 1, 2009
Recapture - If home is sold within three years of purchase, entire amount of credit is recaptured on sale. Applies only to homes purchased in 2009
Termination - December 1, 2009
Effective Date - All revisions are effective as of January 1, 2009

Obama foreclosure fix open for business

Federal officials release details of $75 billion loan modification and refinancing programs. Borrowers can start contacting loan servicers.The Obama administration's foreclosure prevention program is open for business.The multipronged fix calls for companies to help as many 4 million struggling borrowers by modifying loans so monthly housing payments are no more than 31% of monthly gross income.Separately, homeowners who haven't missed a payment can refinance into lower-cost loans even if they have little or no equity. This is expected to help up to 5 million homeowners.This plan will help make home ownership more affordable for nine million American families and in doing so, help to stop the damaging impact that declining home prices have on all Americans," said Housing Secretary Shaun Donovan.Borrowers can now contact their servicers to see whether they are eligible for assistance.The loan modification plan focuses on people who are behind in their payments or are at risk of default.Federal officials clarified the definition of "at risk" as those: suffering serious hardships, declines in income or increase in expenses; facing an interest rate hike; having high mortgage debt compared to income; owing more than their house is worth, or demonstrating other reasons for being close to default.
To participate in the loan modification plan, borrowers must:
have obtained their mortgage before Jan. 1, 2009;
have a primary mortgage of less than $729,500;
live in the property;
fully document their income by providing tax returns and pay stubs;sign a statement of financial hardship; and
go for counseling if their total household debt - including auto loans, credit cards and alimony - totals more than 55% of their income.
The modification program will be in effect until the end of 2012. Officials also unveiled more details on how servicers will modify the loans. First, they must reduce interest rates so that borrowers' total house payments are not more than 38% of their monthly income. The government will then subsidize servicers dollar-for-dollar to lower that ratio to 31% - but the interest rate can't go below 2%.
If rate reductions aren't enough to get payments to 31% of income, a lender can extend the term up to 40 years, or shift part of the principal to the end of the loan at no interest. Servicers also have the option of reducing the loan's balance.The program also includes a new provision to eliminate borrowers' second mortgages.