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.