I received the following press release earlier today. For those of you that originate FHA loans I hope this means you are going to be working with a lot more first time home buyers. I feel like this is a great step toward fixing the housing market.
Let's hope something to address job losses is in the works and will become available very soon!
Jeff Simpkins, Book Yourself Solid Certified Coach
Community Bank Consulting, Inc.
www.CommunityBankConsulting.
Twitter: http://twitter.com/jeffsimpkins
Facebook: http://profile.to/jeffsimpkins
Free Webinar Wednesdays: http://www.freewebinarwednesdays.com/
We help community banks:
• Reach prospects, customers and clients using low-cost and no-cost marketing tools
• Deliver world class customer service by choosing and using the right technology
First-Time Home Buyer Tax Credit for Closing will Move
Market
WASHINGTON (May 29, 2009) –
Consumers across the country can now take advantage of a Federal Housing
Administration program to allow qualified home buyers to apply the $8,000 tax
credit when purchasing a home. FHA will now permit its
lenders to provide a short-term bridge loan that will let qualified home buyers
use the tax credit to either make a larger
downpayment above the FHA required 3.5 percent, cover closing costs, or buy down
their interest rate.
“A
true housing recovery depends on buyers returning to the market and reducing
inventory,” said National Association of Realtors® President Charles McMillan, a broker with Coldwell
Banker Residential Brokerage in Dallas-Fort Worth. “Since many of the homes
available are lower priced starter homes, the ability for individuals to use the
tax credit at closing should have a meaningful impact on home sales and values
and will allow thousands of families to achieve the dream of homeownership.”
Shaun Donovan, secretary of the
Department of Housing and Urban Development, announced the change today. In an
address to several thousand Realtors® gathered two weeks ago at NAR’s Real Estate Summit:
Advancing the U.S. Economy, Donovan announced HUD’s plan to offer the tax
credit as downpayment assistance. Donovan detailed the modifications to that original proposal and
announcement.
“We all want to enable FHA consumers to access the home
buyer tax credit funds when they close on their home loans,” Donovan said.
According to Donovan, the FHA’s approved lenders will be permitted to “monetize”
the tax credit through short-term bridge loans allowing eligible home buyers to
access the funds immediately at the closing table.
NAR has supported monetization of the tax credit, which
was part of an Obama administration housing stimulus plan enacted earlier in the
year. NAR petitioned HUD to allow home buyers to use the $8,000 tax credit to
help them cover downpayment or closing costs to bring new home buyers to the
market and stimulate home sales.
“We think this is a good program; our members have
been getting many inquiries from potential buyers about it,” McMillan said. “NAR
is pleased that this enhancement has been made to the administration’s housing
recovery program. As we have heard before, there can be no economic recovery
without a housing recovery. With an abundance of inventory, reduced home prices,
historically low interest rates and now the availability of the tax credit at
closing, we expect to see the housing market further stabilize and
improve.”
The National Association of
Realtors®, “The Voice for Real Estate,” is America’s largest
trade association, representing 1.2 million members involved in all aspects of
the residential and commercial real estate industries.
# # #
Information about NAR is available at www.realtor.org. News releases are posted in the Web site’s “News
Media” section in the NAR Media Center.
