$8,000 First Time Home buying Tax Credit Extended & Expanded for move up buyers!

The $8,000 first-time home buyer tax credit, which helped home sales rebound this year, was scheduled to expire Nov. 30. The legislation extends it to homes that are under contract by April 30, 2010, and creates a new $6,500 tax credit for owners of existing homes who buy a new principal residence. To take advantage of this credit, buyers must have lived in their old house for at least five of the past eight years.
The legislation also increases the income eligibility limits for the tax credit from $75,000 to $125,000 for individuals, and from $150,000 to $225,000 for joint filers. The cost of the home cannot exceed $800,000.
More than 1.4 million households have benefited from the current tax credit, “the majority of whom have incomes below $50,000,” said Rep. John Lewis, D-Ga.
“This legislation would help even more moderate-income families fulfill the American dream,” he said.
Sen. Johnny Isakson, R-Ga., pushed the Senate to expand the tax credit to “move up” home buyers. He said this is the last time the tax credit will be extended.
“I urge all Americans, whether they’re first-time buyers who’ve always dreamed of buying a home of their own or someone who’s been gridlocked in the failure of our move-up market, to take advantage of this opportunity,” said Isakson, a former Realtor.

Is it a Buyers Market or a Sellers Market?

Most buyers have the expectation of a deep buyer’s market where they can take their time and write an offer to purchase a home well below the asking price. With so much negative news swirling around the economy, the recession, employment and the housing market, it is ironic to find that homes priced below $1 million are experiencing tremendous competition and often sell for at or above the asking price. The lower ranges are incredibly hot too. From $250,000 to $500,000, the hottest price range, the expected market time is 1.44 months. That range represents 24% of the current active inventory and 45% of demand. 55% of the active inventory within that range is either a foreclosure or short sale. Buyers are looking for a deal and are looking for foreclosures. 72% of all distressed sales are found below $500,000. It is reasonable to conclude that distressed sales are fueling the market, especially in the lower ranges.

First Time Home Buyers can have a little piece of mind!

The California Association of Realtor's (CAR) is ready to back first time home buyers by providing these buyers with a type of insurance that will pay $1,500 toward their mortgage payment for up to 6 months if the buyer loses their job. The insurance is paid by CAR for the first year and can be extended for subsequent years at the buyers expenses.
Do you Qualify?

1. You must be a first-time home buyer-who has not owned a home the last three years.
2. You must have opened escrow on April 2, 2009, or later, and close on or before Dec. 31, 2009.
3. Did you use a California REALTOR® in the transaction (this is a must since CAR is sponsoring the program...another reason why working with a REALTOR® is a good idea)
4. Purchase the property in California
5. You must be a W-2 employee (cannot be self-employed)

Please contact us for further information, guidelines or if you would like an application.

Are Loan Rates on the Rise?

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.

"THE WORLD IS BUT A PERPETUAL SEE-SAW." Michel de Montaigne. And that sentiment was especially true in the world of Stocks and Bonds last week, as money see-sawed back and forth between the two markets, halting the improvement that Bonds and home loan rates mustered up in the first part of the week.
Bonds and home loan rates began the week looking good - and remembering that inflation is bad news for both Bonds and rates, they were helped along by good news on the inflation front. Inflation at the wholesale or producer level remained tame in May, and at a consumer level, inflation readings came in lower than expected, with a year-over-year reading at its lowest level since 1950. These are good signs that inflation hasn't become an issue yet. However, inflation will be a concern down the road, due to the massive stimulus being injected into the economy. It is said that rates are like a boat floating atop the sea of inflation...as inflation rises, so will home loan rates. If you or someone you know should be acting on today's still low home loan rates, please get in touch soon.
Also helping Bonds rally in the early part of last week was the fact that the New York State manufacturing index came in weaker than estimates, indicating that the US economy is still very weak. And since bad economic news often causes money to flow from Stocks into Bonds, this piece of news helped Bonds start the week on an improving trend.
However, Bonds and home loan rates reversed course midweek and worsened, as money see-sawed back over to Stocks. They were also pressured to worsen by the enormous amount of Bond supply hitting the markets - as too much supply of anything will naturally cause the price to move lower...and in this case, has caused home loan rates to move higher. Posted from the Mortgage Market Guide