Real estate aficionados who follow the upswings and dips in the Orlando real estate market were worried that the end of the first-time homebuyer’s credit would mean an end to housing sales. Sales were up, prices were down and the market seemed to be stabilizing – thanks, in large part, to the tax credit. The tax credit motivated potential homebuyers to become actual homebuyers, which kept home sales stable.
Fortunately, those worries were groundless. President Obama signed a five-month extension on the first-time buyer tax credit November 6th. The Worker, Homeownership and Business Assistance Act of 2009 covers quite a few new bits of housing legislation:
• Extends the first-time tax credit until April 30, 2010
• Expands to include those homebuyers that haven’t owned a home in three or more years
• Allows first-time buyers that are overseas military personnel to take advantage of the credit until May 2011
• Requires documented proof that the buyer actually bought a home
• Changes the credit amount from $8,000 to “$8,000 or 10% of the home’s value”, whichever is less
• Sets the qualification guidelines at $125,000 a year or less for individuals and $225,000 or less for couples (credit amount becomes a scaled decrease above these income levels)
• Requires a minimum age of 18 for those applying for the tax credit
• Adds $6,500 tax credit for those that have lived in a home for at least five years, but want to buy a larger house
I think a lot of people want to own a home, and the extension of the tax credit can only help. As a result of the extension, buyers may take a little longer, peruse the Orlando real estate market and make sure they’ll enjoy the home they buy. While I don’t see a long line of buyers standing in line, I do see the potential for long-term market stabilization.
If you want to take advantage of the new tax credit extension, we can help. Call us today at 407-876-5771 for more information.
Thursday, December 3, 2009
FHA On Solid Ground: Hope for Orlando Real Estate Owners
A recent interview with FHA commissioner David Stevens on CNBC gives hope to Orlando real estate owners with FHA loans. The Federal Housing Administration now covers at least 30% of new home loans, so when Stevens announced that it might not make its 2% capital reserve, people were understandably nervous. For no reason, Stevens says in the CNBC interview.
Instead of immediate risk management in the form of strict guidelines that might make it harder on potential Orlando real estate owners, such as those Fannie Mae and Freddie Mac have put on condo mortgages, the FHA is going for some changes. The changes include hiring a chief risk officer and requiring higher capital standards for loan originators.
Once it was out that the FHA wouldn’t meet its 2% (please note that the FHA itself is the one who broke the news), news portals, blogs and other websites spread the news that the FHA was a train wreck. However, the CNBC interview with Stevens cleared the air a bit.
It appears that the FHA, put in place for instances like this when people can’t afford other loans, actually has two capital accounts. According to Stevens, the FHA has “lots of capital in primary reserve to cover expected defaults.” Combined, FHA capital is over $30 billion dollars.
At the present, says Stevens, the FHA isn’t considering a minimum credit score, and they may not have to. Looking at their portfolio, the average credit score has gone up 60 points, from 630 to 690, pointing to a higher quality of borrowers.
So, when thinking about buying Orlando real estate and looking at mortgage companies, don’t forget to look at the FHA. If Fannie Mae and Freddie Mac are lending, the FHA is – and it’s going strong!
You can watch the CNBC video for the full interview.
If you’re looking for a beautiful home, we can help. Call us now at 407-876-5771 for more information.
Instead of immediate risk management in the form of strict guidelines that might make it harder on potential Orlando real estate owners, such as those Fannie Mae and Freddie Mac have put on condo mortgages, the FHA is going for some changes. The changes include hiring a chief risk officer and requiring higher capital standards for loan originators.
Once it was out that the FHA wouldn’t meet its 2% (please note that the FHA itself is the one who broke the news), news portals, blogs and other websites spread the news that the FHA was a train wreck. However, the CNBC interview with Stevens cleared the air a bit.
It appears that the FHA, put in place for instances like this when people can’t afford other loans, actually has two capital accounts. According to Stevens, the FHA has “lots of capital in primary reserve to cover expected defaults.” Combined, FHA capital is over $30 billion dollars.
At the present, says Stevens, the FHA isn’t considering a minimum credit score, and they may not have to. Looking at their portfolio, the average credit score has gone up 60 points, from 630 to 690, pointing to a higher quality of borrowers.
So, when thinking about buying Orlando real estate and looking at mortgage companies, don’t forget to look at the FHA. If Fannie Mae and Freddie Mac are lending, the FHA is – and it’s going strong!
You can watch the CNBC video for the full interview.
If you’re looking for a beautiful home, we can help. Call us now at 407-876-5771 for more information.
Saving Foreclosures in Orlando with New Fannie Mae Program
As the number of foreclosures rise around the nation, some lenders have held their foreclosures in Orlando in private stock, hoping to sell them gradually in a stabilizing real estate market. That hope has slowly dwindled, however, even with the five-month extension on home buying tax credits signed by the President November 6th of this year.
Government-owned Fannie Mae may have come up with a solution.
Deed-in-Lieu
Some homeowners facing foreclosures in Orlando have more than foreclosure, loan modification or short sale options. Some qualify for a deed-in-lieu (DIL), where they sign away all their equity back to the lender and walk away “debt free” (except, possibly, for taxes). Unfortunately, a DIL leaves the homeowner without a home to live in, and the lender with a house to sell in an uncertain market.
Deed for Lease Program
Under Fannie Mae’s new Deed for Lease Program (D4L), those who go through the DIL process may be eligible to rent their home back from Fannie Mae at current market rental rates. This may not sound like a great deal, but many families have ended up on the street because of foreclosure. Those who qualify for the D4L Program will be able to remain in their homes for at least 12 months. To learn more, read the entire D4L Program eligibility list. Here are a few of the qualifications:
• No prohibitive Homeowner’s Association rental limitations
• The cost of any required repairs is an acceptable amount, based on the value of the property
• The income the lender receives from the current rental market should be expected to cover any maintenance/management costs
• The current rental rates must be less than 31% of your gross income
• The home must be a primary residence
Whether the D4L Program will help or hinder the number of foreclosures in Orlando is still up in the air, but it does give homeowners other options – something they’ve been sorely lacking.
If you’re facing foreclosure and qualify for short sale, we would love to help. Call us at 407-8776-5771 for more information.
Government-owned Fannie Mae may have come up with a solution.
Deed-in-Lieu
Some homeowners facing foreclosures in Orlando have more than foreclosure, loan modification or short sale options. Some qualify for a deed-in-lieu (DIL), where they sign away all their equity back to the lender and walk away “debt free” (except, possibly, for taxes). Unfortunately, a DIL leaves the homeowner without a home to live in, and the lender with a house to sell in an uncertain market.
Deed for Lease Program
Under Fannie Mae’s new Deed for Lease Program (D4L), those who go through the DIL process may be eligible to rent their home back from Fannie Mae at current market rental rates. This may not sound like a great deal, but many families have ended up on the street because of foreclosure. Those who qualify for the D4L Program will be able to remain in their homes for at least 12 months. To learn more, read the entire D4L Program eligibility list. Here are a few of the qualifications:
• No prohibitive Homeowner’s Association rental limitations
• The cost of any required repairs is an acceptable amount, based on the value of the property
• The income the lender receives from the current rental market should be expected to cover any maintenance/management costs
• The current rental rates must be less than 31% of your gross income
• The home must be a primary residence
Whether the D4L Program will help or hinder the number of foreclosures in Orlando is still up in the air, but it does give homeowners other options – something they’ve been sorely lacking.
If you’re facing foreclosure and qualify for short sale, we would love to help. Call us at 407-8776-5771 for more information.
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