Keller Williams Stimulus Plan

Arizona Keller Williams Stimulus Plan

Arizona Keller Williams Stimulus Plan is going to help sell homes.
Keller Williams Stimulus Plan was announced this morning on Channel 12 News. This is a win-win for both sellers and buyers. This Stimulus Plan is not government run, help to maintain home values, and will help to sell homes!

Here's how the new Keller Williams Stimulus Plan program works.

Keller Williams Realtors will ask many of their sellers to pay up to 2 "points" at closing in order for the buyer of their home to receive a "sub 4%" 30 year fixed interest rate. Depending on the lender and the property, the rate offered can be as low as 3.75% to 3.875% or lower. The advantage to the seller is increased interest in their property due to an offer of the lowest fixed interest rate in 50 years!

The advantages to the buyer are numerous.

First, the buyer will save every single month with a lower interest rate. In addition, the lower rate allows a buyer to qualify for a higher priced home. Third, the "points" paid by the seller are actually tax deductible for the buyer as "interest paid" in the current tax year. Fourth, if the mortgage is an FHA or VA loan, it is assumable to a buyer that qualifies in the future. This gives today's buyer a very valuable asset to offer in the future sale of their home. Fifth, in most cases, we find the buyer will actually save 10% of the purchase price over the life of the loan.

Here's an example of the Keller Williams Stimulus Plan.

The buyer purchases a home for $250,000 and obtains an FHA Loan with 3.5% down.

The seller pays 2 "points", which totals about $4,900, in order for the Buyer to obtain a 3.75% 30 year fixed rate instead of a 4.25% rate.

The buyer saves about $70 per month in payments, has a $4,900 tax write off and will save over $26,000 in interest and taxes over the life of the mortgage!

The savings over a shorter period of time are obviously much less, $7,500 over 5 years for instance.

However, the value of that 3.75% assumable FHA loan may be extremely high when rates are back up to 6% or 7% in the next 5 years. What a great selling feature that will be!

It's understood the program won't benefit every buyer. If a buyer plans to stay in their home for less than 3 years, they may actually be better off just taking the 2 points as a closing costs credit from the seller or a price reduction. However, who is out there buying a home right now thinking they will only live there for a couple of years?

To learn more about how this program can benefit you as a seller or buyer, or to receive information about which sellers are currently participating, contact Keller Williams Realtor at 480-814-3419.