Alison Moss - Cincinnati Real Estate

WCPO news reported the results from a Men’s Health Magazine poll that named Cincinnati the third quietest city in the nation. They based their results on a whether cities have noise ordinances, how much traffic they have and how many residents say they get less than seven hours of sleep per night. Just another reason why Cincinnati is a great place to own real estate.

I received some useful information from one of the loan officers I work with, Mike Zipfel from Midwest Mortgage. Home loan interest rates have been on a downward trend for the last few months, however as the economy begins to stabilize, and the stimulus money enters the economy, interest rates are beginning to rise. In the last week, rates have risen above 6% for the first time in recent history.

There are wide economic factors that drive interest rates and a number of economists on a recent NPR program feel that as inflation begins to appear interests rates will rise. A 1% change in interest rates can make a difference in the price range that a buyer afford. Below is a table that shows the impact a 1% interest rate increase can have in the monthly payments on a 30 year mortgage.

With this information in mind we are suggesting that any prospective home buyers who have been considering making a move do so now to take advantage of the affordability of Cincinnati’s current real estate market, the low interest rates, and the $8,000 tax credit for first time home buyers.

I just got new information from HUD released today May 29, 2009 that the $8,000 tax credit can be used toward the downpayment of an FHA insured home. HUD stated on their website that families can only access this credit after filing their tax returns with the IRS This is great news for buyers and sellers of Cincinnati Real Estate.

Today’s announcement details FHA’s rules allowing state Housing Finance Agencies and certain non-profits to “monetize” up to the full amount of the tax credit (depending on the amount of the mortgage) so that borrowers can immediately apply the funds toward their down payments. Home buyers using FHA-approved lenders can apply the tax credit to their down payment in excess of 3.5 percent of appraised value or their closing costs, which can help achieve a lower interest rate. To read the FHA’s new mortgagee letter, visit HUD’s website.

Current law does not permit approved lenders to monetize the tax credit to meet the required 3.5 percent minimum down payment, but, under the terms of today’s announcement, lenders can now monetize the tax credit for use as additional down payment, or for other closing costs, which can help achieve a lower interest rate. Buyers financing through state Housing Finance Agencies and certain non-profits will be able to use the tax credit for their downpayments via secondary financing provided by the HFA or non-profit. In addition to the borrower’s own cash investment, FHA allows parents, employers and other governmental entities to contribute towards the downpayment. Today’s action permits the first-time homebuyer’s anticipated tax credit under the Recovery Act to be applied toward the family’s home purchase right away. Unlike seller-funded down-payment assistance, which was a vehicle for abuse, this program will allow homebuyers to shop for the best home price and services using their anticipated tax credit.

If you refinance your home here are some tips for buyers of Cincinnati Real Estate to be sure that your old loan has been closed out.

1) Be sure to purchase the consumer protection insurance.

Even if you have worked with the title company for years, companies that have been around for years are going out of business and $15 is worth the piece of mind.

2) Even though the title company who closes your loan is responsible for seeing that your payoff for your old loan, be sure the bank receives the payoff before the next payment is due.

Sometimes things can go wrong and banks and title companies make mistakes. Ultimately you are inhabiting the home and your name is on the loan, so you are responsible and will bear the burden if the payment isn’t received on time. I spoke to Bank of America today, and I was told that if a payoff isn’t received and you haven’t paid your mortgage that month which most people don’t when they plan to close a refinance mid-month, then the bank will report a late payment to the credit bureaus.

Always call your bank to be sure that they have received the payoff and keep all documentation that they send you in the mail.

3) Ohio law requires the title company to hold your file for 3 business days before processing the payment in case you change your mind and cancel the refinance, so build this into your timeframes when you are trying to plan a closing.