Harpal Harika, Fremont Realtor

On April 2, California Association Of Realtors will launch a new program designed to provide peace of mind to first-time buyers who are hesitant to enter the housing market due to concerns about potential job loss, and subsequently being unable to meet their monthly mortgage obligations.

Through the C.A.R. Housing Affordability Fund Mortgage Protection Program (C.A.R.H.A.F. MPP), first-time home buyers who lose their jobs due to layoffs may be eligible to receive up to $1,500 per month for up to six months to help make their mortgage payments. A qualified co-buyer also can participate in the program, for a reduced monthly benefit of $750 per month for up to six months in the event of a job loss. Program benefits also include coverage for accidental disability and a $10,000 death benefit. C.A.R.'s Housing Affordability Fund is dedicating $1 million to the program this year, and estimates that as many as 3,000 families will benefit from the program throughout 2009.

To qualify for the Mortgage Protection Program, applicants must:
. Be a first-time home buyer - someone who has not owned a home in the last three years
. Open escrow April 2, 2009, or later, and close on or before Dec. 31, 2009
. Use a California REALTOR® in the transaction
. Purchase the property in California
. Be a W-2 employee (cannot be self-employed or military personnel)

First-time home buyers must request an application for the H.A.F. Mortgage Protection Program from their REALTOR®

The new state budget contains a $10,000 tax credit for buyers of new homes in California. Here are some highlights:

· Applies to new, never-occupied houses and condos bought between March 1, 2009, and March 1, 2010.

· It is for 5 percent of purchase price or $10,000, whichever is lower.

· It is for both first-time buyers and move-up buyers.

· Limit is one. This is not for investors.

· Buyer must live in the home for two years to receive the credit.

· Buyers will get $3,333 off their taxes starting in the year of purchase, and $3,333 in each of two years afterward.

· There are no income limitations for the buyer.

· The tax credit does not have to be repaid (unless buyer sells or rents out home before two years).

· There is a $100 million limit statewide on this tax credit. First come, first served.

· If you are a first-time buyer, this $10,000 state credit can be combined with new $8,000 federal tax credit for first-time homebuyers.

· Some details are still murky. It is not clear if the March 1 start date applies to date of contract or close of escrow. If you are in the middle of a deal, check with builder's sales agent.

Source: State Senate, California Building Industry Association

Check more details on http://www.sacbee.com/business/story/1641603.html

Fannie Mae and Freddie Mac are both toughening their credit score and down-payment rules as of April 1.

In response, major lenders are already factoring in the higher fees, which reduces the effectiveness of the stimulus efforts.

Under the new guidelines, buyers with down payments of less than 25 percent will be charged a three-quarter point add-on penalty, no matter how high their credit score.

Buyers of duplexes, where one unit is owner-occupied and the other is rented, will be charged a 1 percent add-on.

Refinancers who take cash out will be charged as much as three points if they have a low to moderate equity stake.

Freddie spokesman Brad German says the loan categories and credit risk combinations targeted by these fees "default at four to eight times" the rate of other mortgages backed by Freddie. "We have to manage these risks appropriately," he says.

Source: Washington Writers Group, Kenneth R. Harney (02/15/2009)

President Obama announce his plan for forclosure mitigation a few minutes ago. One of the provisions in the new plan is to allow home owners who are under water, to refinance thier mortgages. What this means is that even if your home is worth less than the amount of Mortgage on it, you will still be able to refinance your mortage into a 30 or 15 year fixed rate loan at current mortage rates. This will be effective in 2 weeks from now.
This will come as a big releif to a large number of home owners who have been making all their payments on time, but have been feeling the pain of not being able to refinance at the current historic low rates.

Some people say TLC means Tender Love Care. I call it "Time Labor and Cost". Please express your views on what this acronym should be called.