Grant Hickman

he amount of damage to a credit score caused by foreclosure, deed in lieu or a short sale during 2008 and 2009 may be mitigated by the slower economic times, say some credit and legal experts.

FICO may have to adjust its credit scores to lessen the impact of a foreclosure in the last two years, says Todd J. Zywicki, a professor of law at George Mason University.

''It just seems obvious that a foreclosure in 2008 or 2009 doesn't have as much information value as a foreclosure five years ago,'' he says. ''To the extent that foreclosure doesn't predict future behavior as much as it did in the past, you'd expect that the FICO algorithm would change to adjust for that.''

One of the country’s largest credit unions Golden 1 has already figured out a way to lend to people with a foreclosure on their record by offering a mortgage repair loan specifically for those who have lost a home to foreclosure and who want to buy a new one.

BECU, another large credit union based in Washington State, is about to present a program to fellow lenders, ''How to Lend to the Newly Credit Impaired.”

Source: The New York Times, Ron Lieber (03/14/2009)

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Model homes are important tools for builders because they help buyers fall in love with a home.

Phyllis Ryan, president of the model-home division of Interior Concepts, a Maryland design firm that specializes in furnishing new homes, has some tips that might benefit anyone who is selling a home.

• A stylish kitchen appeals to many buyers. If a sellers has upgraded cabinets and granite countertops, that’s good. If they don’t, it may help to display some stylish touches like an espresso machine, a retro toaster or just some luscious fruit.
• Lots of light makes spaces feel larger. Turn on all the lights even during the day and add a few extra lights if necessary.
• The master bedroom should seduce a buyer. Play soft jazz, pile the bed high with a cushy comforter and pillows. Stack plush towels in the bathroom.
• Add drama to a bottleneck or a dead end space. Prop an oversize mirror against the wall. It visually ops a space and adds drama.

Source: Washington Post, Elizabeth Razzi (03/14/2009)

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Freddie Mac reports a drop in the 30-year fixed mortgage rate to 4.98 percent during the week ended March 19 from 5.03 percent the prior year, marking the lowest rate since 4.96 percent in mid-January.

Experts say rates could fall further in response to the Federal Reserve's announcement that it will add $1.2 trillion to the economy to alleviate the credit crisis.

Source: Tulsa World (Okla.) (03/20/09)

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The real estate market has really started to rally and part of that success can be attributed to the new Housing Tax Credit for first-time homebuyers.

Under the American Recovery and Reinvestment Act of 2009, qualifying taxpayers who purchase a home before Dec. 1 receive up to $8,000 or $4,000 for married individuals filing separately. People can claim the credit either on their 2008 tax returns due April 15 or on their 2009 tax returns next year.

For people who recently purchased a home or are considering buying in the next few months, there are several different ways that they can get this tax credit even if they've already filed their tax return.

The filing options to consider are:

• File an extension - Taxpayers who haven't yet filed their 2008 returns but are buying a home soon can request a six-month extension to October 15. This step would be faster than waiting until next year to claim it on the 2009 tax return. Even with an extension, taxpayers could still file electronically, receiving their refund in as few as 10 days with direct deposit.
• File now, amend later - Taxpayers due a sizable refund for their 2008 tax return but who also are considering buying a house in the next few months can file their return now and claim the credit later. Taxpayers would file their 2008 tax forms as usual, then follow up with an amended return later this year to claim the homebuyer credit.
• Amend the 2008 tax return - Taxpayers buying a home in the near future who have already filed their 2008 tax return can consider filing an amended tax return. The amended tax return will allow them to claim the homebuyer credit on the 2008 return without waiting until next year to claim it on the 2009 return.
• Claim the credit in 2009 rather than 2008 - For some taxpayers, it may make more financial sense to wait and claim the homebuyer credit next year when they file the 2009 tax return rather than claiming it now on the 2008 tax return. This could benefit taxpayers who might qualify for a higher credit on the 2009 tax return. This could include people who have less income in 2009 than 2008 because of factors such as a job loss or drop in investment income.

The IRS reminds taxpayers the amount of the credit begins to phase out for taxpayers whose modified adjusted gross income is more than $75,000, or $150,000 for joint filers. Taxpayers can claim 10 percent of the purchase price up to $8,000, or $4,000 for married individuals filing separately.

IRS.gov provides more information, including guidance for people who bought their first homes in 2008. To learn more about the overall implementation of the Recovery Act, visit www.Recovery.gov.

As always, consult with your tax adviser if you have any questions about the Housing Tax Credit and which option would be best for your situation.

30 Year Fixed 5.00% with 0 points and only $399 in lender fees
MHDC (CAL) FHA 30 Year Fixed 6.31% with 0 points
FHA 30 Year Fixed 5.00% with 0 points and only $399 in lender fees

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• April 1: Heat Smart Safe Start: Helmet Fittings for Kids, Lake St. Louis Civic Center 4-6 p.m. -- Free
• April 3: Flashlight Egg Hunt for 21 and older at Civic Hall at 7:30 p.m. - Admission
• April 3: Flashlight Egg Hunt for 11-14 at Rotary Park Lower Pavilion at 7 - 9 p.m.
• April 3-5: Missouri Tartan Day Festivities, Frontier Park
• April 3-5: St. Charles Home Show, Saint Charles Convention Center; Friday & Saturday 11am-9pm & Sunday 11-5pm -- Free
• April 11: Easter Egg Hunt for newborns to 12 years old and and extreme hunt for 12- 18 year olds at Youth Activity Park, 10 a.m. for $5.00
• April 15: Paws on Parade Walk, Quail Ridge Park 8:30 - 11 a.m. -- Free
• April 18: Plein Air Painting for Kids ages 5-12, St. Peters City Centre Park, Saturday 1-3 pm --Free
• April 18: Annual Spring City Wide Yard Sale starting at 7 am in Wentzville
• April 22- May 3: Augusta Plein Air Art Event
• April 24-26: Spring ArtWalk, Main Street and Foundry Art Centre
• April 25 - 26: Earth & Arbor Day, Shop St. Peters, Crafts, games, prizes, activities Saturday 10 am - 4 pm Sunday 11 am - 3 pm -- Free
• April 25: New Town Blues Festival, New Town Outdoor Ampitheater 6:00 PM
• April 25: Riverlands Environmental Demonstration Area, 10 am-4 pm, free with some fees for off-site birding trips

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