Wanda Promes

House and Senate conferees completed work on final elements of the stimulus legislation early this morning. I want to provide a synopsis to provide an overview of what is in the final legislative package, specifically as it relates to the housing community. I hope this is beneficial information for potential new homeowners, Realtors and other Mortgage Lenders.

House and Senate conferees have agreed upon a compromise stimulus package at a total cost of $789 billion. The House is scheduled to vote on the package today (Friday, Feb 13th) and the Senate will follow suit shortly thereafter, with expectations that the legislation will reach the President's desk by Monday, Feb. 16.

There are several provisions in the overall stimulus package that will be beneficial for many of us, and help stimulate demand for housing.

Chief among these is an $8,000 home buyer tax credit for new home buyers. While we are disappointed and would have preferred a more enhanced tax credit like the Senate version, the conferees did retain some key elements from the Senate and made other modifications that are beneficial to home buyers and home builders. For qualified home purchases in 2009, the legislation:

•· Stipulates that the $8,000 tax credit does not have to be repaid, unlike the tax credit passed last summer; currently this is a $7,500 refund for New homeowners and has to be repaid at the rate of $500 per year over 15 years.

•· Keeps the tax credit refundable, or claimable regardless of tax liability;

•· Extends the ending date of the home buyer tax credit from July 1, 2009 until Dec. 1, 2009 so that consumers can utilize it during the critical summer and fall buying months;

•· Allows tax credit home buyers to participate in the mortgage revenue bond program; currently, participants of state bond programs do not qualify for the tax credit; as SD Housing Loans as they are called here in South Dakota

•· Permits state housing finance agencies to help buyers at closing by advancing the credit amount as a loan using tax-exempt bond proceeds;

Income guidelines are $75,000 for a single person, and $150,000 for a married couple.

The tax credit applies to the homebuyer whom has not owned a property in the last 3 years.

This is only a first step in stimulating the housing economy, and I feel, that along with a little better consumer confidence in the job market, this will be effective in spurring new home purchases in 2009.

It is my hope that we will see more folks taking advantage of this new tax break and step out to purchase homes again!

It would also be my hope that we will see interest rates stay low, at least for the next year to help move this entire stimulus bonus for new homeowners along and make it look even more attractive.

I am so glad, that at this time of year, I have seen so many express their Thanks, for what they have, for who they have, for who they are. Thanksgiving, a time to reflect, look inside ourselves. The spirit of this season naturally brings an intraspect to life. Perhaps one positive result to tougher economic times is that people take the time to reflect what is important in their lives. Happy Thanksgiving to all. Peace, Happiness, and Laughter be yours.

Rolling with the changes in Home Financing

Our world is much different than it was 20 to 50 years ago when our parents were busy blazing a trail to the American Dream, and Home Financing is no exception to the changes. With swings in the Economy and Real Estate market in America, the Information Highway coming of age, and the shift in the Socio Economic makeup of our Consumer, Banks and Finance Companies are on a fast paced road to stay abreast of the demands of Home Buyers and competition in the industry.

Remember when our parents had one job, one car, a savings account, Mom stayed home, and one of their biggest financial goals was to pay off the mortgage? They knew Social Security was going to provide some retirement as well as the employer they had been working for the last 30-40 years. That has all changed. In most families today, both parents work, or a single parent juggles the household, sometimes with more than one job; we have two cars, credit card debt, and little savings. Most of us will have a mortgage when we retire, we will have changed jobs 7 times with retirement funds being uncertain.

Consider all the options you now have with Home Financing. Our parents went to their local home town Bank or local Savings and Loan to obtain a mortgage. They did business with their banker on not much more than a handshake. We now have options to go to our local lenders; Banks, Credit Unions, Brokerages; or shop online for our Mortgages. The mortgage products have changed as well. In addition to the traditional Mortgages of old, we can choose an Adjustable Rate Mortgage, Fixed Rate 30, 40 or 50 year Mortgage, Payment Option Mortgage and Equity Loans.

Most of us will stick with someone whom has served us well in the past or whom has been referred to us from a trusted friend or advisor. It may pay to shop around for the best deal. Be cautious of online companies whom you don't know a lot about and don't have to face you at the closing table when things do not go as expected. Many consumers may find that fees or rates were not disclosed accurately or find there are ‘hidden' costs in the incredible offer that was made to you over the phone or the internet. Sitting down with a loan officer you trust and visiting various Mortgage Financing Options makes a lot of sense when it comes to developing financial goals. There are so many products that can help you achieve those various goals.

Take the time to sit down with your lender to discuss your needs. Did you know there are various programs for Teachers and Public Workers? Has anyone offered to help you repair your credit or simply help raise your credit score? Has anyone talked with you about various Mortgage Insurance Options or Secondary financing? Did you know that there is money available for down payment assistance? As a self employed person, have you reviewed your business plan and considered how your mortgage is financed to help you meet your long term objectives?

Ask your Mortgage Professional to explain and explore your options. Consider your financial goals when choosing a Mortgage product and understand industry standards when shopping fees and rates. Work with a local lender and with someone whom has your best interests in mind.