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In prior blogs, I have mentioned that changes are coming to FHA Loans....

Now it looks like some of these changes are a done deal.

They include:

*Mortgage insurance fees will increase from 1.75% to 2.25%.
*Seller concessions will also be reduced from 6% to 3%

When will you see these changes come into effect?

*The upfront MIP increase will become effective with all FHA loans assigned from April 5, 2010 and beyond.
*There is no official word on when the seller concession change will start.

Are You Looking For a New Home for a GREAT Price?

The Lakes at Brookside, in Warrenton,  are introducing three spectacular new homes.  

They include:  

The Brighton-From $339,990-Offers 3-4 bedrooms and 2-3 baths.

The Ravenna-From $364,990-Offers 2,650-3,838 sq.ft. and up to 5 bedrooms

The Verona-From $379,990-Offers 2,822-4,133 sq.ft.  and up to 6 bedrooms

These homes are a great value and  located in the Gainesville area.   This community features, lakeside living and resort-style amenities which include:

*4 Gorgeous Spring Fed Lakes

*2 Pools and Clubhouse Complexes

*Community Walkways and Trails

*Tennis and Basketball Courts

*Future Lakeside Promenade with Shops    

Please let me know if you have any questions about The Lakes at Brookside.   I am given weekly incentives to pass onto my buyers from new home communities.   Until 1/10/10 Ryan Homes will give new purchasers $10,000 towards options or closing costs!   Certain restrictions do apply, so if you have any questions give me a call.

What You Will NOT Find in Your Lender’s New GFE

*Sales Price

*Earnest Down Payment

*Property Taxes Due at Closing


*Builder/Seller/Realtor Credits

*Cost breakdowns (HUD requires all title fees to be bundled and all origination fees to be bundled as well; some of these are broken down on the new HUD-1)

*Yield spread premium/discount points…..(These are disclosed on the new GFE, but this terminology is not used.     Instead, YSP is called a “credit” and discount points are called a “charge”.

*Prepaid finance charges….This is important because this can help in computing the annual percentage rate.

*Cash to Close.

 All of the above information could typically be found on Good Faith Estimate forms that have been used for the last 30 years.  

The NEW Good Faith Estimate

Beginning January 1, 2010, lenders will be providing new good faith estimates to their borrowers.   The new GFE is another step by the federal government to hold lenders accountable.      

The changes have been designed to make the loan process more transparent for the borrower.  

In short, this new  national  reform should:

*Provide more timely and effective disclosures regarding settlement costs for consumers.  

*Provide a shopping tool for consumers.  

*Restrict or eliminate unjustified increases in settlement costs between the GFE and the HUD-1.  

*Force lenders to better manage and anticipate settlement costs, including third party fees.

*Prohibit intentional low-balling of  good faith estimates.

Federal Housing Administration New Proposals

 *There is talk about raising a buyer’s down-payment from 3.5% to 5%.   Of course, this is just being considered, but this could signal things to come.

 *FHA is also considering lowering allowable seller concession to 3%.   This would be down from 6% which is what’s allowed in today’s market.

 *There is also speculation that the FHA is interested in raising their mortgage premiums.    

Frequently Asked Questions about the Homebuyer Tax Credit

NAR Frequently Asked Questions

Homebuyer Tax Credit Changes

National Association of REALTORS ® Government Affairs Division

500 New Jersey Avenue, NW, Washington DC, 20001

Here are some of the most frequently asked questions on the changes to the Homebuyer Tax Credit

Question: Existing homeowner credit: Must the new house cost more than the old house?

Answer: No. Thus, for example, individuals who move from a high cost area to a lower cost area who

meet all eligibility requirements will qualify for the $6500 credit.


Question: I am an existing homeowner. On October 25, 2009, I signed a contract to purchase a

new home. I have lived in my current home for more than 5 consecutive years and

am within the new income limits. I will go to settlement on November 20. If

President Obama has signed the bill by the time I go to settlement, will I qualify for

the new $6500 tax credit?

Answer: Yes. The existing homeowner credit goes into effect for purchases after the date of enactment

(when the bill is signed). There is no reference to the date of contract for the new credit. The

provision looks solely to the date of purchase, which is generally the date of settlement.


Question: I am a firsttime

homebuyer but was not within the prior income limits at the time I

entered into my contract to purchase on October 30, 2009. I will be covered,

however, by the new income limits. If the new rules have been signed into law by the

time I go to settlement, will I be eligible for a credit?

Answer: Yes. The new income limitations go into effect as soon as the President has signed the bill.

The income limit and other eligibility rules will look to your status as of the date of purchase,

which is the settlement date. So if the new rules have been signed when you go to settlement,

you should be eligible for the credit (or a portion of the credit if you’re within the phaseout



Question: I am an eligible existing homeowner. I have a fair amount of equity in my home. I

have found a home with a nonnegotiable

price of $825,000. Will I be able to use any

of the $6500 tax credit?

Answer: No. The $800,000 cap on the cost of the purchased home is firm at $800,000. Any amount

above $800,000 makes the home ineligible for any portion of the credit. The $800,000 is an

absolute ceiling.


Question: I owned my home for 10 years, but sold it two years ago year and have been renting

since. If I purchase a home, will I be eligible for the $6500 tax credit if I meet all the

other eligibility tests?

Answer: Yes. Because you lived in the home for more than 5 consecutive years of the previous 8, you

will qualify for the $6500 credit. For example, Say John and his wife bought a home in 2000

and lived there until 2008 when he got a divorce. Whether John has been renting or bought in

the interim, he WOULD INDEED be eligible for the credit because he owned a home and

occupied it as his principal residence for 5 consecutive years out of the last 8 years. The

keyword here is “consecutive.” As long as he lived in that house for 5 years straight what he

did since 3 years doesn’t impact eligibility.


Question: I am an eligible firsttime

homebuyer. I entered into a contract to purchase on

November 1, 2009. Do I have to go to closing before December 1? How does the

extension date affect me?

Answer: You do not have to close before December 1. Once the legislation has been signed, it will be as

if the Nov 30 date had never existed. Therefore, so long as the contract settles before April 30

(or July 1, worst case), the purchaser will be eligible for the credit.

Tax Credit Extension…Are You Eligible?

 As you know, the tax credit has now been extended and now includes the opportunity to enable more buyers to take advantage of this government stimulus plan.     Below, is a brief summary of what is included in the plan.

  • The $8,000 tax credit for first-time buyers has been extended through April 30, 2010.   Time has been alotted to allow on settling on your new home.   Buyers must have a ratified contract by April 30, 2010, and will have until June  30, 2010 to settle.  

  • If you are a current homeowner and want to buy, you could also be eligible for a $6,500 tax credit through April 30, as long as you have lived in the home that you are selling as a principal residence for five consecutive years out of the last eight years.


  • Income limits for buyers who qualify were also increased.   ($125,000 for single buyers and $225,000 for couples)

First-Time Homebuyer Tax Credit will be Extended = Great News for Buyers and Sellers!

Today, the House of Representatives voted 403-12 in favor of extendingthe first-time home-buyer tax credit.   It will be extended through April 30, 2010. Yesterday the Senate voted  98 to 0 in favor of the extension.  

It has been reported that President Obama  will sign the Dodd-Lieberman-Isakson amendment which includes the  bill’s extension   and expands the federal tax credit for first-time home-buyers. The amendment extends the tax credit through April 30, 2010.

The President  is planning on signing  the amendment as soon as tomorrow.  

I will have more information on this bill in the coming days.  

Carriage Home Coming Soon! It is a traditional sale in Braemarl!!

We get calls everyday from buyers looking for traditional sales in the Bristow area!   Braemar is one of many incredible neighborhoods in Bristow.   If you have any interest in a traditional sell, carriage home, in Braemar, please let me know.   There will be one coming on the market very soon at an incredible price, and yes it is a traditional sale.

Is it still a good time to buy? YOU BET!

It continues to be an excellent time to purchase a home. There are many factors that work in favor of homebuyers, both those looking to make their first home purchase and those seeking to move up into a larger home.In recent weeks, there have been many indicators pointing to an improving real estate market, so buyers should act now while conditions remain ideal.Consider these reasons why now is a good time to buy a home:

  • Housing affordability remains high.This allows buyers to purchase a bigger home, or one in a better location, than they might have in the past.
  • The number of homes on the market has started to decrease. Yet, homebuyers still have a wide variety of homes to choose from, making it more likely they will find their dream home.
  • Mortgages are at historically low levels, and some buyers are even able to get 30-year fixed rates below 5 percent. Low mortgage rates also positively impact affordability and allow buyers to enjoy lower mortgage payments for the lifetime of their loan. This may be of particular interest to renters whose rent payments typically rise each year.

Market Conditions

Our market is still holding strong.     Inventory is way down!   Our buyers are scrambling to find a home that is a traditional sell or even a foreclosure!   There are still plenty of short-sales, but as you  know by now, they can be a huge risk!  

Consumers are busy buying houses, according to the National Association of Realtors (NAR), which announced this week that its Pending Home Sales Index rose 6.4 percent in August to its highest level since March 2007. The uptick in pending home sales marked the seventh consecutive monthly increase, the longest in the series of the index which began in 2001.A forward-looking indicator based on contracts signed to purchase a home, the Pending Home Sales Index in the Northeast jumped 8.2 percent from July and is 12 percent higher than August 2008.  

Conditions remain ideal for purchasing a home. Freddie Mac’s Primary Mortgage Market Survey showed that rates on 30-year fixed-rate mortgages are averaging less than 5 percent and nearing the all-time low set in March. In addition, first-time buyers still have a few weeks to get under contract in time to take advantage of the $8,000 buyer tax credit.