The Obama administration is considering spending up to $100 billion of the Treasury Department's $700 billion Troubled Asset Relief Program to ease the crisis. Many members of Congress are also urging the president to do the same.
Under the FDIC's plan, banks would modify mortgage loans, while Uncle Sam would use TARP dollars to absorb some of the losses. And it's got promise because a version of it is already being used with some success to handle troubled mortgages originated by IndyMac.
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Wednesday, January 28, 2009
Sunday, January 25, 2009
Housing Price Forecasts Illinois and Chicago MSA, December 2008
The Housing Market
The news that the National Bureau of Economic Research had confirmed that the US
economy entered into a recession in December 2007 was amplified by the announcement that
the economy shed 533,000 jobs in November. The two news events dampened any lingering
hope that the economic downturn would be short-lived. However, the Fed dropped interest
rates such that fixed-term mortgage rates are now below 5% in many markets; the
combination of lower interest rates and a major infrastructure investment program that is
anticipated from the Obama administration offer the best hope for some turnaround in the
housing market in the next year.
Source:
Regional Economics Applications Laboratory,
Institute of Government and Public Affairs
University of Illinois
December 21, 2008
The news that the National Bureau of Economic Research had confirmed that the US
economy entered into a recession in December 2007 was amplified by the announcement that
the economy shed 533,000 jobs in November. The two news events dampened any lingering
hope that the economic downturn would be short-lived. However, the Fed dropped interest
rates such that fixed-term mortgage rates are now below 5% in many markets; the
combination of lower interest rates and a major infrastructure investment program that is
anticipated from the Obama administration offer the best hope for some turnaround in the
housing market in the next year.
Source:
Regional Economics Applications Laboratory,
Institute of Government and Public Affairs
University of Illinois
December 21, 2008
Saturday, January 24, 2009
Thursday, January 22, 2009
First-Time Homebuyer Credit Information Center
Congress recently approved a tax credit for first-time homebuyers that can be worth up to $7,500. The credit, however, acts more like a no-interest loan because it must be repaid to the government over 15 years.
The First-Time Homebuyer Credit can be claimed on Form 5405, which is filed with your 2008 or 2009 federal tax return.
IRS Notice 2009-12 has instructions for non-married persons who co-own a house and want to take the credit.
The First-Time Homebuyer Credit can be claimed on Form 5405, which is filed with your 2008 or 2009 federal tax return.
IRS Notice 2009-12 has instructions for non-married persons who co-own a house and want to take the credit.
Highlights of 2008 Tax Law Changes: Tax Breaks Renewed, Recovery Rebate Credit, Homeowner Relief
FS-2009-1, January 2009
AMT exemptions rise; several expiring deductions and credits get a new lease on life; a new standard property tax deduction and a special first-time homebuyer credit are available to some homeowners; and retirement savings incentives expand. These are among the changes taxpayers will find when they fill out their 2008 tax returns. More information about these and other changes, summarized below, can be found on IRS.gov and in various IRS documents, including the Instructions for Form 1040.
AMT exemptions rise; several expiring deductions and credits get a new lease on life; a new standard property tax deduction and a special first-time homebuyer credit are available to some homeowners; and retirement savings incentives expand. These are among the changes taxpayers will find when they fill out their 2008 tax returns. More information about these and other changes, summarized below, can be found on IRS.gov and in various IRS documents, including the Instructions for Form 1040.
Special Web Section Unveiled for Homeowners Who Lose Homes; Foreclosure Tax Relief Available to Many
WASHINGTON — The Internal Revenue Service unveiled a special new section today on IRS.gov for people who have lost their homes due to foreclosure. The IRS also reassured homeowners that, although mortgage workouts and foreclosures can have tax consequences, special relief provisions can often reduce or eliminate the tax bite for financially strapped borrowers who lose their homes.
The new section of IRS.gov includes a variety of information, including a worksheet designed to help borrowers determine whether any of the foreclosure-related relief provisions apply to them. For those taxpayers who find they owe additional tax, it also includes a form they can use to request a payment agreement with the IRS. . In some cases, eligible taxpayers may qualify to settle their tax debt for less than the full amount due using an offer-in-compromise.
The IRS urges struggling homeowners to consider their options carefully before giving up their homes through foreclosure.
The new section of IRS.gov includes a variety of information, including a worksheet designed to help borrowers determine whether any of the foreclosure-related relief provisions apply to them. For those taxpayers who find they owe additional tax, it also includes a form they can use to request a payment agreement with the IRS. . In some cases, eligible taxpayers may qualify to settle their tax debt for less than the full amount due using an offer-in-compromise.
The IRS urges struggling homeowners to consider their options carefully before giving up their homes through foreclosure.
Mortgage Workouts, Now Tax-Free for Many Homeowners; Claim Relief on Newly-Revised IRS Form
Updated with FAQs at bottom — Feb. 28, 2008Updated with new link — Dec. 11, 2008
IR-2008-17, Feb. 12, 2008
WASHINGTON — Homeowners whose mortgage debt was partly or entirely forgiven during 2007 may be able to claim special tax relief by filling out newly-revised Form 982 and attaching it to their 2007 federal income tax return, according to the Internal Revenue Service.
Normally, debt forgiveness results in taxable income. But under the Mortgage Forgiveness Debt Relief Act of 2007, enacted Dec. 20, taxpayers may exclude debt forgiven on their principal residence if the balance of their loan was less than $2 million. The limit is $1 million for a married person filing a separate return. Details are on Form 982 and its instructions, available now on this Web site.
“The new law contains important provisions for struggling homeowners,” said Acting IRS Commissioner Linda Stiff. “We urge people with mortgage problems to take full advantage of the valuable tax relief available.”
IR-2008-17, Feb. 12, 2008
WASHINGTON — Homeowners whose mortgage debt was partly or entirely forgiven during 2007 may be able to claim special tax relief by filling out newly-revised Form 982 and attaching it to their 2007 federal income tax return, according to the Internal Revenue Service.
Normally, debt forgiveness results in taxable income. But under the Mortgage Forgiveness Debt Relief Act of 2007, enacted Dec. 20, taxpayers may exclude debt forgiven on their principal residence if the balance of their loan was less than $2 million. The limit is $1 million for a married person filing a separate return. Details are on Form 982 and its instructions, available now on this Web site.
“The new law contains important provisions for struggling homeowners,” said Acting IRS Commissioner Linda Stiff. “We urge people with mortgage problems to take full advantage of the valuable tax relief available.”
IRS Speeds Lien Relief for Homeowners Trying to Refinance, Sell
IR-2008-141, Dec. 16, 2008WASHINGTON — The Internal Revenue Service today announced an expedited process that will make it easier for financially distressed homeowners to avoid having a federal tax lien block refinancing of mortgages or the sale of a home.
If taxpayers are looking to refinance or sell a home and there is a federal tax lien filed, there are options. Taxpayers or their representatives, such as their lenders, may request that the IRS make a tax lien secondary to the lien by the lending institution that is refinancing or restructuring a loan. Taxpayers or their representatives may request that the IRS discharge its claim if the home is being sold for less than the amount of the mortgage lien under certain circumstances.
If taxpayers are looking to refinance or sell a home and there is a federal tax lien filed, there are options. Taxpayers or their representatives, such as their lenders, may request that the IRS make a tax lien secondary to the lien by the lending institution that is refinancing or restructuring a loan. Taxpayers or their representatives may request that the IRS discharge its claim if the home is being sold for less than the amount of the mortgage lien under certain circumstances.
Monday, January 19, 2009
Downtown deals and housing downturn allow renters to go upscale
With an abundance of empty apartments, renters are negotiating their way into premium buildings.
The good times for renters are likely to continue, since more high-end apartments are on the way. Last month, M&R Development broke ground on Parc Huron, a 221-unit luxury apartment building in River North that originally was to be developed by Lennar Corp. as condos. Other buildings on tap, many in River North, are expected to add almost 2,500 rental units to the market next year.
The supply of condos available for rent is expected to increase too. Investors who bought condos at pre-construction prices a few years ago and planned to resell them are finding their plans quashed by higher down payment requirements and the credit market's meltdown. Personal circumstances are forcing other owners to abandon their plans for a second home in the city. And buyers who planned to use them as rental properties are finding themselves having to deal, given the competition. Just along the Gold Coast, there are 64 condo properties that have been on the rental market for at least 180 days.
The good times for renters are likely to continue, since more high-end apartments are on the way. Last month, M&R Development broke ground on Parc Huron, a 221-unit luxury apartment building in River North that originally was to be developed by Lennar Corp. as condos. Other buildings on tap, many in River North, are expected to add almost 2,500 rental units to the market next year.
The supply of condos available for rent is expected to increase too. Investors who bought condos at pre-construction prices a few years ago and planned to resell them are finding their plans quashed by higher down payment requirements and the credit market's meltdown. Personal circumstances are forcing other owners to abandon their plans for a second home in the city. And buyers who planned to use them as rental properties are finding themselves having to deal, given the competition. Just along the Gold Coast, there are 64 condo properties that have been on the rental market for at least 180 days.
Chicago to receive $55 million federal grant to battle foreclosure fallout
Chicago will receive more than $55 million from the federal government to combat the impact of foreclosures on city neighborhoods, more money than just about any other city in the country.
Also announced was the approval of plans worth several million dollars each from Elgin, Joliet, and Lake and Will Counties for federal money to combat blight.
Also announced was the approval of plans worth several million dollars each from Elgin, Joliet, and Lake and Will Counties for federal money to combat blight.
Friday, January 16, 2009
Foreclosure Activity Increases 81% in 2008
RISMEDIA, January 15, 2009-RealtyTrac®, a leading online marketplace for foreclosure properties, today released its 2008 U.S. Foreclosure Market ReportTM, which shows a total of 3,157,806 foreclosure filings - default notices, auction sale notices and bank repossessions - were reported on 2,330,483 U.S. properties during the year, an 81% increase in total properties from 2007 and a 225% increase in total properties from 2006. The report also shows that 1.84% of all U.S. housing units (one in 54) received at least one foreclosure filing during the year, up from 1.03% in 2007.
Thursday, January 15, 2009
The world's 2008 housing markets in review and some forecasts for 2009
The Global House Price Slump
In 2008, the crash of the world’s housing markets, which began in the US in 2007, precipitated the world’s most severe economic crisis since the Great Depression.
Inflation-adjusted house prices fell in more than 21 countries out of the 29 for which Q3 figures are available. In no country is there cause for strong optimism. The latest quarterly figures bring grim news, even in countries which recently saw price rises.
In 2008, the crash of the world’s housing markets, which began in the US in 2007, precipitated the world’s most severe economic crisis since the Great Depression.
Inflation-adjusted house prices fell in more than 21 countries out of the 29 for which Q3 figures are available. In no country is there cause for strong optimism. The latest quarterly figures bring grim news, even in countries which recently saw price rises.
Quick FHA Program Guide
Quick list of types of FHA mortgages and types of homes to purchase or improve through FHA program.
FHA Toolkit available
FHA guidelines to change a bit in 2009. Among the changes, the buyer’s entire cash investment—as little as 3.5 percent—can be a gift from a family member, employer, charitable organization or local government entity. According to NAR, "FHA is interpreting this to mean a 3.5 percent down payment (not including closing costs)."
Is There Still Hope for Housing?
RISMEDIA, January 14, 2009-(MCT/RISMedia)-President-elect Barack Obama asked the Bush administration on Monday for the remaining $350 billion in Wall Street rescue money, hoping to have the funds available for use when he takes office next week while Congress wrestles with what’s sure to be the largest economic stimulus program in the nation’s history.
Bill Aims to Stabilize Housing, Stem Foreclosures
H.R. 384, The TARP Reform and Accountability Act, was offered by Rep. Barney Frank (D-Mass.), chair of the House Financial Services Committee. The bill would require the Treasury Department to develop a program, outside the Troubled Asset Relief Program, to stimulate demand for home purchases and lower property inventories, by making affordable mortgages available for qualified buyers through interest rate buydowns, a priority of the NATIONAL ASSOCIATION OF REALTORS®.