The Internal Revenue Service today announced its first successful prosecution related to fraud involving the first-time homebuyer credit and warned taxpayers to beware of this type of scheme.
On Thursday July 23, 2009, a Jacksonville, Fla., tax preparer, James Otto Price III, pled guilty to falsely claiming the first-time homebuyer credit on a client’s federal tax return. Price faces the possibility of up to three years in jail, a fine of as much as $250,000, or both.
To date, the IRS has executed seven search warrants and currently has 24 open criminal investigations in pursuit of potential instances of fraud involving the credit. The agency has a number of sophisticated computer screening tools to quickly identify returns that may contain fraudulent claims for the first-time homebuyer credit.
Full details and instructions are available on the official IRS Web site, IRS.gov. See: http://www.irs.gov/newsroom/article/0,,id=204671,00.html
Friday, July 31, 2009
Federal clunker program on hold
Federal clunker program on hold. Through late Wednesday, 22,782 vehicles had been purchased through the program and nearly $96 million had been spent. But dealers raised concerns about large backlogs in the processing of the deals in the government system, prompting the suspension. A survey of 2,000 dealers by the National Automobile Dealers Association found about 25,000 deals had yet to be approved by NHTSA, or nearly 13 trades for each store.
Thursday, July 30, 2009
The Truth about Cell Phones and the Do Not Call Registry
The truth about cell phones and the DNC Registry is:
•Contrary to the e-mail, cell phone numbers are NOT being released to telemarketers, and you will NOT soon be getting telemarketing calls on your cell phone.
•There is NO deadline by which you must register your cell phone number on the Registry.
•Federal Communications Commission (FCC) regulations prohibit telemarketers from using automated dialers to call cell phone numbers. Automated dialers are standard in the industry, so most telemarketers are barred from calling consumers on their cell phones without their consent.
•The national associations representing telemarketers have stated that their clients do not intend to start calling consumers’ cell phones.
•There is only ONE DNC Registry. There is no separate registry for cell phones.
•The DNC Registry accepts registrations from both cell phones and land lines. You must call from the phone number that you want to register. If you register online, you must respond to a confirmation e-mail.
•While the telecommunications industry has been discussing the possibility of creating a wireless 411 directory, according to the FCC, even if a wireless 411 directory is established, most telemarketing calls to cell phones would still be illegal, regardless of whether the number is listed on the federal government’s National Do Not Call Registry.
For More Information
To learn more about the National DNC Registry and the rules that enforce it, visit the FTC at www.ftc.gov or the FCC at www.fcc.gov. For more information about a planned “wireless 411” directory, visit http://www.iq411.com/wireless411/index.shtml.
•Contrary to the e-mail, cell phone numbers are NOT being released to telemarketers, and you will NOT soon be getting telemarketing calls on your cell phone.
•There is NO deadline by which you must register your cell phone number on the Registry.
•Federal Communications Commission (FCC) regulations prohibit telemarketers from using automated dialers to call cell phone numbers. Automated dialers are standard in the industry, so most telemarketers are barred from calling consumers on their cell phones without their consent.
•The national associations representing telemarketers have stated that their clients do not intend to start calling consumers’ cell phones.
•There is only ONE DNC Registry. There is no separate registry for cell phones.
•The DNC Registry accepts registrations from both cell phones and land lines. You must call from the phone number that you want to register. If you register online, you must respond to a confirmation e-mail.
•While the telecommunications industry has been discussing the possibility of creating a wireless 411 directory, according to the FCC, even if a wireless 411 directory is established, most telemarketing calls to cell phones would still be illegal, regardless of whether the number is listed on the federal government’s National Do Not Call Registry.
For More Information
To learn more about the National DNC Registry and the rules that enforce it, visit the FTC at www.ftc.gov or the FCC at www.fcc.gov. For more information about a planned “wireless 411” directory, visit http://www.iq411.com/wireless411/index.shtml.
HUD Secretary Donovan announces new FHA-Making Home Affordable loan modification guidelines
WASHINGTON - U.S. Department of Housing and Urban Development Secretary Shaun Donovan today announced the Federal Housing Administration (FHA) has implemented changes to its loan modification program to ensure consistency with the Obama Administration's Home Affordable Modification Program. By August 15, FHA borrowers will be able to significantly reduce their monthly mortgage payments by seeking a loan modification through their current mortgage company or loan servicer under the new FHA-Home Affordable Modification Program (FHA-HAMP).
Housing Market Up, First Time In 3 Years.
Why to be optimistic about the housing market, with Robert Shiller, S&P Case-Shiller
Sam Zell on Tribune Co.: 'I suspect that, sometime between now and maybe as early as the end of the year, it will exit from bankruptcy'
A bankruptcy filing this week showed Tribune Co. earned a net income of $43.9 million on revenue of $289.7 million for the month of June. The company also continued to build up its cash coffers, generating $34.8 million to end the month with $740.5 million.
Reports from the 12 Federal Reserve Districts suggest that economic activity continued to be weak going into the summer
Most Districts indicated that the pace of decline has moderated since the last report or that activity has begun to stabilize, albeit at a low level.
Wednesday, July 29, 2009
Case-Shiller index bolsters housing hopes
The nation's housing market got its third dose of good news within a week with word that a closely tracked measure of housing prices showed its first monthly increase since summer 2006. Standard & Poor's/Case-Shiller index, which excludes many high-end properties and homes bought with riskier mortgages or cash, showed that home prices in May rose from April in 13 of the 20 cities tracked.
New loan to help first-time IL homebuyers
Home Start advances $8,000 federal tax credit to help with down payment
On July 22, the Illinois Housing Development Authority (IHDA) announced Home Start, a program offering qualified, first-time homebuyers a 30-year FHA-insured mortgage and the option of a zero-interest, short-term advance loan on their anticipated federal first-time buyer tax credit.
On July 22, the Illinois Housing Development Authority (IHDA) announced Home Start, a program offering qualified, first-time homebuyers a 30-year FHA-insured mortgage and the option of a zero-interest, short-term advance loan on their anticipated federal first-time buyer tax credit.
Illinois Home Sales Increase Significantly
Illinois Homebuyers Take Advantage of Favorable Conditions in June; Sales Up 20.8 Percent from May, Median Price Up 6.6 Percent
More sellers entered the Illinois housing market in June and buyers took advantage of low interest rates and affordable prices with double-digit sales increases marking the fifth consecutive month-to-month increase in home sales statewide and in the Chicagoland PMSA. It was the fourth monthly increase in median home sale price for the state as a whole, according to the Illinois Association of REALTORS® latest report.
More sellers entered the Illinois housing market in June and buyers took advantage of low interest rates and affordable prices with double-digit sales increases marking the fifth consecutive month-to-month increase in home sales statewide and in the Chicagoland PMSA. It was the fourth monthly increase in median home sale price for the state as a whole, according to the Illinois Association of REALTORS® latest report.
Monday, July 27, 2009
For Illinois, recession looking milder, recovery weaker
Moody’s Economy.com now foresees a 1.4% decline in gross state product for 2009, better than the 2.1% decline the Pennsylvania-based firm predicted earlier in the year. It’s also better than the 2.7% drop Economy.com forecasts for the national economy.
@ Crain's Chicago Real Estate Daily | Posted: 07/27/09 at 0400 EDST
@ Crain's Chicago Real Estate Daily | Posted: 07/27/09 at 0400 EDST
Freddie Mac turns to YouTube to help troubled homeowners
Freddie Mac posted a new video on the site that tells borrowers what financial documents they need to have available before calling a mortgage servicer. The documents will enable the mortgage servicer to determine the homeowners' eligibility for a workout and process the application, Freddie Mac representatives note. The two-minute video, available in English and Spanish, can be seen at
www.youtube.com/FreddieMacWeb
www.youtube.com/FreddieMacWeb
Home buyers have options in foreclosure-filled market
In addition to Lee County's 18.2 million, Cape Coral ($7 million) and Fort Myers ($2 million) also have received funds through the Neighborhood Stabilization Program, which seeks to mitigate the damage done by foreclosures. That’s a worthwhile goal, an effort to reduce blight and empty houses in hard-hit areas. The U.S. Department of Housing and Urban Development oversees the program and is forcing quick action. All funds must be designated by July of 2010 and spent within four years.
IHDA To Offer Home Loans
On July 22, the Illinois Housing Development Authority released details of its Home Start program.
Existing-Home Sales Rise Again
Existing-home sales rose for the third straight month in June 2009. NAR Chief Economist Lawrence Yun discusses these latest results in a July 23 press conference at NAR headquarters in Washington, D.C.
Tuesday, July 21, 2009
Foreclosures in the Millions Midway through 2009
A total of 1,905,723 foreclosure filings — default notices, auction sale notices and bank repossessions — were reported on 1,528,364 U.S. properties in the first six months of 2009, a 9 percent increase in total properties from the previous six months and a nearly 15 percent increase in total properties from the first six months of 2008, according to the latest RealtyTrac U.S. Foreclosure Market Report. The report also shows that 1.19 percent of all U.S. housing units (one in 84) received at least one foreclosure filing in the first half of the year.
Foreclosure filings were reported on 336,173 U.S. properties in June, the fourth straight monthly total exceeding 300,000 and helping to boost the second quarter total to the highest quarterly total since RealtyTrac began issuing its report in the first quarter of 2005. Foreclosure filings were reported on 889,829 U.S. properties in the second quarter, an increase of nearly 11 percent from the previous quarter and a 20 percent increase from the second quarter of 2008.
“In spite of the industry-wide moratorium earlier this year, along with local, state and national legislative action and increased levels of loan modification activity, foreclosure activity continues to increase to record levels,” noted James J. Saccacio, chief executive officer of RealtyTrac. “Unemployment-related foreclosures account for much of this increased activity, and the high number of borrowers who find themselves owing more on their mortgages than their homes’ are now worth represent a potentially significant future risk. Stemming the tide of foreclosures is a critical component to stabilizing the housing market, so it is imperative that the lending industry and the government work in tandem to find new approaches to address this issue.”
Foreclosure filings were reported on 336,173 U.S. properties in June, the fourth straight monthly total exceeding 300,000 and helping to boost the second quarter total to the highest quarterly total since RealtyTrac began issuing its report in the first quarter of 2005. Foreclosure filings were reported on 889,829 U.S. properties in the second quarter, an increase of nearly 11 percent from the previous quarter and a 20 percent increase from the second quarter of 2008.
“In spite of the industry-wide moratorium earlier this year, along with local, state and national legislative action and increased levels of loan modification activity, foreclosure activity continues to increase to record levels,” noted James J. Saccacio, chief executive officer of RealtyTrac. “Unemployment-related foreclosures account for much of this increased activity, and the high number of borrowers who find themselves owing more on their mortgages than their homes’ are now worth represent a potentially significant future risk. Stemming the tide of foreclosures is a critical component to stabilizing the housing market, so it is imperative that the lending industry and the government work in tandem to find new approaches to address this issue.”
The Illinois HOME START Loan Program
Through HOME START, qualified buyers can obtain a tax credit advance loan of up to $6,000 or 3.5 percent of the purchase price, whichever is greater. Homebuyers can repay the loan when they receive their tax credit refund. If not repaid by June 30, 2010, it will be converted to a second mortgage. IHDA is expected to release more details on HOME START soon and plans to offer informational webinars for REALTORS®. Stay tuned for more details.
Neighborhood Stabilization
Division A, Title XII of the bill provides $2,000,000,000 in additional funding for the Neighborhood Stabilization Program (NSP). The NSP was created by the Housing and Economic Recovery Act of 2008 (Public Law 110–289) to provide grants through the Community Development Block Grant program (CDBG) to states and localities to address the problems that can be created when whole neighborhoods are decimated by foreclosures. The funds can be used to purchase, manage, repair and resell foreclosed and abandoned properties. In addition, the funds can also be used by states and localities to establish financing methods for the purchase and redevelopment of foreclosed properties. After purchase the homes must be used to assist individuals and families with incomes at or below 120% of area median income. Twenty-five percent of funds must be used for households with incomes at or below 50% of area median income. By leveraging their expertise in partnership with others from both the public and private sector, Realtors® in many communities have been making important contributions to their local communities’ neighborhood stabilization programs.
Energy Efficient Housing Tax Credits & Grants
To promote green jobs and energy independence, ARRA invests significantly in efforts to make homes and buildings more energy efficient. The bill provides state and local governments with $6 billion in energy efficiency and conservation grants for energy audits, retrofits and financial incentives. Through 2010, homeowners will be able to claim a 30% tax credit (up from 10%) for purchases of new furnaces, windows and insulation. Another $5 billion will be available to modernize the nation’s electricity grid and install smart meters on homes that help to save consumers money. There is also $5 billion for weatherization assistance for low income households and $2 billion for federally assisted housing (section 8) efficiency efforts.
Looking to buy your first house in Illinois?
First-time home buyers may soon get some help with their down payment from the state of Illinois. Called the Home Start Program, the plan would allow a first-time home buyer to use up to $6,000 of the $8,000 federal tax credit, which was approved earlier this year, for a down payment on a house. The deal is only available with Federal Housing Administration loans, and borrowers need a credit score of 660 or above.
@ Peoria Journal Star | Posted: 07/21/09 at 0400 EDST
@ Peoria Journal Star | Posted: 07/21/09 at 0400 EDST
Signs of Stability: Housing Market Shows 12th Consecutive Monthly Decrease in Number of Listed Homes
The U.S. housing market continues to show signs of stabilization with a drop in the number of Multiple Listing Service (MLS)-listed homes for the twelfth consecutive month. The number of single family homes and condos listed for sale according to MLS data decreased in June 2009 from May by 2.1%, bringing the total number of active listings in 28 major U.S. markets to 696,858.
Wednesday, July 15, 2009
How the 203k FHA Loan Works???
* 203k loans allow you to FINANCE the cost of the repairs in the new loan amount. (Not to exceed 110% of the after improved value determined by the appraiser and 203k consultant) What does this mean? I buy a house for 200,000 that needs 50,000 in repairs and I can borrow the extra 50,000? Too good to be true? NOPE. That's it in a nutshell....
ok details please.........
* Down payment is basesd on the sale price PLUS the final cost of the repairs x 3.5% so for example:
Sale price is 200,000 (DO not calculate 3.5% on this) PLUS 50,000 in repairs/costs (which includes certain costs and reserves the lender will require) 250,000 x 3.5%. Down payment is $8750.00 (closing costs are separate as usual)
* Buyer will hire (lender can recommend) a HUD approved FHA 203k Consultant to go to the property with the buyer to determine the required repairs and wish list repairs.
The fee charged by the consultant can be included in the mortgage. The fee can range anywhere between $ 400 to $1200 depending on the repairs required. Please check with the consultant prior to scheduling your appointment.
*Buyer will obtain estimates from several licensed contractors for the work to be completed depending on how extensive the repairs.
Three estimates are recommended for each contractor but not necessary. The buyer can act as their own general contractor only if experienced and licensed. (FHA says experienced, but most investors require the buyer to be licensed) The contractors must provide documentation to be approved by the lender prior to approval.
The consultant will determine the "required" repairs versus the "wish list repairs". You must start with the required repairs and then move on from there for you wish list. This is an important step for the consultant and appraiser so that you don't over improve the home and exceed the comparable properties in the area.
* Once the consultant completes his report of required and wish list repairs, the lender will forward it to the appraiser for an "After Improved Value". This is where you may run into problems with OVER improving the property based on current values. Between the consultant, appraiser and buyer - the FINAL FINAL report will be tweeked to come up with a final report that the contractors will be hired to do.
* So now the file is submitted to underwriting and approved ( you need to qualify at the full amount you are borrowing of course, which may include your current mortgage payment for the home you will live in during the rehab period) and the normal steps for closing will occur.
(BIG PLUS - you can include 6 months of mortgage payments in the new loan amount since it's assumed that you will have TWO housing payments during the rehabiliation of the new home. This money will be deducted each month during the reahab process) This is optional.
* Closing occurs, and the work begins within 30 days of closing/funding. (This is when your mortgage payments start since this is when you started borrowing the money - however, if you included the 6 mths mtg payments, they will be deducted from escrow starting when your first payment is due)
* Disbursments are made throughout the following 6 months from the escrow account (normally 4 draws with one final inspection, but this can be increased for higher repair amounts) as the work is completed.
Remember you paid the seller for the price of the home, and then you borrowed an additional amount of X which is sitting in an escrow account to pay the contractors (your total loan is the total amount you borrowed)
Once the last disbursement is made and the final inspection showing COMPLETED AS PER THE CONTRACT........you are done! Simple ast 1 2 3 - okay maybe not, but that's why having an experienced lender on your side is crucial!
There are specific properties and repair requirements for this type of loan, so please call me for specific details if this sounds like the right loan for your new home.
Please send me your before and after pics! I would love to see them and maybe even post them for people to see what can be done with this awesome program! Or contact Karin Howe at 630-606-8308 or khowe@westsuburbanbank.com for FHA 203k for more details.
ok details please.........
* Down payment is basesd on the sale price PLUS the final cost of the repairs x 3.5% so for example:
Sale price is 200,000 (DO not calculate 3.5% on this) PLUS 50,000 in repairs/costs (which includes certain costs and reserves the lender will require) 250,000 x 3.5%. Down payment is $8750.00 (closing costs are separate as usual)
* Buyer will hire (lender can recommend) a HUD approved FHA 203k Consultant to go to the property with the buyer to determine the required repairs and wish list repairs.
The fee charged by the consultant can be included in the mortgage. The fee can range anywhere between $ 400 to $1200 depending on the repairs required. Please check with the consultant prior to scheduling your appointment.
*Buyer will obtain estimates from several licensed contractors for the work to be completed depending on how extensive the repairs.
Three estimates are recommended for each contractor but not necessary. The buyer can act as their own general contractor only if experienced and licensed. (FHA says experienced, but most investors require the buyer to be licensed) The contractors must provide documentation to be approved by the lender prior to approval.
The consultant will determine the "required" repairs versus the "wish list repairs". You must start with the required repairs and then move on from there for you wish list. This is an important step for the consultant and appraiser so that you don't over improve the home and exceed the comparable properties in the area.
* Once the consultant completes his report of required and wish list repairs, the lender will forward it to the appraiser for an "After Improved Value". This is where you may run into problems with OVER improving the property based on current values. Between the consultant, appraiser and buyer - the FINAL FINAL report will be tweeked to come up with a final report that the contractors will be hired to do.
* So now the file is submitted to underwriting and approved ( you need to qualify at the full amount you are borrowing of course, which may include your current mortgage payment for the home you will live in during the rehab period) and the normal steps for closing will occur.
(BIG PLUS - you can include 6 months of mortgage payments in the new loan amount since it's assumed that you will have TWO housing payments during the rehabiliation of the new home. This money will be deducted each month during the reahab process) This is optional.
* Closing occurs, and the work begins within 30 days of closing/funding. (This is when your mortgage payments start since this is when you started borrowing the money - however, if you included the 6 mths mtg payments, they will be deducted from escrow starting when your first payment is due)
* Disbursments are made throughout the following 6 months from the escrow account (normally 4 draws with one final inspection, but this can be increased for higher repair amounts) as the work is completed.
Remember you paid the seller for the price of the home, and then you borrowed an additional amount of X which is sitting in an escrow account to pay the contractors (your total loan is the total amount you borrowed)
Once the last disbursement is made and the final inspection showing COMPLETED AS PER THE CONTRACT........you are done! Simple ast 1 2 3 - okay maybe not, but that's why having an experienced lender on your side is crucial!
There are specific properties and repair requirements for this type of loan, so please call me for specific details if this sounds like the right loan for your new home.
Please send me your before and after pics! I would love to see them and maybe even post them for people to see what can be done with this awesome program! Or contact Karin Howe at 630-606-8308 or khowe@westsuburbanbank.com for FHA 203k for more details.
Sunday, July 12, 2009
Smart Homeowners Look to the Future Video
Considerations for long or short term investment and resale should be made when buying a home.
Smart Homeowners Know When to Refinance Video
Refinancing can save tens of thousands of dollars over the life of a home loan.
Smart Homeowners Learn Mortgage Basics Video
Educating yourself on the basics of mortgage finance can save you headaches, time and confusion, not to mention money.
Thursday, July 09, 2009
Secretary Donovan awards over $1 billion in Recovery Act Funds to jump-start affordable housing construction in 26 states
WASHINGTON - U.S. Housing and Urban Development Secretary Shaun Donovan today announced that HUD is approving plans submitted by state housing finance agencies for $1,035,322,485to jump start affordable housing programs in states throughout the countrythat are currently stalled due to the economic recession. Funded through American Recovery and Reinvestment Act of 2009 (Recovery Act), HUD's new Tax Credit Assistance Program (TCAP)will allow 26 state housing finance agencies to resume funding of affordable rental housing projects across the nation while stimulating employment in the hard-hit construction trades.
HUD Secretary announces disaster assistance for Illinois storm victims
WASHINGTON - U.S. Housing and Urban Development Secretary Shaun Donovan today announced HUD will speed federal disaster assistance to six storm-ravaged counties in Illinois and provide support to homeowners and low-income renters forced from their homes following last month's severe storms, flooding, and tornadoes.
Secretary Donovan awards over a billion dollars in Recovery Act Funding to prevent homelessness across the county
WASHINGTON - U.S. Housing and Urban Development Secretary Shaun Donovan today awarded $1.2 billion to over 400 communities across the nation to rapidly re-house families who fall into homelessness, or prevent them from becoming homeless in the first place. The funding is provided through the American Recovery and Reinvestment Act of 2009 to help persons and families facing a sudden financial crisis that could lead to homelessness. To view the list of grantees receiving funding under this round of grants, visit HUD's Recovery Act website.
HUD issues 2008 Annual Homeless Assessment Report to Congress
WASHINGTON - The U.S. Department of Housing and Urban Development today issued its 2008 Annual Homeless Assessment Report to Congress, a national study that explores changes in homelessness nationwide. HUD's assessment concludes that while overall homelessness in America held fairly steady from 2007 to 2008, the number of homeless families, particularly those living in suburban and rural areas, increased.