SW Florida Real Estate - Housing and Economic Recovery Act of 2008

There are several components to the new law that was recently passed.




One of the components will help make homeownership more affordable by creating a refundable TAX CREDIT for first time homebuyers, it works like an interest free loan up to $7,500 and is filed on your tax returns.

~ a First Time Homebuyer is defined as someone who has not owed a PRIMARY residence in the last 3 years~

(click on the links below for more information)



TAX CREDIT AT A GLANCE


http://www.federalhousingtaxcredit.com/glance.php




F.A.Q.


http://www.federalhousingtaxcredit.com/faq.php#3

Another component is the FHA HOUSING STABLIZATION AND HOMEOWNERSHIP RETENSION ACT

Starting October 1, 2008 and ending on September 30, 2011 the Federal Housing Administration (FHA) will be offering goverment insured mortgages thru FHA approved lenders for borrowers in danger of losing their homes.

The existing lender must agree to voluntarily reduce the mortgage for an at-risk homeowner to at 85% of the property's current value and the new loan with the new lender would be for 90% of the current value. The 5% difference helps pay for the program and the mortgage insurance premium.

http://www.nbnnews.com/NBN/issues/2008-07-26/Politics+%26+Government/2.html

The homeowner has the following criteria to meet to be eligble for the program:

• property must be owner occupied - NO investors, speculators, or second homes will be considered



• monthly mortgage payment must be greater than 31% of the borrowers total monthly income as of march 1,2008



• borrower must certify that they did not obtain the loan with fraudulent information and have not intentionally defualted on an existing mortgage



• borrower cannon have been convicted of fraud

The homeowner has to apply for and qualify for the new loan and their current lender has to agree to the reduction in the balance owed and all new loans must be a 30 year fixed rate loan.

This program is voluntary for lenders, investors, loan servicers and borrowers, but if all parties agree the homeowner should be able to get some much needed relief and be able to stay in their home.

For more information on either of these components just email me or give me a call at

franziskasmith@gmail.com or 239-940-2995

Franziska Smith

Broker

Bonita Estero Realty Corp divisions: Lee Collier Real Estate - Coastal Elite Properties

www.LeeCollierRealEstate.com