Weekly Blog Recapby Tim Manni
Let’s review this week’s blog posts with a short excerpt from each (the titles will link to the full post):
Despite the overwhelming support for a second extension of the homebuyer tax credit from the readers of this blog, to this point, lawmakers have expressed little to no indication that there will be another extension.
However, if you or your spouse is overseas on extended duty, you still have another year to take advantage of the Homebuyer Tax Credit.
Confidence is hard to come by these days. Friday’s jobs report certainly didn’t add to anyone’s confidence about a steadily-improving economic picture. Following the release of May’s employment report, stocks fell and hopeful aspirations were eroded. According to latest issue of HSH.com’s Market Trends Newsletter, an improving employment picture isn’t likely to influence higher mortgage rates in the immediate future.
In what is being called “one of the largest settlements in FTC history,” Bank of America (BofA) is being ordered to pay $108 million to the Federal Trade Commission (FTC) because Countrywide overcharged borrowers facing foreclosure and bankruptcy.
Existing and mounting federal deficits have changed the way many lawmakers and economists feel about mortgage interest deductions. The once sacred and holy tax break for homeowners is now at risk of being eliminated, at least for some.
Especially in today’s real estate market where many mortgage lenders are requiring borrowers to put 20% down, saving for an adequate downpayment may be unattainable for many.
On the opposite side of the spectrum, the Federal Housing Administration (FHA) requires borrowers to only put a minimum of 3.5% down. Unable to meet the constraints of 20% down, wave upon wave of new borrowers have opted for FHA loans over mortgages guaranteed by Fannie Mae or Freddie Mac.
Beginning this month, lenders of Fannie Mae-guaranteed loans will likely pull a second credit report near the time of your closing. What does this mean?
Once borrowers fill out a mortgage application, they’re going to be monitored by their lender to see if they apply for new credit or add to their current credit balance. If borrowers do, their mortgage could fall through.
On Wednesday we proposed this question: “Would a new FHA downpayment requirement of 5% really be that big of a deal?” Based on the monetary examples we provided, and given the fact that so many new FHA borrowers would have gone to Fannie and Freddie in the past, the impact of increasing the minimum downpayment requirement wouldn’t have as negative of an impact as the FHA’s commissioner said it would.
-It’s not too late to leave us a comment on any of these stories! We hope to hear from you soon!