More on Housing and Economic Recovery Act of 2008
August 7th, 2008 - Categories: Real Estate News
By: Charles Woodall
http://www.dothanhomesearch.com
The more I read about this most recent accomplishment of our government, the more convinced I am that it is really nothing more than an election year attention getter. Our government wouldnt do that would they? Pass a piece of legislation that really didnt do a whole lot, except generate some headlines?
Lets take a look at some of the key components. Weve already talked about one that will have a negative effect on the Dothan real estate market. Here are some of the others.
The intent was good, however the results will likely be far from what was intended. This part of the legislation is supposed to help some homeowners to refinance their existing mortgages with a fixed-rate FHA loan. Problem is, the act is completely voluntary, so the bank or mortgage company doesnt have to participate, and the criteria that have to be met to be eligible are fairly tight. Communities hit hard by high foreclosure rates will get some money to buy and fix up foreclosed properties, and money was set aside for counseling for families in pre-foreclosure.
Veterans do recieve some much deserved benefits from this act. The period of time a veteran must be home before foreclosure can begin has been increased to nine months, the VA loan guarantee amount was increased, and benefits were raised for disabled veterans that need to modify some accessibility to their home.
In addition to the aforementioned elimination of down payment assistance programs, there are a couple of other reforms to the FHA program. The FHA loan limit has been increased to 110% of the median home price in an area. For us here in Dothan, that means you can possibly get FHA financing on a home priced up to almost $300,000. Also, the required down payment has increased from 3% to 3.5%.
Another big benefit of this new legislation is the tax credit for first time home buyers. This is basically an interest free loan that will have to be paid back over the course of 15 years. If you sell before then, you pay it back at closing. Since many Americans give Uncle Sam an interest free loan every year just to get some money back at tax time, its only fair that they do the same, right?
These are just some of the points that will effect us here in southeast Alabama the most. There has been a lot of discussion in the blogosphere, and here are some of those links.
The Housing and Economic Recovery Act of 2008: What does it mean for you? from beingfrugal.net
Housing and Economic Recovery Act of 2008 from Maxsell Real Estate.
Lamenting the Housing Stimulus Bill from All Phoenix Real Estate
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