Positive mortgage news for home buyers
November 17th, 2009
The market has never been better to buy a house and there are several factors contributing to it.
The first is the much publicized Government homebuyer tax credit which has been extended to July 1st, with a house being under contract by April 30th. Recently, Robin Dustow from Wells Fargo Bank (robin.a.dustow@wellsfargo.com), met with us to explain the parameters of this tax credit. It has been enlarged to not only include 1st time home buyers (anyone who has not owned a home for the past 3 years), but also anyone who has lived in their current home for at least the past 5 years. Listed below is the criterion that needs to be met to qualify.
Source: National Association of REALTORS® Government Affairs Division
Congress has extended and expanded the homebuyer tax credit. The modifications in the column labeled “December 1 – April 30, 2010” become effective when President Obama signs the bill. All changes made to the current credit become effective on that date, as well.
The second factor that helps prospective buyers is the loan limits on conforming loans has been extended. The limit is currently $729,750 and was set to expire on Dec 30th. Had it expired, it would have reverted back to $417,000 which means any loan above this amount would be considered a jumbo loan. Jumbo loans are usually harder to obtain and have higher interest rates. The higher loan limits for a conforming loan have been extended until December 31, 2010.
Lastly is the mortgage rate itself, which the government continues to keep artificially low. The chart above shows how historically, when rates have been low, they spike quickly afterwards.
Taking all these factors into consideration, added to house prices being down and still being able to purchase a home with as little as 3.5% down, now is certainly a good time to buy!
Information comes from others and should be verified.
Posted by:
Nadine Gelinas-Coffey
