Buyers Are Also Receiving Government Assistance
May 26, 2009
There is a lot of media spin about the loan modification programs designed to assist underwater homeowners. There are fewer media reports about what the government is doing to assist buyers.
First and probably foremost, the government and the Federal Reserve have managed money in such a way that interest rates have remained at all time lows. As of this past weekend, borrowers could obtain a 30 year fixed rate conforming loan (up to $417,000) for an interest rate of 4.875% with a 1% origination point. These loans generally do require the borrower to have a 20% down payment. However, if you are a borrower with less than the 20% needed, you can finance with an FHA loan at a %% interest rate for 30 years with the same 1% origination fee.
I read in Sunday's San Bernardino Sun newspaper that the California Housing Finance Agency has reinstated the California Homebuyer's Downpayment Assistance Program for first time homebuyers. CHDAP offers a loan of 3% of the home's purchase price toward the down payment and closing costs. Payments on this loan are deferred for the life of the first mortgage. To qualify, the buyer must be a first-time homebuyer and must live in the property as the buyer's principal residence. For more detailed information, you can go to http://www.calhfa.ca.gov/
On going stimulus for buyers is the federal government's $8,000 tax credit for first time homebuyers. to find more information on this assistance, go to http://www.irs.gov/ It is paid when you file your 2009 tax returns as a credit to the amount of taxes that you owe. If the $8000 is greater than the amount you owe, my understanding is that you will receive a refund check.
With prices declining to 2002 levels and more favorable interest rates, this is an opportunity for anyone who truly wishes to become a homeowner.
There is a lot of media spin about the loan modification programs designed to assist underwater homeowners. There are fewer media reports about what the government is doing to assist buyers.
First and probably foremost, the government and the Federal Reserve have managed money in such a way that interest rates have remained at all time lows. As of this past weekend, borrowers could obtain a 30 year fixed rate conforming loan (up to $417,000) for an interest rate of 4.875% with a 1% origination point. These loans generally do require the borrower to have a 20% down payment. However, if you are a borrower with less than the 20% needed, you can finance with an FHA loan at a %% interest rate for 30 years with the same 1% origination fee.
I read in Sunday's San Bernardino Sun newspaper that the California Housing Finance Agency has reinstated the California Homebuyer's Downpayment Assistance Program for first time homebuyers. CHDAP offers a loan of 3% of the home's purchase price toward the down payment and closing costs. Payments on this loan are deferred for the life of the first mortgage. To qualify, the buyer must be a first-time homebuyer and must live in the property as the buyer's principal residence. For more detailed information, you can go to http://www.calhfa.ca.gov/
On going stimulus for buyers is the federal government's $8,000 tax credit for first time homebuyers. to find more information on this assistance, go to http://www.irs.gov/ It is paid when you file your 2009 tax returns as a credit to the amount of taxes that you owe. If the $8000 is greater than the amount you owe, my understanding is that you will receive a refund check.
With prices declining to 2002 levels and more favorable interest rates, this is an opportunity for anyone who truly wishes to become a homeowner.
posted by shirley harry at 7:53 AM
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