No down payment? READ NOW!!

Here is VERY  important info from IHFA for borrowers who would like to take advantage of the federal income tax credit for first-time home buyers. This is GREAT news for buyers who wish to use the money for down payment and/or closing costs!!  Start searching for your dream home now! 

IHFA’s Down Payment Assistance Tax Credit Advance

The American Recovery and Reinvestment Act of 2009 provided a federal income tax credit for first-time home buyers of 10% of the sales price, up to a maximum of $8,000.  This tax credit is available to qualified home buyers who purchase a home by December 1, 2009.  In order to help buyers monetize this tax credit for down payment and closing costs when they purchase a home, Idaho Housing and Finance Association (IHFA), through its IdaMortgage lending program, is offering a special short-term Tax Credit 2^nd Loan to qualified buyers. 

In conjunction with an IdaMortgage loan, a subordinate loan will be offered to qualified first-time home buyers in the amount not to exceed 5% of the sales price or $7,000.  A fee will be charged of $250 with $150 refunded upon repayment of the loan on or before the loan due date.  The loan will accrue interest at 3.0% with a due date of July 1, 2010.  The Tax Credit 2^nd Loan is expected to be paid off from the borrower’s tax refund obtained through the application of the federal tax credit.  The borrower must be a first-time home buyer and qualify for an IdaMortgage loan.  If the home buyer defaults on the loan and cannot repay at that time, IHFA has the option of pursuing foreclosure as described in the deed of trust, or modify the loan to amortize over the remaining term of the first mortgage loan at an interest rate of 3% higher than the first mortgage rate. 

Borrower qualifications are:

1) Must be a first-time home buyer,

2) Must have a FICO score of no less than 640, and a total debt ratio of no more than 45%, (NOT including this second mortgage loan payment).  Some MI’s may require higher credit scores,

3) Home buyer qualifies for an IdaMortgage loan, which includes the monthly second mortgage payment in the debt ratios for this Community second loan just like the Good Credit Rewards second loan,

4) Home buyer Education required. 

 

 

 

Top 10 signs the the real estate market is on the rise

Many people are sitting on the sidelines waiting for the real estate market to hit the bottom before they make a move.

The question is: Have we already reached the bottom?

Last week you may have sensed that the real estate market may be starting to change direction. It is probably not an abrupt 180-degree turn, yet you get a feeling that the real estate ship may be changing direction and here are some of the signs.

Sign No. 1: If you read one of the recent issues of Newsweek, the columnists are hinting of a positive change.

Sign No. 2: On the Fox business channel on Saturday, one of the financial pundits said he was going to go buy two homes for his children so they do not miss this fantastic opportunity.

Sign No. 3: Ben Bernanke, the Federal Reserve chairman, suggested that the recession may be over by the end of the year.

Sign No. 4: President Obama has switched gears and is now proclaiming the “underlying economy is fundamentally sound.”

Sign No. 5: A local financial services company related that the number of stock market buy orders is starting to increase.

Sign No. 6: The number of buyers we are working with is increasing.

Sign No. 7: Metropolitin area business columns are starting to speak cautiously optimistic about the real estate market.

Sign No. 8: The number of national new home starts increased last month.

Sign No. 9: The Federal Reserve did not raise short term interest rates and mortgage rates are still at an all-time low between 5 percent to 5.5 percent.

Sign No. 10: Consumer confidence appears to be on the upswing.

In many situations if you are selling and then buying a home, now is a great time.

Here is one scenario: If you want a larger home and your home’s value was $250,000, today it is probably worth $200,000, a 20 percent decrease in value.

The home you wanted to buy for $500,000 likewise has seen its value reduced by the same 20 percent and today’s price is $400,000.

So when is the better time to sell and buy? In the height of the market, you would have had to come up with $250,000 more than the value of your present home.

In today’s market, you would only have to come up with $200,000 more than the present value of your home.

Combine that with today’s interest rates and ask yourself, is now the time to upgrade?

SWEAT EQUITY ON THE RISE!!

Jim and Kristina have taken advantage of the real estate market.  

At the start of 2009 this couple sold their home in Meridian with the intention of moving to California to be near family.  After months and months of looking at several homes in the Golden State, the couple became discouraged and began to sense that Boise Idaho’s pricing, along with quality of living, was too good to pass up.  With that, Jim, Kristina and I began a search for their new home.

New construction, short sales, bank-owned property and occupied homes alike all had positives and negatives.  When the dust settled, however, the couple found that a well-built bank-owned property within a cozy community fit the bill very nicely.   Although the floors were ratty, the paint distasteful and curb appeal lacking, the home had much potential.  The kitchen was open and bright with plenty of cabinet space, the floor plan flowed with ease and the quality of construction was first rate.  In 2006 this home would have sold for the mid 180’s but by working together, the Beans were able to make the purchase for only  $130,000. 

Jim and Kristina have always been “handy” people.  In fact, while in California the couple spent many weeks helping their son and daughter construct their personal home.  During this time, Jim and Kristina learned trades that included installing tile, hardwood flooring, siding-you name it!!  The knowledge was definitely put to good use. 

The work began.  Kristina began stripping the countertops and laying tile.  Jim started pulling the dirty carpet and ripped vinyl planning to lay a hickory floor.  All the while, doing prep work for the full interior paint job.  After nearly 30 days of sleeping on cots and eating cold dinners, the Beans completed their project and invited me over to see the results of their “sweat equity”. 

I could hardly believe that it was the same home!    The smell of fresh paint and lacquer was prevalent while Kristina excitedly directly me toward the kitchen.  Granite and tile graced the middle island, countertops and backsplashes; the cabinetry was antiqued while the stainless steel appliances topped it off.  “Wow!” I exclaimed.  Next, Jim spoke about the hickory flooring that was laid throughout the first floor.  It was gorgeous and only cost $1,000 for the material!  Jim and Kristina were proud of their work and had every right to be. 

Before leaving, Jim and I discussed the market and what the home might sell for right now.  At least $150,000, I mentioned, if not more.   Jim stated that he and Kristina had put $2,000 (plus or minus) into material and couldn’t be more thrilled that they had realistically made $16,000 for their time.  “In a year or so, Matt, we’ll be doing this again.  And also, my kids down South are itching take advantage of the pricing around here”. 

Jim, Kristina and I

Before Remodel--Kitchen

After Remodel--Kitchen

Before Remodel--Living Room

After Remodel--Living room/mantle