The current tax credit for first time home buyers was set to expire on November 30th, 2009. 
However, the President has signed HR 3548 - a bill that extends that time frame and allows most all purchasers of principal residences to benefit as well.

The Changes:

1. Extend the current first-time homebuyer tax credit of $8,000 through April 30 of 2010. However, if you have a binding contract by that date, you will still qualify if you close within 60 days of deadline.
2. Extend a tax credit of $6,500 to existing homeowners or "move up" buyers in addition to the first-time homebuyers. The home you are leaving must have been used as your principal residence for at least the last 5 years.
3. Increase the income limitations for the maximum benefit to $125,000 for singles and $225,000 for married couples.
4. Purchase limit is $800,000.
5. Military waiver provision cancels recapture provision if the home does not remain your principal residence for at least 36 months.

We are updating our free report "$8000 Tax Credit" and it will be available on our website very soon.  If you have any questions before then, please call us toll free at 1-888-562-6200. 

Author: Doug Walker - VP of Sales, Nashville TN

Two Issues Of Importance

1. The current tax credit for 1st time homebuyers expires on November 30th, 2009.
2. There is currently no incentive for existing or move-up homebuyers to purchase a home with a similar tax credit

The current tax credit for first time home buyers expires on November 30th, 2009. If first time home buyers do not close on a home before December 1, 2009, they will not be eligible for the tax credit. However, a bill has been introduced to extend that time frame and allow all purchasers of principal residences to benefit as well.

Proposed Changes In The Bill:

1. Extend the current first-time homebuyer tax credit of $8,000 through April 30 of 2010. However, if you have a binding contract by that date, you will still qualify if you close within 60 days of deadline.
2. Extend a tax credit of $6,500 to existing homeowners or "move up" buyers in addition to the first-time homebuyers. The home you are leaving must have been used as you principal residence for at least the last 5 years.
3. Increase the income limitations to $125,000 for singles and $225,000 for married couples.
4. Purchase limit is $800,000.
5. Military waiver provision cancels recapture provision if the home does not remain your principal residence for at least 36 months.

Senators worked late into the night on Monday, November 3rd to clear the way for this bill to be signed by the President by voting to end any further debate.

We look for this bill to be signed by the President sometime this week.

Considering purchasing a home?
Check out the great resources on our web site or have a loan specialist contact you and discuss your options. www.churchillmortgage.com

Author: Michael Brown
Phone: 615-370-8634 ext. 137
Email: michael.brown@churchillmortgage.com

In today’s market, there are an increased number of hurdles that must be cleared to obtain a home loan.  Mortgage lenders are saying they must do twice the paperwork in order to close a loan.  As a Loan Officer, I can verify this is true and customers need to be aware.  

Recent changes to the Truth in Lending Act http://edocket.access.gpo.gov/2009/E9-11567.htm  took effect last month, requiring lenders to provide certain disclosures about mortgage fees.   There is no doubt this will help borrowers make more informed loan choices, but I believe this new requirement could create further delays in an already slow lending process.  

What’s the same:

Current regulations require a the Lender to disclose in writing all loan terms within 3 days of taking the initial loan application.

What’s new:

Before a new loan can close, the law requires a seven business day waiting period once the initial disclosures are provided to the customer.   If the interest rate (APR) changes by more than .125% (higher or lower) during the loan process, the Lender must re-disclose and wait another three business days before the loan can close.   This could be costly when considering rate lock expirations.    Delaying a purchase transaction with multiple parties involved adds another layer of stress and frustration to the transaction.  

A Recent Example:

A recent loan closing for one of my customers was delayed when the night prior to closing, it was discovered that we actually disclosed a higher rate at the beginning of the process.   During the process, I was able to take advantage of a lower rate option.   As an advocate for my customers, I had the best intentions in mind but because of this new regulation, the closing was delayed.   Who would ever think that lowering a customer’s rate would cause such drama?  

The closing was put on hold and we had to wait an additional three days before the loan could close.   This caused additional stress for the borrower since he was under a deadline to get the funds from this refinance transaction.   This is the part of the new regulation that makes no sense.

Overall, I agree with these changes.   I firmly believe in protecting the customer and making sure the terms of the loan are crystal clear.   We have put processes in place to prevent these closing delays going forward but Buyers, Sellers, Realtors beware – I believe this is probably the beginning of more changes to come.

Today the Federal Reserve announced it will extend purchase of mortgage backed securities until Mar 2010. However, they will be gradually slowing the pace of those purchases in order to promote a smooth transition in the markets.

Then they reiterated they would keep their options open.

The bond market and mortgage rates initial response was very positive, then went on a roller coaster ride. 

The bond finished up + 9bps Wednesday evening, turning around what was a - 34bps loss just prior to the Fed meeting.  That means interest rates finished up a little better today from their 12:00 levels.
I think this activity of uncertainty will be the norm as we go through the remainder of this year. 

And because we know the Fed's program is an "artificial" rate lowering program and the subsidy is going to taper off and go away, I would put some serious thought into locking in a rate if you have a good benefit.

Author: Brenda Roetger
Phone: 615-370-8888 x.205
Email: Brenda.Roetger@churchillmortgage.com

This time of year, the U.S. experiences all kinds of natural disasters and currently the South is under water. How does this affect your mortgage?  You might be surprised.

• First things first: If your home is flooded, get to a safe place and secure your belongings.

• Next: Find out what options your homeowner's insurance offer.

If you don't have insurance to cover the natural disaster that has damaged or destroyed your home, you may have some options through Federal Aide or Fannie Mae.

Floods, fires and other disasters often require the state to declare an area a 'disaster zone'. This qualifies the state for Federal monies to begin rebuilding the public infrastructure. Sometimes homeowners are given assistance through such a program. Your local government offices will be able to give you more information about these programs.

Fannie Mae, who secures mortgages for lenders, has a disaster relief program in place. They could suspend payments up to 3 months, or reduce payments up to 18 months or create longer pay back plans. All these are on a case by case basis of course.  You can go to www.fanniemae.com for more information.