Homebuyers credit

[preddy08]

FYI, Krandall and anyone eles lookin at homes for the first time.


In short, they may bump the $7,500 to $15,000 and you wont have to pay it back. Also intrest rates could go as low as 3%. Government will make up the difference.

Stright CNNMoney....
"NEW YORK (CNNMoney.com) -- As Senate Democrats angle for enough votes to pass an $885 billion economic recovery package, the Obama administration has laid out what it does - and doesn't - want in the final package.

"[President Obama] is insistent that the bill not include any earmarks or special projects. While many such projects may be worthy, this emergency legislation is not the proper vehicle for those aspirations," White House Budget Director Peter Orszag wrote in a letter Tuesday to leaders on Capitol Hill.

The letter went to Senate Majority Leader Harry Reid, D-Nev., Senate Minority Leader Mitch McConnell, R-Ky., and other key senators.

Republicans and some Democrats are pushing to strip the stimulus bill of measures they consider wasteful or ineffective. Sens. Ben Nelson, D-Neb., and Susan Collins, R-Maine, are working on an amendment that would slash what they call wasteful spending from the bill.

Republicans also have been pushing for stronger housing provisions. Orszag, however, urged the Senate to hold off on adding big provisions addressing the housing crisis until they see the administration's foreclosure prevention plan.

"Any major new housing provisions should be considered only after the release of the administration's comprehensive proposal," Orszag wrote.

Republicans want to introduce a provision that would encourage lenders to temporarily offer 30-year fixed rate mortgages with interest rates between 4% and 4.5%. The loans would only be available to credit-worthy homebuyers of primary residences and homeowners seeking to refinance. The Republicans said they would cap the program at $300 billion. But some say the plan could cost much more than that.

Obama and Treasury Secretary Tim Geithner are expected to announce their plan to prevent foreclosures in the "coming days," Orszag said. Democrats in the House and Senate, meanwhile, are trying to get a stimulus bill passed and sent to the White House before Presidents' Day on Feb. 16.

Orszag's letter also noted, however, that the administration supports the housing provisions currently in the stimulus bill being debated.

The biggest is an expansion of a homebuyer credit. The bill would remove the requirement that a temporary $7,500 first-time homebuyer credit be paid back over time. Republicans have called for an increase in that credit to $15,000 and, along with some key Democrats, are pushing for an expansion in eligibility so that it would apply to all homebuyers of primary residences. Such amendments are expected to garner a lot of support.

Still calling for longer term provisions
Orszag reiterated that Obama wants to see a recovery package that addresses not only near-term need but long-term economic growth.

"As we address the pressing demands of lifting the economy out of a recession, we also must look to the future and begin the process of reinvesting in priorities like clean energy, education, health care and infrastructure so that the United States can enhance its long-term growth," Orszag wrote.

Critics of the stimulus package, however, contend that much of the money in the legislation would in effect boost government spending in the long run and put considerable pressure on already record federal deficits.

"In this package, there are many new popular spending programs labeled temporary," Senate Finance Committee Ranking Member Charles Grassley, r-Iowa, said during floor debate on Tuesday. "I will challenge anyone on the other side to tell me these programs will be turned off once enacted."

Critics argue that worthy longer-term measures should be put through the normal legislative process and be subject to so-called pay-go rules, which require lawmakers to pay for the cost of a measure by either raising taxes or lowering spending elsewhere.

In his letter, Orszag said the administration wants lawmakers to minimize the long-term cost of all provisions as much as possible. "Furthermore, the president is committeed to paying for any extenion of the temporary tax cuts included in the recovery plan that he would like to make permanent."

How he plans to do that will be detailed when he submits his fiscal year 2010 budget request later this month"

[Krandall]

Man.. I hope this goes through fast!

[preddy08]

Man.. I hope this goes through fast!

Right now you can get the 7500 but you have to pay it back through your tax return. 500 a year till its all paid off. No intrest.

Although you cant beat 15,000 for free!

[Flynbyu]

There was a similar program like this through Lend a Hand. It was a $15,000 grant for home buyers, but it had income requirements to qualify. Now it's a $7500 tax credit. The current plan was to possibly bump it to a $15,000 tax credit to spur home purchases.

I hope it passes too. If that's the case, I may look to build my new casa.

~Brian

[Krandall]

Man.. I hope this goes through fast!

Right now you can get the 7500 but you have to pay it back through your tax return. 500 a year till its all paid off. No intrest.

Although you cant beat 15,000 for free!

Yup, I saw that. Pretty cool, but I'd rather not have extra stuff comin out of my taxes. Just seems to be to much to keep track of.

[preddy08]

There was a similar program like this through Lend a Hand. It was a $15,000 grant for home buyers, but it had income requirements to qualify. Now it's a $7500 tax credit. The current plan was to possibly bump it to a $15,000 tax credit to spur home purchases.

I hope it passes too. If that's the case, I may look to build my new casa.

~Brian

What is this Lend a Hand you speek of?

[Flynbyu]

There was a similar program like this through Lend a Hand. It was a $15,000 grant for home buyers, but it had income requirements to qualify. Now it's a $7500 tax credit. The current plan was to possibly bump it to a $15,000 tax credit to spur home purchases.

I hope it passes too. If that's the case, I may look to build my new casa.

~Brian

What is this Lend a Hand you speek of?

Sorry, it was Helping Hand. It was a grant under the G.A.P. (Grant America Program).

The fledgling and often overlooked non-profit housing grant industry has boosted its visibility with the new Homeownership Alliance of Nonprofit Downpayment Providers, or HAND.

The new association will help the industry become more proficient at giving away the hundreds of thousands of grants each year ranging from $6,000 to $15,000 per home buyer.

For qualified and approved buyers, typically low- to moderate-income home buyers who are often first-timers who can't otherwise afford a home, the gifts unlock the door to the American Dream.

Approximately 2 to 5 percent of the cost of a home, the grants are enough to cover closing costs and or some or all of the down payment -- two of the primary barriers to home ownership.

"I've been talking to professors of urban affairs and almost no one has heard of this industry. It's a five-year old industry and there are about 22 agencies. We are doing it with private capital. It is a gift to a buyer. The buyer doesn't repay the money. That's the main appeal," said Jon Cottin, the new association's executive director.

HAND members target creditworthy consumers who may already spend as much as half their income on rental housing, but because of those prohibitively high living expenses can't gather the cash for the upfront costs associated with buying a home.

Targeted home buyers also typically qualify for Federal Housing Administration (FHA) loans, which max out at $300,700. Do the math. That means the grants can be as much as $15,000.

A Federal Reserve Bank of Minneapolis study says grants bridge the gap to home ownership and can be a better deal for first-time home buyers than lower mortgage rates. The study says mortgage rates would have to fall two full percentage points just to nudge up the rate of home ownership.

"It's (HAND operations) opening housing up to a new pool of buyers," said Cottin.

Most of the grants come from sellers who donate, as a grant, a percentage of the proceeds from the sale of their home, says Cottin. The young grant industry generates 120,000 transactions a year, Cottin says.

Upcoming federal efforts pale by comparison.

"The (Bush) administration and Congress are heading toward an appropriation of $200 million..you'd get about 45,000 transactions over five years and the federal grants are coming out of taxpayers pockets. For the most part, our donations are made by the sellers," Cottin said.

In addition to gifts, many industry players also offer home and mortgage counseling, mortgage payment protection insurance and other services that help novice home buyers get and keep a roof over their heads.

The new agency will also establish self-regulating standards to ensure that the industry works toward reducing mortgage defaults and foreclosures. Another industry goal is to foster the creation of innovative affordable housing products.

The digital paint is still wet on HAND's Web site, scheduled to open later this year, but consumers who need a hand with buying a home can contact HAND's founding members directly to determine if they qualify for a grant.

Link: http://www.downpaymentalliance.org/realindex.html

If you make over X amount, you don't qualify.

The Grant America Program defines a low to moderate-income homebuyer as anyone
that qualifies for an FHA loan under HUD guidelines.  For non-FHA loan programs, the
low to moderate-income definition is met by qualifying for a loan program that accepts grant /
gift funds for use towards a down payment. 


~Brian