Market Update

Congress has passed the Housing and Economic Recovery Act of 2008, providing significant opportunities for today's buyers. The legislation includes a large tax credit to help first time buyers take advantage of home ownership. The tax credit -- which is 10 percent of the purchase price, up to $7500 -- is to be paid back within 15 years, essentially making this an interest free loan from the US government. This tax credit provides new buyers with a valuable resources to home ownership!

Fixed Rate mortgages for a 30 year loan remain in the low-to-mid 6 percent range. The National Association of Realtors (NAR) reported an increase in existing home sales during the month of July, up 3.1 percent overall. NAR has revised its current projection of annual existing home sales from 4.86 million units to 5 million units for 2008.

Q: What is a seller-funded down payment assistance program?

A: Seller-funded down payment assistance programs provide seller assistance home buyers who need a little help coming up with their required down payments. The FHA will phase out these programs beginning October 1, 2008. Even so, many other down payment assistance programs exist for helping buyers, including sources from nonprofit community organizations, churches, and family members. Contact your mortgage consultant today for availability information on these important programs.

Many people ask about bi-weekly payment plans designed to reduce the interest paid out over the course of your loan. These programs help the borrower budget an extra payment a year, and over time this can knock years off the repayment schedule. Many people are surprised to learn that they can do this themselves without any special programs, simply by submitting an extra principle payment as they are able. By submitting an extra payment, you get the advantages of an early payout, without the extra contractual obligation. Contact your mortgage professional to determine the strategy that works best for you.