Everyday there are changes in the real estate world!  I know that I am confused at times and felt that buyers probably are too!!!  I have highlighted some of the changes below which will hopefully assist you with your questions.  If not, contact me and I will get an answer for you.

• As of February 1st, FHA has relaxed their Anti-Flipping rules – under the old rules any property that was purchased within the last 90 days with FHA financing were not eligible for FHA financing.  Whereby under the new rules, a buyer may purchase a property with FHA financing even though the seller had FHA financing and has not held the property for 90 days.  This should help reduce some inventory
• The Home Buyer Tax Credit is restrictive in the way the IRS interprets the credit for married couples.  In the guidelines require that both spouses must have the same exact ownership history in order to claim the credit. The IRS only allows married couples to claim the credit if both spouses qualify for the same type of credit in their own right, even if the couple would get a tax credit if they were unmarried.  Married couples are tested together, and must both be eligible.  Whereas, unmarried couples are tested individually such that if one does not qualify, the other can still get a credit.  There is a movement asking Congress to take immediate action to life these restrictions.  That remains to be seen since the credits expire at the end of April.
• FHA to provide early relief to struggling homeowners – Homeowners with FHA-insured mortgage loans who are experiencing financial hardship are now eligible for loss mitigation assistance BEFORE they fall behind on their mortgage payments.  Previously, these homeowners were not eligible for such assistance until after they had missed payments.  The FHA-HAMP may be used to assist borrowers facing imminent default – defined as an FHA borrower who is current or less than 30 days past due on the mortgage obligation and is experiencing a significant reduction in income or some other hardship that will prevent them from making the next required payment on the mortgage during the month that it is due.
• Can loan modifications cause trouble down the road? – Credit scores can get dinged after a home loan modification, making it more costly or tougher to get a loan or credit card.  How badly your credit is dinged varies significantly depending on your lender, as well as when you received your loan modification, your credit history and how your loan was altered.
• Home buyer tax credit is being delayed –  Since the passing of the stimulus program, more than 1.4 million buyers have taken advantage of the tax credit.  All they had to do was file an amendment to their 2008 tax return (for the ones who filed last spring) and claim the refund of 10% of the purchase  price – up to $8,000.    But all that changed on November 6, 2009 when the rules changes because of an extended and expanded version of the home buyer tax credit went into effect and that put filing for the credit on hold.  This marked the start of a new IRS paperwork wrangle.  Homeowners who closed before November 6th use form 5405 to claim the credit but those closing after that date are in limbo because no form yet exists for them to file.  The IRS had been expected to come out with a revised form by early January but it has yet to release anything.  Because of fraud, you now are now required to submit a signed copy of the settlement state (HUD-1), plus a signed mortgage statement with the new address and a copy of the new homeowner’s driver’s license, bank statement or pay stub showing the new address.  Also, you can not e-file, you must file a paper return.
• Beginning with FHA loans issued on April 5th of this year or later, FHA upfront MIP is going up from 1.75% to 2.25%.  Montly MIP may increase in the near future as well.  Also, seller concessions are dropping from a maximum of 6% down to 3%.
• Fannie Mae announces 3.5% seller assistance on Homepath properties: Borrowers purchasing a Fannie Mae  Home Path property will be given 3.5% of the final sales price to be used towards closing cost assistance or their choice of appliances.  The offer is available to any owner occupant who closes on the purchase of a home listed on HomePath.com before May 1, 2010.  Attracting qualified buyers to the market and reducing the inventory of vacant homes is critical to stabilizing neighborhoods and helping the market recover. Many families are taking advantage of the federal homebuyer tax credit to buy a new home so this is a great time for Fannie Mae to offer some additional help.

Tax Assistance/Breaks

• Free tax preparation begins at locations throughout Indianapolis – This year, the city received a $90,000 boost in funding through a grant provided by the IRS as part of the agency’s Volunteer Income Tax Assistance (VITA) program.  This allowed them to staff 16 sites throughout the Indianapolis area.  The goal is to complete 5,000 tax preparations.  In order to qualify for free tax preparation, an individual must make $20,000 or less each year or $49,000 or less each year with dependents.  For more information on site locations, days and hours op operation, or volunteer opportunities, please call 2-1-1 or visit United Way of Central Indiana.
• New deductions, credits and expanded eligibility rules for 2009 tax return –  Education Credit – More parents and students use a federal education credit to offset part of the cost of college under the new American Opportunity Credit.  The maximum $2,500 credit is available to eligible taxpayers who paid at least $4,000 in qualified college tuition, fees and required course materials, including books, in 2009.  There are income limits, so please consult your tax advisor or read the article above.  Some parents should bypass the new American Opportunity Credit and opt instead for the supercharged Hope Credit.
• Home Energy Credits -If you weatherized your home or bought alternative-energy equipment in 2009, you may qualify for either of two expanded home-energy credits, regardless of your income.  You may claim a credit worth 30% of the cost of eligible home improvements on your principal residence, up to a maximum of $1,500.
• New Vehicle purchases tax credit – If you bought a new car, light truck, motorcycle or motor home on or after February 16, 2009, through the end of the year, you may be able to deduct the state or local sales tax or excise tax you paid on the vehicle on your 2009 tax return.
• Unemployment benefits tax credits – Unemployed workers are allowed to exclude the first $2,400 of unemployment benefits received in 2009.

I know this is a lot to absorb, but well worth the time, it may same you some time or money.

If you are looking to buy or sale, call the realtor that WORKS for you!  I incorporate by market experience and the latest technology to make your home buying/selling experience the best it can be!

Kim Carpenter “Kimsellsindy.com” – Geist/Indianapolis Real Estate Agent
Keller Williams Realty Indy Metro NE
Geist/Indianapolis IN Real Estate Website

sold@kimsellsindy.com
317-509-4000