The National Association of Realtors estimates that as many as 180,000
homebuyers have qualified for the tax credit and met the contract
deadline of April 30, 2010, but might not be able to close their
transaction by the June 30, 2010 deadline due to the sheer volume of
loan applications in the pipeline.

If you have any questions about how the federal tax credits and the
extension may benefit your clients, please call me today. I’m available
for consultation with your customers. Please feel free to share this
news, forward this email, or have them call me directly.

/The above content is for informational purposes only and should not be
used as a substitute for consultation with a tax advisor./

Click here to visit my website and apply on line:
http://www.myprospectmortgage.com/ckuck

Cheryl Kuck

Loan Officer
Prospect Mortgage
NMLS# 247809
4275 Executive Square, Suite 700
La Jolla, CA 92037
Office: (858) 550-2523
Cell: (858) 395-3863
Fax: (877) 272-2097
Cheryl.Kuck@prospectmtg.com

Notice from yesterday…. The US Senate voted 98-0 to pass the Homebuyer Tax Credit [within the Unemployment Bill]. It now goes to the House. We expect the House to pass the bill as well and it could go to the President for signature within the week.

Passage of this bill would be wonderful news for the real estate industry in Washington. In essence, the bill extends the $8,000 first-time homebuyer credit through April 30, 2010 and provides a $6,500 credit to new purchasers who have lived in their current residence for five or more years.

According to Senator Patty Murray, “Extending and expanding the successful homebuyer’s tax credit will help families purchase homes and will provide a much needed boost to the local housing market”.

Download Bill Details

Thank you REALTORS for contacting your Senator and urging them to support this bill. Over 25 percent of our members responded to the call to action and helped push this bill through the Senate. Washington REALTORS are preparing a public relations plan to promote the extension if/when the bill becomes law.

This happy?

Yeah, I thought so.

The closer we get to November 30th the more we start wondering about how home buyers will be able to take advantage of the First Time Home Buyer Tax Credit with the clock ticking away…

With there being so much speculation regarding whether the tax credit will be extended or expanded, wouldn’t you like to know if your lender can actually meet the time restraint already looming?

We understand that home buyers are now rushing to buy their first home and we also know that means there will be challenges with closing their purchase in time for them to receive the tax credit.

Let us help.

We are making a pledge to help first time homebuyers take advantage of the current first time home buyer tax credit. We will guarantee* that we will close their loan in 19 days* or less.

How are we going to do this? By having local in-house processing, local in-house underwriting, and by having local in-house funders. Our streamlined processes will ensure that your client receives a fast closing with excellent service.

It is a bold statement and one we are prepared to back up.

Give me a call directly or call any of our loan officers in our Lacey and Puyallup branches. We have 30 loan officers here to help.

19 Days*!

(360) 528-3146

*Guarantee does not apply to USDA loans, HUD owned homes, Short Sale transactions, and Refinances. The following is required: a complete loan package is required at the time of loan submission and supporting documentation must be provided by the borrower prior to loan submission. The 19 day guarantee does not apply in cases where an appraisal review is required, work orders are required or, borrower is unable to provide supporting documentation in a timely manner. PC Home Loans reserves the right to cancel the guarantee at any time before and/or during a transaction.

SHAWN ANDERSON

Senior Loan Officer

PCHomeLoans-Lacey Branch

Main: (360) 528-3140 – Direct: (360) 528-3146

Mobile: (360) 402-0308 – Fax: (360) 292-1195

Website: PCHomeLoans.us

Qualifying first-time homebuyers can claim 10% of the purchase price up to $8,000, or $4,000 for married individuals filing separately. The credit is available for purchases completed on or after January 1, 2009, and before December 1, 2009. The credit is refundable, meaning recipients receive a check for any claim amount beyond what’s owed in taxes.

Eligibility for the first-time homebuyer credit is determined by the date of the completed purchase, not the date of occupancy. One exception is if the home is being constructed, then the date of occupancy is considered the date of purchase. The home must be used as a primary residence (generally defined as where an individual spends more than 50% of their time). To be eligible, the buyer, or either spouse, cannot have owned and used a home as a primary residence within the last three years. A taxpayer who owned a rental property but not a primary residence within the past three years is eligible for the credit.

The credit does not have to be repaid unless the home is sold or ceases to be the primary residence within three years. There are some exceptions: homes sold as part of a divorce settlement, homes destroyed in a natural disaster, homes subject to condemnation, etc.

To be eligible for the credit, the home cannot be inherited, received as a gift, or purchased from a spouse or related person. The credit applies to any type of new or existing dwelling. Even some houseboats and manufactured homes used as primary residences are eligible. The $8,000 tax credit phases out for individuals with modified annual gross income (MAGI) of $75,000 to $95,000 and married couples with MAGI of $150,000 to $170,000.

If any of your clients qualify for the first-time homebuyer tax credit, they can fill out the IRS Form 5405 and claim this amount on line 67 of their 1040 income tax form for 2009. For more information, visit the IRS Newsroom.

The above content is for informational purposes only and should not be used as a substitute for consultation with a tax advisor

Loan Officer
Prospect Mortgage
4275 Executive Square, Suite 700
La Jolla, CA 92037
Office: (858) 550-2523
Cell: (858) 395-3863
Fax: (866) 210-3478
Toll Free: (800) 648-6869
Cheryl.Kuck@prospectmtg.co

Click here to visit my website and apply on line:
http://www.myprospectmortgage.com/ckuck

This was widely welcomed by home buyers, sellers, and realtors alike. But at the same time, it has been a frustration to some home-buyers that they could not use this tax credit as part of their down payment for FHA loans.* The tax credit could not be used for any purposes in obtaining a loan, including a minimum down payment of 3.5% from other sources.

Recent changes have been announced by the Secretary of the Housing and Urban Development (HUD), which are intended to help with this situation. This new FHA rule allows the tax credit to be used as an additional down payment for other closing costs incurred in the process of purchasing a FHA loan. It still does not include the 3.5% down payment, but the contribution towards closing cost could help secure a lower the interest rate.

Furthermore, there are still other issues to be worked out with the scenario of using the tax credit towards any down payment or closing costs. Tax credit would normally be claimed by tax payers “after the fact” of home purchase on their income tax returns. IRS is not intending to pay out any money to anyone ahead of time. It has been proposed that buyers obtain a short term second loan for the amount of the tax credit and pay off this second loan with the income tax refund check. However, IRS is not willing to send the refund check to anyone other than the tax payer. That is a catch 22 situation because buyers could very well spend the refund money going on a vacation and not pay off this loan. There are no lenders at this time willing to fund this second loan without being assured that it will be paid off.

* The FHA is an institution, set up in 1934, which insures the lender’s loans, allowing the buyer to receive lower down payments, lower closing costs, and easier credit qualification. The process of purchasing an FHA insured loan includes rigorous background checks of your income, employment, and credit. Buyers who do not meet the qualifications would have to resort to seller-funded down payment assurance programs, which have been a questionable necessity in the past.

The homebuyer tax credit became law under American Recovery and Reinvestment Act on Feb. 17, 2009.

Main provisions of this bill are:

$8,000 tax credit is available to first-time home buyers for the purchase of a principal residence on or after January 1, 2009 and before December 1, 2009.

• The credit does not require repayment. 
• At this moment, the credit can be claimed on an income tax return to reduce the purchaser’s income tax liability and it cannot be used toward the down payment. (However, there is a potential of an additional law being passed shortly which will allow for a short term loan against this tax credit which can be used for the down payment. More details on this program could be released later this week.)
• If any credit amount remains unused, then the unused amount will be refunded to the buyer in a check.
• Purchaser and his or /her spouse may not have owned a residence during the three years prior to the purchase.
• Principal residence is defined as a single family home, condo, townhome or a coop.
• The credit represents 10% of the purchase price of the home, up to $8,000. As an example, If the purchase price of the home is $75,000, then the credit would only be $7,500.
• Full credit can be received by a single Buyer with income up to $75,000. (Married couples up to $150,000). Partial credit may be received by single Buyers earning between $75,000 and $95,000.($150,000 to $170,000 for couples filing jointly). No credit is available to anyone earning more than these amounts.

Let’s find you a home!