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HomeReport
Real Estate & Finance News That Affects Your Home June 2008 - Page 2
UPDATE
Economic Stimulus Package Aims To Boost Consumer And Business Spending, Jumpstart HousingBy the time this story appears in print, many Americans will have rebate checks in hand--their piece of the $168 billion economic-stimulus package "pie" that President Bush signed into law in mid-February.
According to the fact sheet published by the White House after the signing of the bill, at least $300 will go to almost everyone who earns a paycheck or gets Social Security or veterans benefits. Tax payers could get up to $600 per individual, $1,200 per couple plus $300 per child.
Additionally, businesses will receive more generous depreciation and expensing rules for their taxes, while the Federal Housing Authority (FHA), and the Fannie Mae and Freddie Mac (GSE) loan limits were increased to $729,750 until December 31, 2008. While that sounds like a generous increase, many lenders are cautioning clients to read the "fine print" of the law, specifically as it applies to:
GSE Loan Limits:
- Loan limits may be as high as $729,750; however, $729,750 will not be the nationwide loan limit. Increases will be available in high-cost areas based on the median area sales prices and will follow the standard HUD mortgage limit calculation process.
- To determine high-cost areas, the calculation factor will increase to 125% of the area median sales price.
- The increase applies to loans originated from July 1, 2007, through Dec. 31, 2008.
FHA Loan Limits:
- Loan limits in high-cost areas may increase to as much as $729,750.
- To determine high-cost areas, the calculation factor will increase to 125% of the area median sales price.
- The increase applies to loans with a credit approval issued prior to Dec. 31, 2008.
In general:
- The higher loan limits will not be immediately available.
- The increases are a temporary solution for some high-cost areas based on Metropolitan Statistical Areas (MSAs).
- Changes related to FHA Modernization were not included in the Economic Stimulus Package.
We will continue to bring you additional details in future newsletters as we learn more about the new law, specifically how it relates to loan limits.
Creative Sellers Don't Wait For Purchase Offer From BuyerSelling in today's buyer's market sometimes takes being inventive. Besides having the right price, the right offer at the right time can help sell your home fast. That's why some home sellers are no longer sitting on their hands. Instead, creative sellers are originating purchase offers to select buyers (also, “reverse offer,” or “seller-initiated offer”) to get the ball rolling.
In this strategy, a seller's offer originates from the seller to the buyer, rather than waiting for a traditional purchase offer to come from the buyer to the seller.
Before you try a reverse offer remember:
- Your listing must be priced right to sell,
- Your home must be in tip-top condition, and
- Your terms for sale cannot be limiting.
Here's how a seller's offer works:
Have your listing broker draw up a purchase offer with the terms you, as seller, will accept for the home sale. The buyer's agent presents the offer to a serious buyer who expressed interest in your home.
Consider making the price and “hot button” terms more attractive than your original listing (such as a price reduction and closing costs) to get the buyer's attention and see if they are serious about purchasing your property. Additionally, be sure to insert all the normal conditions in your offer including an expiration date.
A seller's offer is likely to work best when a buyer has shown true interest in your home with multiple visits. Your home is probably on the “short list” of two or three properties the buyer is considering. Your reverse offer with generous terms may sway the buyer to choose yours over the other properties in the running.
As they say, it never hurts to ask. Together we'll be creative and help you consider a reverse offer to get your home sold quickly.
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