Walker’s Wholesale Houses

In July of 2008, the Housing and Economic Recovery Act established a temporary refundable first-time homebuyer credit equal to 10% of the purchase price of a principal residence, up to $7,500 ($3,750 if married filing separately).

The credit applied to first-time homebuyers who purchased a home on or after April 9, 2008, and before July 1, 2009.

In 2009, legislation passed that extends the credit to qualified first-time home buyers through November 30, 2009.

It also expands the credit from $7,500 to $8,000 for home purchases made after December 31, 2008, and before December 1, 2009.

Generally, a person qualified as a first-time homebuyer if your potential buyer, and their spouses were married and did not own any other principal residence during the 3-year period ending on the date of purchase.

The American Recovery and Reinvestment Act also allows your homebuyers to elect to report a qualifying home purchase made in 2009 as if it occurred on December 31, 2008 (allowing them to claim the credit on 2008 federal income tax return).

What does this mean for your retail buyers? It means that many 1st time buyers that qualify for financing are basically getting paid by the government to buy their new home! That’s why it’s called a stimulus…

What does all this mean to you? Well, with home prices and interest rates at historic lows, this great tax credit program gives potential buyers more incentive than ever to buy their new home by working with you.

Source: https://www.efanniemae.com/sf/guides/ssg/annltrs/pdf/2008/0816.pdf

From the August 2008 requirements from fannie mae.

Bankruptcy

Updating the requirements for bankruptcy actions to apply from the discharge or dismissal date, whichever is applicable, and requiring a longer elapsed time period for Chapter 13 bankruptcies that were dismissed.

For all bankruptcy actions, the elapsed time period to reestablish credit will now be measured from the bankruptcy discharge or dismissal date.

For all bankruptcy cases, other than Chapter 13 cases, the time period to reestablish credit remains at 4 years.

For Chapter 13 cases, a distinction is being made between Chapter 13 bankruptcies that were discharged and those that were dismissed.

The updated policy recognizes the fact that borrowers have reestablished credit through the successful completion of a Chapter 13 plan and subsequent discharge by requiring only a 2-year time period to elapse.

A borrower who was unable to complete the Chapter 13 plan and received a dismissal, however, will be held to a 4-year time period for reestablishing credit.

More than one bankruptcy

Establishing a new policy for borrowers who have more than one bankruptcy filing in the past 7-year time period.

A 5-year elapsed time period is now required to reestablish credit from the most recent discharge or dismissal date for borrowers who have more than one bankruptcy filing in the past 7 years.

The presence of multiple bankruptcies in the borrower’s credit history is evidence of significant derogatory credit and increases the likelihood of future default. The greater the number of such incidences and the more recently they occurred, the higher the credit risk.

Pre foreclosures / short sales

Establishing a new policy for preforeclosure sales.

A preforeclosure sale involves the sale of the property by the borrower to a third party for less than the amount owed to satisfy the delinquent mortgage, as agreed to by the lender, investor, and mortgage insurer.

Due to the increased incidence of preforeclosure sales, Fannie Mae is establishing a 2-year elapsed time period for reestablishing credit following completion of the action.

See the source document: https://www.efanniemae.com/sf/guides/ssg/annltrs/pdf/2008/0816.pdf for full chart.

Date: July 6, 2008

Here is FHA’s Flipping policy

FHA requires that: a) only owners of record may sell properties that will be financed using FHA-insured mortgages; b) any resale of a property may not occur 90 or fewer days from the last sale to be eligible for FHA financing; and c) that for resales that occur between 91 and 180 days where the new sales price exceeds the previous sales price by 100 percent or more, FHA will require additional documentation validating the property’s value. FHA also has flexibility to examine and require additional evidence of appraised value when properties are re-sold within 12 months.

The following sales are exempt from the above mentioned policy

* Sales by HUD of its Real Estate Owned

* Sales by other United States Government agencies of single family properties pursuant to programs operated by these agencies.

* Sales of properties by nonprofits approved to purchase HUD-owned single-family properties at a discount with resale restrictions.

* Sales of properties that are acquired by the sellers by inheritance.

* Sales of properties purchased by employers or relocation agencies in connection with relocations of employees.

* Sales of properties by state and federally charted financial institutions and Government Sponsored Enterprises.

* Sales of properties by local and state government agencies.

* Upon FHA’s announcement of eligibility in a notice (i.e., ML), sales of properties located in areas designated by the President as federal disaster areas, will be exempt from the restrictions of the property-flipping rule. The notice will specify how long the exception will be in effect and the specific disaster area affected.

We hope you find this information helpful!

via Real Estate Blog – FHA title seasoning lifted for bank owned homes as of July!.