Epain Homes

RWF Mortgage loan officer Ken Dickerson sent a brief blurb regarding the state of the $8000 tax credit extension. Email Ken at Kenneth.B.Dickerson@rwfmortgage.com

Vote on Extending Homebuyer Tax Credit Delayed Over TARP Issue
Bloomberg, By Brian Faler and Ryan J. Donmoyer

October 30, 2009

The U.S. Senate won’t vote until next week at the earliest on proposals to extend both an $8,000 tax credit for first-time homebuyers and unemployment benefits for the nation’s jobless.
Senate action was delayed by a Republican demand that a vote be allowed on an amendment to end the Treasury Department’s Troubled Asset Relief Program at the end of this year.

Senate Majority Leader Harry Reid, a Nevada Democrat, balked yesterday at the demand by Senate Minority Leader Mitch McConnell, a Kentucky Republican. Reid also took procedural steps to end debate and schedule Senate action on extending the homebuyer tax credit and the unemployment benefits.

Lawmakers announced plans earlier this week to attach the tax-credit proposal to a pending bill on the unemployment benefits. The $8,000 tax credit, enacted earlier this year as part of the $787 billion economic stimulus package, is set to expire at the end of November.

The lawmakers want to extend it until April 30. Their proposal would also expand it to allow higher-income Americans and some who already own homes to qualify for the break.

Homebuyers who have lived in their prior residences for at least five years may receive a $6,500 credit under the plan, said Senate Finance Committee Chairman Max Baucus. Also, couples earning as much as $225,000 and individuals as much as $125,000 would qualify for the extended break, Baucus said. That’s up from a $75,000 limit for individuals and $150,000 for couples.

The lowest closing price was about $625,000 for a three bedroom, one and one-half bath (ouch) renovated four square on a 25×120 lot. The highest price closing was… well, if you have to ask you can’t afford it, if you know what I mean.

Since the process of obtaining an appraisal for a residential real estate transaction has changed earlier this year – it has caused some aggravation and unnecessary grief to home owners, Realtors, and some loan officers. Since the Home Valuation Code of Conduct (HVCC) now has a track record, the market is beginning to question the new policy’s effectiveness.

Because of these questions that are being asked by homeowners, Realtors, and bankers – Congressional members are beginning to discuss options and if the new Home Valuation Code of Conduct (HVCC) is set up correctly. The attached link raised the questions from Congressional legislators – is the cost of obtaining an appraisal today higher and are today’s appraisals less accurate under the new HVCC policies?

The current policy of the HVCC states no person tied to the real estate transaction can order or speak to (influence) the appraiser within residential real estate transactions. Therefore – the Loan Officer, Loan Processor, Loan Underwriter, etc… can not select the appraiser, speak to the appraiser regarding values or comparable properties, nor challenge directly the appraiser on the value or any errors on the report. Instead all concerns and/or errors must go through an appraisal management company – which initially accepts the order for the appraisal, selects the appraiser, and accepts the appraisal report from the appraiser.

If the initial report turned in is inaccurate, presents a low value, or has any errors – the Loan Officer and parties involved with the transaction must go through the management company to contest the appraisal report for changes. This process has been viewed to cause the appraisal reports to come back inaccurate and at a higher cost. The HVCC also prohibits the use of one appraisal report to be used by multiple lenders – which in the end may still be a good thing.

In my opinion – it’s perfectly fine to have this system of checks and balances in place. But it should not cause more appraisal inaccuracies nor drive up the cost of appraisals for the consumers and lenders involved.

More importantly, impediments in the appraisal process can hurt area small business if they can’t refinance, sell or acquire real estate. Not to mention, it hurts business in general for all parties involved if appraisals impede transactions.

Attached is a great article and how some Congressional legislation may come into affect to change this recent adjustment to the residential lending industry. Which will have an affect on today’s Small Business community as well.

From CNBC Could HVCC Be History??

For more questions on appraisals and lending please contact Brian Cumpton of RWF Mortgage. Just click the link.

Jillian and I spend a lot of time with the family in Lincoln Square. Tonight was one of those special warm fall evenings with our kids and neighbor friends.

My wife and I almost made the mistake of passing on our current duplex condo because it did not have exterior storage on site. We loved everything else, but with kids on the way we were sure a storage room would be necessary.

Instead, we came to our senses- bought the place- and rented a 10×10 storage unit two blocks away for seasonal items, tools, kids clothes and toys etc… We also routinely purge any “stuff” collected. If we really can’t part with it but we don’t need it this minute (or week), it goes to storage.

Not too long ago, we made the mistake of sacrificing location to get a condo with “everything” on our needs list. We learned from our mistake that your condo need not solve all your issues. You can outsource things like storage and parking. You can get rid of stuff. But you can’t outsource your location… which is the ultimate want and need in city living.