As part of its plan to stimulate the U.S. housing market and address the economic challenges facing our nation, Congress has passed new legislation that:

* Extends the First-Time Home Buyer Tax Credit of up to $8,000 to first-time home buyers until April 30, 2010.

* Expands the credit to grant up to $6,500 credit to current home owners purchasing a new or existing home between November 7, 2009 and April 30, 2010.

Here is more information about how the Extended Home Buyer Tax Credit can help prospective home buyers become part of the American dream.

Who Qualifies for the Extended Credit?

* First-time home buyers who purchase homes between November 7, 2009 and April 30, 2010.

* Current home owners purchasing a home between November 7, 2009 and April 30, 2010, who have used the home being sold or vacated as a principal residence for five consecutive years within the last eight.

To qualify as a first-time home buyer the purchaser or his/her spouse may not have owned a residence during the three years prior to the purchase.

If you purchased a home between January 1, 2009 and November 6, 2009, please see: 2009 First-Time Home Buyer Tax Credit.

Which Properties Are Eligible?

The Extended Home Buyer Tax Credit may be applied to primary residences, including: single-family homes, condos, townhomes, and co-ops.

How Much Is Available?

The maximum allowable credit for first-time home buyers is $8,000.

The maximum allowable credit for current homeowners is $6,500.

How is a Buyer's Credit Amount Determined?

Each home buyer's tax credit is determined by two additional factors:

1. The price of the home.

2. The buyer's income.

Price

Under the Extended Home Buyer Tax Credit, credit may only be awarded on homes purchased for $800,000 or less.

Buyer Income

Under the Extended Home Buyer Tax Credit, which is effective on November 7, 2009, single buyers with incomes up to $125,000 and married couples with incomes up to $225,000 may receive the maximum tax credit.

These income limits have changed from the 2009 First-Time Home Buyer Tax Credit limits. If you or your client purchased a home between January 1, 2009 and November 6, 2009, please see 2009 First-Time Home Buyer Tax Credit.

If the Buyer's Income Exceeds These Limits, Can He/She Still Get a Credit?

Yes, some buyers may still be eligible for the credit.

The credit decreases for buyers who earn between $125,000 and $145,000 for single buyers and between $225,000 and $245,000 for home buyers filing jointly. The amount of the tax credit decreases as his/her income approaches the maximum limit. Home buyers earning more than the maximum qualifying incomeÑover $145,000 for singles and over $245,000 for couples are not eligible for the credit.\

Can a Buyer Still Qualify If He/She Closes After April 30, 2010?

Under the Extended Home Buyer Tax Credit, as long as a written binding contract to purchase is in effect on April 30, 2010, the purchaser will have until July 1, 2010 to close.

Will the Tax Credit Need to Be Repaid?

No. The buyer does not need to repay the tax credit, if he/she occupies the home for three years or more. However, if the property is sold during this three-year period, the full amount credit will be recouped on the sale.

Higher conforming limits extension Oct 6, 2009

It looks like the higher conforming limits will be extended past the end of year expiry as the bailout continues.

The House passed an extension of the higher loan limits, often called 'conforming' loan limits, as part of its 2010 transportation and housing appropriations bill. The Senate did not, but lobbyists say the higher limits have bipartisan support in the Senate and are expected to be part of the final bill hammered out by the House-Senate conference.

The fall and fall of Santa Clara Co. property taxes July 27, 2009

Last year Santa Clara County reduced the assessed value of 45,000 properties, 90% of which were residential, a sector which declined an average of $78,000 per residence. The condo/townhouse sector (technically known as Common Interest Developments, or CIDs") saw one in five properties now assessed below the purchase price. However the assessment roll total value in 2008 actually grew 7% mainly due to the fact that commercial real estate had not been, as at that time, sufficiently affected by the economic downturn that occured during that year.

This year the reduction in property tax values looks set to be even larger, with values having fallen on one in every five single family homes and one in three CIDs by the end of the second quarter. And now the lagging indicator of commercial real estate is about to reveal the extent of damage done by the downturn to property tax assessments in that sector. It will be a hard pill for the County, and the services it provides, to swallow.

Because commercial lags behind residential, next year could actually be even worse for county assessment totals, despite a recovery in the residential sector.

The result of steeply falling assessed values is "good" when viewed through the lens of a homeowner's property tax payments, but "bad" because it causes government services to be greatly reduced, including parks, libraries, education, and public works.

Homeowners should be aware that market value of a property must drop below the assessed value before they can seek a reduction adjustment, and the time to take note of "comps" (recent sale prices of comparable homes) begins from the valuation ("lien") date, which is January 1. Homeowners have between July 2nd and Sept 15th to formally file an appeal, and can do so by downloading the appeal form from the assessor's web site.

Does Freddie or Fannie own your mortgage? March 10, 2009

In the article below I mentioned that most individual borrowers will likely not know if their mortgages are owned by the Federal Reserve, this lack of knowledge being one of the challenges of the recently announced US government mortgage relief package.

The links below help determine whether a loan is owned by Fannie or Freddie. You need to have the address exactly as it appears on the monthly mortgage statement.

Does Fannie Mae own your mortgage? Find out.

Does Freddie Mac own your mortgage? Find out.

Fed to unveil program to reduce foreclosures, Feb 6, 2009

The Federal Reserve's Chairman Ben Bernanke recently announced the Fed will seek to renegotiate mortgages it owns that might otherwise enter foreclosure. Under the program, the Fed could reduce what a homeowner owes on a mortgage; lower the interest rate; lengthen the term of a loan; or take other steps to prevent a loan from defaulting.

The government program will strive to lower the amount of principal owed by those at risk of foreclosure, especially those with loan balances exceeding 125 percent of the estimated value of their property.

It is unclear how many homeowners could benefit from the program. Further, most individual borrowers will likely not know if their mortgages are owned by the Federal Reserve. If eligible for a loan modification, the homeowner would work with a mortgage servicer and not the Fed directly.

Santa Clara falls 38%, Jan 23, 2009

The median home price in Santa Clara County fell 38 percent in December from a year earlier. Meanwhile bargain hunters scooped up foreclosure properties.

Mortgage rates fall to new low, Jan 2, 2009

The average rate on a 30-year, fixed-rate mortgage dropped to 5.14 percent last week to a new record low, according to Freddie Mac. A year ago, the rate was 6.17 percent for a comparable loan. As a result, mortgage applications last week jumped to the highest level in five years, with more than 80 percent of the applications for refinancings. There also was an 11 percent increase in applications for home purchase loans.