Just signed and sealed… a $787 Billion Stimulus Plan made up of tax cuts and spending programs aims at reviving the US economy. Although the package was scaled down from nearly $1 Trillion, it still stands as the largest anti-recession effort since World War II.
Home owners and potential homebuyers stand to gain from key provisions in this stimulus plan. Here is what we know as of today...
First-time homebuyers who purchase homes from the start of the year until the end of November 2009 may be eligible for the lower of an $8,000 or 10% of the value of the home tax credit. Remember a tax credit is very different than a tax deduction – a tax credit is equivalent to money in your hand, as opposed to a tax deduction which only reduces your taxable income.
The tax credit starts phasing out for couples with incomes above $150,000 and single filers with incomes above $75,000. Buyers will have to repay the credit if they sell their homes within three years.
Tax Incentives to Spur Energy Savings and Green Jobs — This provision is designed to help promote energy-efficient investments in homes by extending and expanding tax credits through 2010 for purchases such as new furnaces, energy-efficient windows and doors, or insulation.
Landmark Energy Savings — This provision provides $5 Billion for energy efficient improvements for more than one million modest-income homes through weatherization. According to some estimates, this can help modest-income families save an average of $350 a year on heating and air conditioning bills.
More Help for Homeowners in the Future
Another thing to keep an eye on in the coming weeks is President Obama’s plan to help struggling borrowers before they are faced with a default on their mortgage.
According to reports, the Obama administration is discussing plans to help borrowers who are struggling to stay afloat, but who have not yet fallen behind on their payments. At this point, details are scarce; however, reports indicate that President Obama is looking to spend approximately $50 Billion to directly help homeowners before they face foreclosure and financial disaster.
Wednesday, February 18, 2009
Thursday, February 05, 2009
Exciting News
Dear KLM Family:
I'm sorry I've been slow with blogging the last few months. I have been very busy with lots of transactions! Some clients have benefitted from lower monthly payments thanks to a lower 30 year fixed rate mortgage, a few have refinanced into even lower rate 15 year fixed mortgages, and I continue to work with quite a few clients who are going through divorces. And in spite of the slowing real estate market, I have even been financing new home purchases!
Anyway, on to the exciting news.
As you read this blog, I am proud to announce that KLM Mortgage Group has merged with USA Funding Corp! Most of our clients are already familiar with USA Funding as the vast majority of the mortgages KLM has placed over the last few years were funded by USA Funding.
Hopefully you recognize that we have always worked tirelessly to stay ahead of the curve in our ever changing industry. The merger is strategic and vital as it will allow us to continue to provide you with the best possible service, rates, and mortgage products.
I look forward to continueing to be your preferred mortgage professional. Thanks to the long standing relationship between KLM and USA Funding the transition will be seamless for you, our valued clients.
Watch for more exciting updates to be posted!
Peter
414.807.7277
I'm sorry I've been slow with blogging the last few months. I have been very busy with lots of transactions! Some clients have benefitted from lower monthly payments thanks to a lower 30 year fixed rate mortgage, a few have refinanced into even lower rate 15 year fixed mortgages, and I continue to work with quite a few clients who are going through divorces. And in spite of the slowing real estate market, I have even been financing new home purchases!
Anyway, on to the exciting news.
As you read this blog, I am proud to announce that KLM Mortgage Group has merged with USA Funding Corp! Most of our clients are already familiar with USA Funding as the vast majority of the mortgages KLM has placed over the last few years were funded by USA Funding.
Hopefully you recognize that we have always worked tirelessly to stay ahead of the curve in our ever changing industry. The merger is strategic and vital as it will allow us to continue to provide you with the best possible service, rates, and mortgage products.
I look forward to continueing to be your preferred mortgage professional. Thanks to the long standing relationship between KLM and USA Funding the transition will be seamless for you, our valued clients.
Watch for more exciting updates to be posted!
Peter
414.807.7277
Wednesday, February 04, 2009
Inside Story: False Illusions and What You Need to Know
The Fed's been at it again, offering words that sound encouraging at first blush, confirming that their buying program of Mortgage Backed Securities is in full swing and will continue as needed. Of course, the media will pick this up and offer their own interpretation, saying "Good news, the Fed's words on continuing their purchasing program mean that rates will continue to drop lower, and remain low into the summer..." But is this really what that means? Not so.
Here's the truth.
Yes, the Fed has been buying Mortgage Bonds, but if you look at what they are purchasing, they are buying a lot of FNMA 30-yr 5.5% and 5.0% Bonds...which won't have much of an impact on present interest rates. Why? First, see the Fed's purchases for yourself by hitting THIS LINK.
So why is the Fed buying these Bonds? Well if you think about it, it's very smart of the Fed...and maybe even a little sneaky...because 5.5% Bonds actually represent outstanding mortgages with rates of 6 - 6.50%, which are precisely the loans being refinanced at today's great interest rates.
Stay with me here...
With rates at present low levels, many of the mortgages in these FNMA 5.5% pools being bought up by the Fed will be refinanced and paid, thus giving the Fed a quick recoup on some of their investment. And this is likely a big reason why the Fed said they could continue this purchasing program beyond June, if necessary. Bottom line, the Fed buying these higher rate coupons will not necessarily help rates to move lower, as their actions do not impact the loans being originated at today's low rates.
Here's the most important part.
Sometimes I talk to clients who are in a situation where it makes sense to refinance right now, and save $100 per month for example. But when they hear the media throwing around teases of lower rates ahead, they decide to hold off on making the decision to save the $100 per month right now, in the hopes of gaining another $15 per month in additional savings with a lower rate than where we stand presently. Now clearly, rates could turn higher, and this window of opportunity could pass them by entirely.
The clincher is this:
Even if those clients ultimately are correct in timing the market, and eventually grab that lower rate and save another $15 per month - think of what they have lost by waiting. While they delayed, they lost the savings they could have gained by taking action sooner - or in the example used, $100 - for every single month they waited. So even if they got lucky and obtained the rate they were looking for, it could take years to make up what they lost by waiting.
I don't want anyone to miss an opportunity by either waiting, or not understanding what is at stake. Let's talk further on this - call or email me and let's discuss what this might mean for you.
Peter Kazaks
414.807.7277
peter@peterkazaks.com
Here's the truth.
Yes, the Fed has been buying Mortgage Bonds, but if you look at what they are purchasing, they are buying a lot of FNMA 30-yr 5.5% and 5.0% Bonds...which won't have much of an impact on present interest rates. Why? First, see the Fed's purchases for yourself by hitting THIS LINK.
So why is the Fed buying these Bonds? Well if you think about it, it's very smart of the Fed...and maybe even a little sneaky...because 5.5% Bonds actually represent outstanding mortgages with rates of 6 - 6.50%, which are precisely the loans being refinanced at today's great interest rates.
Stay with me here...
With rates at present low levels, many of the mortgages in these FNMA 5.5% pools being bought up by the Fed will be refinanced and paid, thus giving the Fed a quick recoup on some of their investment. And this is likely a big reason why the Fed said they could continue this purchasing program beyond June, if necessary. Bottom line, the Fed buying these higher rate coupons will not necessarily help rates to move lower, as their actions do not impact the loans being originated at today's low rates.
Here's the most important part.
Sometimes I talk to clients who are in a situation where it makes sense to refinance right now, and save $100 per month for example. But when they hear the media throwing around teases of lower rates ahead, they decide to hold off on making the decision to save the $100 per month right now, in the hopes of gaining another $15 per month in additional savings with a lower rate than where we stand presently. Now clearly, rates could turn higher, and this window of opportunity could pass them by entirely.
The clincher is this:
Even if those clients ultimately are correct in timing the market, and eventually grab that lower rate and save another $15 per month - think of what they have lost by waiting. While they delayed, they lost the savings they could have gained by taking action sooner - or in the example used, $100 - for every single month they waited. So even if they got lucky and obtained the rate they were looking for, it could take years to make up what they lost by waiting.
I don't want anyone to miss an opportunity by either waiting, or not understanding what is at stake. Let's talk further on this - call or email me and let's discuss what this might mean for you.
Peter Kazaks
414.807.7277
peter@peterkazaks.com
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