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Nearly 50 percent leave Obama mortgage-aid program

Nearly half of the 1.3 million homeowners who enrolled in the Obama administration's flagship mortgage-relief program have fallen out.

The program is intended to help those at risk of foreclosure by lowering their monthly mortgage payments. Friday's report from the Treasury Department suggests the $75 billion government effort is failing to slow the tide of foreclosures in the United States, economists say.

More than 2.3 million homes have fallen into foreclosure since the recession began in December 2007, according to foreclosure listing service RealtyTrac Inc. Economists expect the number of foreclosures to grow well into next year.

"The government program as currently structured is .... to read the full story by MARTIN CRUTSINGER and published in Breitbart.com check here

Homeownership

Canada has neither a Fannie Mae nor a mortgage-interest tax deduction, and yet its homeownership rate is higher than America's.

Feds rethink policies that encourage home ownership

Just how much should Uncle Sam do to help Americans buy their own homes?

For 70 years — and for the last 15 in particular — the answer has been: Whatever it takes.

Now, policymakers are pausing to reconsider. In the next few months, they'll weigh whether there can be too much of a good thing when it comes to helping families finance the American Dream.

The rethink could mean a shake-up for a mortgage market addicted to government subsidies.

Using guarantees and tax breaks, the government pushed homeownership past 69% in 2004. Then it all came crashing down.

Housing prices started crumbling in 2007 . . .

read the full article By Paul Wiseman, USA TODAY

New FHA Underwater Refi Program is Here. -

Watch Video

Related story . . . 'Relatively Few' Loans Will Qualify for FHA Short Refi Program by Jon Prior published in HousingWire.com

Related article . . . New Housing Bailout? Try Old Housing Bailout By: Diana Olick CNBC Real Estate

 

FHA Raise Annual Premiums

The Senate approved its versions of HR 5872 and HR 5981, which would respectively raise the Federal Housing Administration's (FHA) multifamily commitment authority and allow it to hike its annual premiums for its single-family program.

Both bills now travel to the desk of President Barack Obama to be signed into law.

HR 5981, which also passed the House of Representatives last week, would allow the FHA to raise its annual premiums for the single-family program, raising the statutory cap rate to 1.55% from 0.55% — a flexibility that could ultimately reduce the cost of credit insured by the FHA, according to the Mortgage Bankers Association (MBA)

Read the full article by DIANA GOLOBAY published in HousingWire

Bailout Watchdogs Call Mortgage Program a Bust

Government

watchdogs on Wednesday raised a red flag over the Obama administration's program for helping homeowners avoid foreclosure, saying the multibillion-dollar fund is not working and the Treasury Department refuses to fix it. 

Warning that the inefficiencies could hold the economy back, the officials told a Senate panel that changes should be made and that Treasury needs to come clean. One official called the program "one of the greatest failures in transparency and accountability" in the $700 billion bailout. 

A $50 billion fund was carved out of the Wall Street bailout for the mortgage program. The housing market being a root cause of the 2008 economic crisis, the money was pitched as a way to help millions of homeowners avoid foreclosure and get the economy back on track. 

But a fraction of that money, $248 million, has been spent. 

Read the full article by FoxNews.com

The Truth About the 3.8% Tax on All Home Sales

We're being flooded by calls and emails about whether the new Health Care Bill has a federal tax on the proceeds from the sale of your home. The statement goes something like this:

UNDER THE NEW HEALTH CARE BILL - DID YOU KNOW THAT ALL REAL ESTATE TRANSACTIONS ARE SUBJECT TO A 3.8% "SALES TAX"?

YOU CAN THANK NANCY, HARRY & BARACK (AND YOUR LOCAL CONGRESSMAN) FOR THIS ONE. IF YOU SELL YOUR $400,000 HOME, THIS WILL BE A $15,200 TAX.

As with most things found circulating through the "blog-osphere" of our partisan world, this is not entirely true. It is also not entirely false. The new Health Care Bill does include a new 3.8% tax on SOME high income earners ($200,000 single/$250,000 married) after the current capital gains exclusion of $250,000 for singles/$500,000 for married. You can review an accurate portrayl of the new tax at:

http://www.factcheck.org/2010/04/a-38-percent-sales-tax-onyour-home/

Of real interest

is the willingness of government to look at housing benefits for tax revenue. In 2009, the Minnesota House of Representatives passed a bill calling for a significant reduction and redistribution of the Mortgage Interest Deduction and elminition of the property tax deduction in Minnesota. This bill was not accepted by the Senate, but it did pass the MN House of Representatives. President Obama's Budget (not yet passed into law) includes a 5-year reduction in the Mortgage Interest Deduction at the federal level. And, as we noted above, there is an increase in the taxes paid for some homeowners in order to help fund the Health Care Bill.  As demographics change and government looks for items to tax, real estate is no longer viewed as an untouchable cornerstone of the American Dream. Instead, government at the state and federal level are increasingly willing to chip away at real estate tax benefits. This strategy slowly erodes the benefits in a way that many don't realize until it is too late to stop. It reminds me of the story about cooking frogs. Toss a frog in boiling water and it will jump out, place a frog in a kettle of cool water and it will adapt as the temperature rises - even to its inevitable destruction.

Let's not be frogs waiting to see what happens

Senate Passes Homebuyer Tax Credit Extension

Yesterday, the House pushed through a three month closing extension of the homebuyer tax credit.

Tonight, the Senate unanimously approved the bill — leaving the President to ratify the provision by signing it into law, as early as tomorrow morning.

House votes to give homebuyers 3 extra months

Homebuyers would get an extra three months to complete their purchases and qualify for a generous tax credit under a bill overwhelmingly passed by the House on Tuesday. The bill passed 409-5. It now goes to the Senate.

Read the full story by Stephen Ohlemacher, Associated Press and published in StarTribune

 

FHA Fee Increase

Information is circulating on the Internet questioning the rationale of House-passed legislation authorizing FHA to improve its financial stability by increasing the monthly mortgage insurance premium. The premium would increase to .85 percent from .55 percent. FHA is seeking the increase so it can decrease the upfront premium it charges borrowers, which is 2.25 percent of the loan amount.

This increase will rebuild FHA reserves faster than it otherwise could, and lowering the upfront premium will provide homeowners with greater equity. NAR supports the FHA change and estimates that on average it will increase monthly payments by $33. The Senate still must act on the measure. | MORE INFO

Source: National Association of REALTORS®