We received this email today and needed you to know about it right away. Here are a couple of excerpts from the “Fix House First Act”. The rest of the bill is attached to this email. The parts that pertain to you as a current homeowner or as a potential new buyer are below and I will read it to you.
Fix Housing First Act
• Through lower mortgage rates, provides the equivalent of more that $400 per month tax cut for 30 years to more than 40 million credit worthy American Homeowners.
• Provides an additional $15,000 tax credit for the purchase of a new home.
• Includes targeted income and business tax cuts to help create new jobs.
How it works
4.0% to 4.5% Fixed-Rate 30 Year Mortgages
• New and refinanced mortgages would be available for 4.0% to 4.5%-providing a monthly savings of more than $400 for the average homeowner’s mortgage payment.
• Banks would issue these lower fixed-rate mortgages on primary residences-both for new home purchases and for refinanced mortgages for responsible homeowners.
• To encourage banks to issue these mortgaegs, the government will direct Fannie Mae and Freddie Mac to purchase these newly originated loans. Homeowners already holding loans from Fannie and Freddie would also qualify.
• The new, lower rate would be roughly between 4.0% to 4.5% today. The rate would be calculated based upon the historic spread between the 10-year Treasury bill and the 30 year fixed mortgage rate.
• The program would not be for “jumbo” loans.
• These mortgages would be available only until the end of 2010-the time period of a targeted stimulus.
• The cost of the program is capped at $300 billion, though economists believe it would actually be much less.
$15,000 Homebuyer Tax Credit
• The proposal expands the current first-time homebuyer tax credit to make it more attractive and effective.
• Specifically, the size of the tax credit is doubled from $7,500 to $15,000 (or 10% of the purchase price, whichever is less) and the program is expanded to cover all primary residences and all homebuyers, not just first time homebuyers and vacant or foreclosed properties.
• Available for purchases made between January 1 and December 31, 2009
• The cost in lost revenue to the government is about $20 billion.
A real stimulus: More Bank for the Buck
• at a cost to taxpayers of only $300 billion, the 4% mortgage plan could provide up to $6.1 trillion in savings to homeowners over the course of the 30 year loans –up to $150,000 for the average homeowner.
• That’s over $5,000 each year they can spend on other priorities for their families-spending that will spur job creation.
If you want to take action, I’ve found a website that has everything set up to email to the president and our elected officials and you can just enter your zip code to find your officials in your area. www.fixhousingfirst.com. Write to them to get this passed. It is needed sooner than later. It will help so many of you. For now there isn’t any programs or relief for those who need loans above the Fannie and Freddie loan limits which are currently capped at $625,500 for the Los Angeles area, however, this is a start.
2nd, please forward this email to everyone you know who owns a home or wants to own a home. If you would like to know more or have any questions, feel free to contact us at 310-234-3278 or email us at team@westsidehub.com.
This has been Jae Wu on behalf of Sean McMillan and Tony Coldesina at the Westside Hub. Who’s the next person you know who could use our help? Thanks for watching.
