Tap into the Feds!!!

Below is a list as to what potential buyers may tap in too. This federal help will continue to stimulate the housing market. As I have mentioned in previous newsletters, overall in Big Bear, we have been busy with 'smart money" buyers. And they are all looking for a deal! It is importatnt to stay on track and allow us to market your home. I am anticipating a brisk market as we enter into spring and summer. Tradionally, the summer months are busy. As the stock markets continue to faulter, buyers are looking in speciality areas to invest in, hence, Big Bear Lake. Below, please review what buyers could benefit from Federal Government Response Stimulus Bill -- Congress on February 17, 2009 approved a $790 billion economic stimulus bill that includes a modest expansion of a first-time homebuyer tax credit and restores to $729,750 the upper loan limit in high-cost areas for Fannie Mae, Freddie Mac and FHA loan guarantee programs. HOPE NOW Alliance (an alliance of lenders) includes a number of counseling organizations, which consists of all HUD intermediaries that have offices across the United States. The organizations play a key role in the success of HOPE NOW, providing borrower's in-depth debt management, credit counseling and overall foreclosure counseling. The Federal Housing Finance Agency (oversees Fannie Mae and Freddie Mac loans) announced in November 2008 a major program designed to greatly reduce preventable foreclosures with a simplified, streamlined loan modification program to get struggling homeowners into mortgages that they can afford. The program requires the cooperation of homeowners, banks, mortgage services, investors, Fannie Mae and Freddie Mac. The federal Mortgage Forgiveness Debt Relief Act of 2007 exempts from federal income tax any debt forgiven for a loan secured by a qualified principal residence. A tax break applies to debt discharged from 2007 to 2012 on a qualified principal residence (debt incurred to acquire, construct, or substantially improve a principal residence up to $2 million). The "BK Cram-down" is also pending. If passed, the legislation would authorize a bankruptcy court to modify the mortgage loan on a primary residence as is already allowed for other types of debts. The borrower would have to contact the mortgage lender 10 days before filing for bankruptcy to give the two sides time to work out a modification. If the lender does not make an offer, a judgment could then adjust the loan balance to fair market value, cut the interest rate and extend the loan as part of a court ordered Chapter 13 five-year payment plan. California Response California has an exemption similar to the federal law. The state exemption applies to debts discharged in 2007 and 2008, and the maximum qualifying debt is only $800,000, not $2 million, and the maximum tax exclusion is $250,000 for couples filing jointly and $125,000 for individuals. Page 2 of 2 March 1, 2009 MORTGAGE INDUSTRY RESPONSE Many lenders have loan modification information available on their websites. Each specific lender should be contacted directly for its specific loan modification program requirements. Bank of America announced in October 2008 that as part of settlement of an $8.4 billion class action, it will modify 400,000 loans it acquired from Countrywide Financial Corp. Indy Mac Federal Bank (which was taken over by the Federal Deposit Insurance Corporation [FDIC] in July 2008) announced in August 2008 a systematic streamlined loan modification program implemented by the FDIC. There were 5,300 completed loan modifications by November 2008. JP Morgan Chase & Co. announced in October 2008 that it would modify loans for 400,000 Washington Mutual borrowers. Citigroup announced in November 2008 that it would make $20 billion modifications to 500,000 at-risk homeowners. The number of actual successful modifications is rather low, and there are statistics that show many of the modified loans are back in default in less than a year.

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