Posted To: MBS Commentary

Last week we'd been discussing the impending drop (November Class A settlement, meaning December coupons become "front month" and/or "on the run" resulting in a sizeable time-value-of-MBS-money-related "drop") in the context of previously significant price levels. We suggested that with enough strength, we could be looking at maintaining a few layers of technical support starting with 100-28+. Not only did we maintain that level, but even manage to stay above 101-00 after the drop. Treasuries, shown above, also had some fun with technical support after dropping past 3.49 on the day. That level, although tested several times, turned out to hold up well with the 10yr improving 5 ticks in price to a yield of 3.480. Meanwhile, the 2yr note was unchanged, thus indicating…(read more)

On Friday, November 6, 2009, President Obama signed the Worker, Homeownership and Business Assistance Act of 2009, commonly known as H.R. 3548,  extending the $8,000 tax credit to first-time homebuyers.  What residents of Rhode Island might not know, is that you do not need to be a first-time homebuyer to get the tax credit.

Under H.R. 3548 bill, first-time home buyers may qualify for up to a maximum of $8,000.  A  “move up” or “repeat buyer” may qualify for up to a maximum of $6,500.

• The law defines “first-time home buyer” as a buyer who has not owned a principal residence during the three-year period prior to the purchase.   
• The law defines a tax credit qualified “move-up home buyer “as a home owner who has owned and resided in a home for at least five consecutive years of the eight years prior to the purchase date. For married taxpayers, the law tests the homeownership history of both the home buyer and his/her spouse.

The tax credit is equal to 10 percent of the home’s purchase price up to the maximum allowable total. Purchases of homes priced below $800,000 are eligible for the tax credit and must be utilized as the borrower’s primary residence.  The home purchase must close on or before June 30, 2009.  You must be in a enforcable binding agreement by April 30, 2009.

• Eligible properties include single-family detached homes, attached homes like townhouses and condominiums, manufactured homes (also known as mobile homes) and houseboats.
• It is important to note that you cannot purchase a home from a family member, a spouse or your spouse’s family.  

Income limits have been increased.  The income limit for single taxpayers is $125,000; the limit is $225,000 for married taxpayers filing a joint return.

Other provisions in the bill include:

• Requiring taxpayers to include documentation to prove that they purchased a home
• Requiring a minimum age of 18 to claim the credit
• Authorizing IRS to look at prior year returns and determine if a taxpayer is eligible for the credit
• Improving tax administration by increasing the number of electronic returns filed by return preparers

There are also other provisions for veterans within the bill:

• Ensures service members will not have to repay the first-time home buyer credit if they are ordered to deploy to a different location and, as a result, forced to sell their home within three years; and
• Extends for one year, to April 31, 2011, the deadline for taking advantage the first-time homebuyer credit for qualifying service members, so that certain service members stationed overseas can take advantage of the credit when they return. 
• Ensures that certain payments under the Defense Housing Assistance Program (HAP) to assist military personnel selling a home that has declined in value are exempt from tax;

If you would like more information about the tax credit or would like to apply for a mortgage, please call or visit my website at http://www.mortgagemasterinc.com/lmckenzie.

 

Lynda Mckenzie

Mortgage Master, Inc.

NMLS# 137627

Direct:  401-524-9796

E-fax:     401-537-9156

E-mail:  lmckenzie@mortgagemasterinc.com

RI Loan Broker 95000655 / RI Lender License 2005 1976LL

 

 

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Yes, it is true.  $1000 down is all you may need to purchase a Falls Ranch home in Yuma, Arizona.

______________________

$1000 Is All You May Need

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With the media telling everyone that local programs do not exist, most buyer do not know that there are state programs that assist with the down payment here in Yuma, Arizona.

When working with the right Realtor and the right Loan Officer you can absolutely still access these programs. 

______________________

The Right TEAM is CRITICAL!

______________________

With the $8000 First Time Home Buyer tax credit being extended, you can now buy a home with as little as $1000 out of pocket and still recieve your tax credit up to $8000 back when you file your taxes.

I look forward to hearing from you about purchasing and financing your home in Yuma, Somerton, San Luis and Flagstaff,  Arizona.

Derek Egeberg, CMPS
The “Approval Coach”
Territorial Mortgage
928-314-1008 ext 13
928-246-0422
www.TheApprovalCoach.com

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Posted To: MBS Commentary

Good Afternoon everyone. Today is Notification Day in the TBA MBS market… At this point, veteran MBS commentary readers are well aware of the events that unfold on "Notification Day". When the process I am about to describe occurs, we usually make a big fuss about it…sometimes we even issue an alert to scare the daylights out of everyone. HAHA sorry but its kinda funny to us! While that humor comes at your expense, it serves a purpose. If written the right way, an MBS ALERT can stick in your memory for months to come. Think back on the chaos that ensued on Black Wednesday. That alert got over 20,000 hits. Remember November 25, 2008? That is the day the Federal Reserve announced the MBS purchase program. The former alert stuck in our memories because rate sheets lost up to 200…(read more)

This question was posted in the Mortgage Question section and I thought I would take the time to answer it.

I have the following question. I divorced 3 years ago and I owned a home with my ex-wife. I moved out into an investment property that I owned. Then I was deployed to Afghanistan and I just came back. I bought a home as a single person in July of this year. Do I qualify for the first time home buyer since the prior property was kept by my ex-wife?. I read somewhere that I could be considered as a first time home buyer
thanks

To answer your question, you need to identify dates and you need to state if you still own either home. If you are no longer an owner on your ex-wife’s home and also sold the investment property OVER three years before buying this new home, you would be eligible for the first time home buyer credit if you fall under the income limits.

We are not tax specialists so you should really consult a tax professional but I am pretty certain there are no exceptions. It cannot be close to three years; must be OVER three years. You cannot have owned any home in the three years prior to buying the new home. Does not matter if it was your primary residence, investment property, condo, etc.

The brand new legislation extends a $6,500 tax benefit to anyone who has owned and lived in one particular home for more than 5 consecutive years during the last 8 years. Cannot be a combined time line from two separate properties and there can be no time line gaps. Must be consecutive but this is new as of this week.

Good question but you really should consult a tax professional also. I hope this information helps get you started and if you have further questions about VA Loans please visit the VA Mortgage Center.com.

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Posted To: Voice of Housing

Wells Fargo last week announced it will let some at-risk borrowers pay interest only on their mortgage loans in order to stay current and remain in their homes. The announcement makes you to stop and think: Wells is gambling on a housing recovery to make up for losses. That sounds very similar to the mid-decade business models of so many lenders who, counting on continuous rises in home values, bet the ranch on interest-only loans. We know how well that went. So Wells’ action has the feeling of a very ironic twist. But the lender’s new strategy does indeed improve credit quality — or at least the appearance of it in the short term — and no doubt will reduce the number of homeowners who might otherwise simply mail in the keys. It’s a very strange world that we’re…(read more)

Posted To: MBS Commentary

The Treasury just auctioned a record $40bn in 3yr notes, $1 billion more than the October issuance. The bid to cover ratio was 3.33 bids for every one bid accepted. The auction saw VERY high demand! The auction stopped out a high yield of 1.404%, 2.8 basis points below the 1pm 1.432% "When Issued" yield . 38.42% of the bids were accepted at the high yield. Here is the intraday 3yr note… Primary Dealers tendered $85.85 billion and were awarded $9.50 billion. 11% of what they bid on and 23.8% of the total auction amount. Much lower than average of previous three auctions. Direct Bidders tendered $9.12 billion and were awarded $2.99 billion, 33% of what they bid on and 7.5% of the total auction amount. More than average of previous three auctions. Indirect bidders tendered $37.98 billion…(read more)

Posted To: Mortgage Rate Watch

Despite benchmark Treasury rates moving higher last week, prices of mortgage-backed securities managed to hold their ground, allowing mortgage rates to maintain status quo in their recent range. To remind readers, as prices of mortgage-backed securities move higher, lenders are able to pass along lower mortgage rates. After the FOMC meeting and the Jobs market report, which indicated the unemployment rate broke the double digit barrier, mortgage rates were marginally improved last week. On Friday, President Obama signed an extension of the $8000 First Time Home Buyer tax credit through April 30th of 2010. The tax credit is also being offered to homeowners who have lived in their current home for at least five years and are seeking to relocate giving them up to a $6500 credit. The income limits…(read more)

Posted To: MBS Commentary

After opening down a few ticks, MBS are up a few ticks as well as the 10yr tsy, however both have come under a small amount of price pressure in the last few moments. This isn't much to write home about as it has only accounted for a 2 drop from 101-14 to 101-12. Meanwhile the 10yr tsy is only 1bp off at 3.48+. Incidentally, this is the same level as the high end of the long term range, but due to INCREDIBLY light volume, you may not want to read too much into that until we get some more confirmation. As to how this AM's price action has affected yields and spreads, the FN 4.0 is +0-03 at 99-24 yielding 4.131% and the FN 4.5 is +0-02 at 101-11 yielding 4.337%. The secondary market current coupon is 4.244%. The Current Coupon is +75/10yr TSY and +60/10yr SWAP. 2s/10s are 2 basis point…(read more)

FHA mortgage rates are lower than conventional mortgage rates right now. It’s an interesting development, especially for homeowners and home buyers with low equity. Unless you’ve got 20 percent into a property, if you’re locking a 30-year fixed rate mortgage, there’s compelling reasons to go FHA.