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Acton Real Estate Newsletter

The US Congress has now passed the compromise “Economic Stimulus Act 2009”, designed to jump start the economy. A number of the initiatives on this bill are designed to help get the housing market moving again. So we thought we would use this newsletter to highlight those initiatives and make you all aware of them.

First of all there is good news for first-time homebuyer. The $7,500 tax credit has been increased to $8,000 and the qualifying period extended from July 1 to December 1 2009. Plus this bill eliminates the requirement to repay the credit as long as the home is kept for at least three years!

Providing help to first-time buyers is a key piece of the housing recovery plan as this promotes new demand that goes all the way up the chain.

For current home owners who are looking to move to a new home there are a number of important changes that will help lower your mortgage costs. The loan limits for Fannie Mae, Freddie Mac and FHA loan guarantee programs, which were bumped back down to $625,500 in high-cost areas on January 1, were restored to the temporary $729,750 approved by Congress a year ago in the Economic Stimulus Act of 2008.

The other major change is in the limits that define a “jumbo mortgage” (and with it higher interest rates). Fannie and Freddie's conforming loan limits, began 2008 at $417,000 and under changes made in the 2008 Stimulus bill, they have been permitted to guarantee loans of up to 115 percent of the median home price in high-cost markets (ours being one!), with a cap of $625,500 (that's 150 percent of the $417,000 conforming loan limit). The 2009 Stimulus bill increases the limit to 125 percent of median home price in high cost markets, up to $729,750, for the remainder of 2009. Allowing you to benefit from the lower interest rates offered on the larger now “conforming” loans.

For those people who qualify for a FHA loan there is also good news. The FHA began 2008 with a $200,160 "floor" loan limit in normal markets and a maximum loan limit of $362,790 in high-cost markets. As part of the Economic Stimulus Act 2009, Congress increased FHA's floor limit to $271,050 in normal markets and the upper limit in high cost areas to $729,750. Bringing significantly more buyers under the FHA loan umbrella.

All these initiatives help provide momentum and incentive to buyers, that will drive new sales in 2009.

Remember we ARE your real estate office. If you are considering selling your home this winter, call to talk to one of our truly independent agents, and get the best possible advice. If you are looking to buy, we love working with buyers as well