Money Matters
Money Matters
- Federal Housing Administration (FHA) is rolling out new guidelines soon (April) for their loan programs, increasing the up-front Mortgage Insurance Premium (MIP) to 2.25% (currently at 1.75%). For every $10,000 in loan amount, this translates to a cost of $50.00 extra in closing costs. For example, if you were to borrow $200,000 the additional cost would be $1,000.
- FHA is also reducing the amount that a seller can contribute toward closing costs from up to 6% of the purchase price to 3%.
- The first time homebuyer credit is expiring soon as well. April 30th is the deadline for a written contract to be in place; June 30th is the last date for that contract to close.
- Attention existing homeowners; you too may be entitled to a tax credit. There are many out there that are unaware that if you purchase a replacement primary residence (in contract by April 30th, Closed by June 30th) you may qualify for a $6,500 tax credit.
(Certain conditions apply for transactions to be eligible for tax credits—check this web site: http://www.homebuyertaxcredit.com/ and get advice from your professional tax advisor)
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