HR 3221 CHANGES IN PROCESS OF BEING DEFINED
FHA LOANS, HOME LOANS, REAL ESTATE LEGISLATION, SHASTA COUNTY, TIPS FOR SELLERS
September 12th, 2008
Our federal legislative bodies write laws and The President signs them into law (sometimes) then others must interpret the meaning of the legislation and codify it into law. This process is underway to implement this sweeping housing bill.
There will be changes to capital gains laws for investors that move into their rental property hoping to convert it to their principal residence to avoid paying capital gains taxes and a recapture of depreciation. The “two out of the last five year” occupancy rule will be modified to a pro rata calculation to be determined.
Rules regarding FHA loans are also being changed. Downpayments are increasing from 3% to 3.5%, the up front mortgage insurance fee will be a flat 1.75 points instead of the sliding scale of 1.25 to 2.5 points based on credit risk and policies for refinancing out of a loan that has a loan balance exceeding the property’s value will be finalized.
These changes should be codified by the end of this month. FHA is suppose to be ready to accept loan applications for the revised loan programs on October 1st. That is also the date any loan using a third party donating a downpayment expires. Loans of this type, such as Nehemiah, must be funded and closed by the end of this month.
Contact me if you have any questions:
530-224-6767 or 530-941-7492
BRAD GARBUTT
REALTOR/BROKER ASSOCIATE
REAL ESTATE PROFESSIONALS GMAC
QUARTER CENTURY LOCAL REAL ESTATE EXPERIENCE
