Good News from Congress!

There have been two significant programs in place this
year that have contributed to any housing recovery that
we have been experiencing.

Both had deadlines that threatened to turn their coaches
into pumpkins, unless Congress pushed through legislation
that would allow them to continue.

First, the first-time home buyer tax credit of $8000 was
scheduled to expire as of November 30, 2009. There was
a lot of concern that with the length of time that it was
taking for short sales and foreclosures to work their
way through the system, that a lot of needy buyers would
miss out.

But, the Senate has approved an extension of the tax
credit until April, 2010. It appears that there are no
changes to the requirements to receive the credit, and it
has not yet been signed into law by the President. It
would be highly unlikely that it would not move forward.

Second, over the last couple of yeras we have enjoyed
a lending category commonly known as high-balance
conforming loans. Conforming loans have a maximum of
$417,000. The high-balance conforming loans that are set
by county.

In San Diego County, the high-balance conforming loan
amount on a single-family home is $697,500.

The enabling legislation called for an expiration to this
program as of December 31, 2009.

But, the President signed an extension for the availability
of these higher loan limits that will continue through
December 31, 2010.

This is incredibly helpful in the San Diego market because
it allows properties in the $550,000 to $900,000 range to
obtain more affordable financing that can be purchased by
Freddie Mac and Fannie Mae.

If we had to rely on the traditional market (loans above
$417,000 before the high-balance category was created),
availability of loan products would be impaired and the
interest rates and fees would be higher.


What the government is helping us with on one hand is
being micro-managed and over-regulated on the other.

Soon, I will try to summarize just how we are going to
try to navigate through the HVCC, MDIA, HPM Section 35,
HMDA, Red Flag, RESPA, and the SAFE Act which will
be in effect in 2010.

It is going to create a more complicated process and
create timing considerations that will most likely
lengthen the time it takes to close an escrow.

But, that is for another day!