Thursday, April 23, 2009

Rural Development Increases Income Limits!

New income limits for the USDA Guaranteed Rural Housing Program went into effect on
April 20th. This includes an increase in the income limits nationwide, as well as the implementation of the new “2-Tier” income limit structure, which will simplify program requirements and the qualification process.

Previously, income limits for many counties, including Cumberland & York Counties, depended on the number of persons. There was a different income level for each additional person. The new structure only has two income levels (1-4 persons and 5-8 persons). This increases the maximum income level for most families.

Cumberland & York County:
$73,600 for 1-4 person household
$97,150 for 5-8 person household

Portland Metro:
$83,250 for 1-4 person household
$109,900 for 5-8 person household

This is great news for many buyers!

Here is the link to look up the Rural Development income limits for your area.

Wednesday, April 8, 2009

Tax Credits for Energy Efficiency

President Obama's "Stimulus Bill" (The American Recovery and Reinvestment Act of 2009), which was signed on February 17, 2009, made significant changes to the energy efficiency tax credits. These changes apply to products "placed in service" in 2009.

The highlights are:
  • The tax credits that were previously effective for 2009 have been extended to 2010 as well.
  • The tax credit has been raised from 10% to 30%.
  • The tax credits that were for a specific dollar amount (i.e. $300 for a CAC), have been converted to 30% of the cost.
  • The maximum credit has been raised from $500 to $1,500 total for the two year period (2009-2010). However, some improvements such as geothermal heat pumps, solar water heaters, and solar panels are not subject to the $1,500 maximum.
  • The $200 cap on windows has been removed, but the requirements for windows has been increased significantly. Keep in mind that not all ENERGY STAR qualified windows will qualify.

Click here for more specific information on what is covered by the tax credits.

Friday, April 3, 2009

Are You Ready To Buy?

Determining whether or not you are ready to buy a house can be a daunting task. But, whether you are a renter or you are aiming to upgrade to a larger home, there are signs that will indicate whether you are ready to take the buying plunge.

So are you ready to make the move? You might be if you:

1. Are familiar with the market. If you have been paying attention to how much houses are listed for in the neighborhoods you are interested in and have a realistic idea of how much a house will cost you, you're in good shape. But if you're dreaming about that big corner house with no clue about the asking price, you may want to spend some more time becoming familiar with the market.

2. Have the money for a down payment and closing costs. The down payment is a percentage of the value of the property. Typically, the percentage will be determined by the type of mortgage you select. Down payments usually range from 3 to 20 percent of the property value. You may also be required to have Private Mortgage Insurance (PMI or MI) if your down payment is less than 20 percent. And don’t forget closing costs which include points, taxes, title insurance, financing costs and items that must be prepaid or escrowed and other settlement costs. You can expect to pay between from 2 to 7 percent of the property value. Generally, buyers will receive an estimate of these costs from your lender after you apply for a mortgage.

3. Know how much you can afford. Typically, as a general rule, your monthly mortgage payment should be less than or equal to a percentage of your income, usually about a quarter of your gross monthly income. Also, your income, debt and credit history go into determining how much you can borrow. As a general rule, your debt -credit card bills, car loans, housing expenses, alimony and child support -- should not be more than about 30 to 40 percent of your gross income.

4. Know what additional expenses will come with owning a home. This includes homeowners insurance, utility bills, maintenance costs -- roofing, plumbing, heating and cooling.

5. Have your credit in good shape and make sure your credit report is accurate. Potential lenders will view your credit history. You should get a report from each of the three credit reporting companies (Equifax, Experian, and Trans Union) and be familiar with your scores.

6. You haven't made any recent major purchases, particularly a vehicle. If you do, you may have a harder time getting a loan (or it could potentially lower the amount you'll be approved for).