CREST Team Blog

No longer is anyone questioning whether or not there is a crisis in the housing industry. Instead, we are being extended a helping hand from the culprits who helped get us all in to this situation. I am not interested in assessing blame for our problems but there certainly were some missteps by the leaders of our financial markets. At any rate, responsible parties are making an effort to correct the situation. We already know that the “Rate Freeze” announced back in early December was a voluntary plan. It certainly didn’t eliminate foreclosures but in some areas it did help slow them down, if only a little.

We now have the Economic Stimulus Package, which is not a magic pill, but is a welcome addition to the recover plan. The plan incorporates the revised limits on Fannie Mae and Freddie Mac loans allowing these two agencies to buy mortgages up to 75 percent more expensive than the current $417,000 limit. Fannie Mae and Freddie Mac would be allowed to purchase loans up to $730,000. However, the limit would differ based on the median home price in a particular metropolitan area. Freddie and Fannie changes will help borrowers with good credit and/or buyers with some down payment money. However, the changes are planned to only be in effect through December.

For the buyers with less attractive credit and little or no money down, Federal Housing Administration limits have also been revised. Changes to FHA limits would be permanent for FHA-backed loans, which had been capped at $367,000.

In an effort to add more spice to the plan we are now hearing of the President’s initiative to give tax rebates. As of this writing the plan is not final but estimates are that rebates could run as high as $800.00 for each taxpayer. Details are expected to be announced during the State of the Union message on January 28^th.

I have heard many times that these changes are “too little and too late”. While that may be true, I welcome any help we can get. The stimulus package coupled with reported declines of home prices over the last year should add some stimulus to our local housing industry and bring some buyers out for the all important spring buying season. It’s still a buyers market, so if you have the need and the resources to buy this is your time to move.

Call the C.R.E.S.T. Team today for help in planning your strategy.