The New Housing Stimulus Package

Even with Presidential veto threats looming, the housing stimulus package has taken another necessary step to being implemented – it has taken on another round of changes, passed the Senate, and is on its merry way to the White House again.

The package is much larger than our aforementioned Foreclosure Prevention Act – it goes by a few different aliases, all hoping to do the same thing – give the US economy the kick in the pants it needs.

Here are the highlights of the new package:

• We all know conventional and FHA loan limits have been raised through 2008. Currently set to expire on New Year’s Eve, the housing stimulus package includes plans to keep them higher than they were in years past – it’s likely to be somewhere around the $700,000 mark. This means lower rates on bigger loans.
• Tax credits for “first-time home buyers” – it’s in quotes for a reason. This group is defined to include actual first-time home buyers and buyers who have not owned a home for at least three years. The tax credit for those buyers can be up to $8,000.
• A property tax reduction for American homeowners—$500 for single filers and $1,000 for joint filers—for the 25+ million homeowners who pay property taxes, but choose not to itemize their deductions.
• What about homeowners already in distress? They’re covered, too – the FHA is working on programs, including FHA Secure, to assist homeowners currently behind on their mortgage and for those who currently owe more than their home is worth. It could help up to 400,000 homeowners potentially facing foreclosure.
• And for the lenders? Better disclosure with regards to the potential changes in mortgage payments during the loan’s lifetime. The information will need to be provided at least seven days before closing.

Those are just the high points of the housing stimulus package. While controversial, Congress has taken ample time to discuss, re-write and re-discuss the bill. It’s coming to the point of fruition – will President Bush sign or not? If he doesn’t, the fact remains that Congress could be so united in the housing stimulus package that they will override him.

What do you think? Will this package pass and get a signature from the President, or will he veto it in this election year? We'd love to hear your opinion. Just click the "comment" link below and tell us what you think. Don't worry, even though you need to insert your email address to post, that email address will not show up here on the site… and no one is going to contact you directly using your email address.. that's our promise! We'd love to hear from you.

How to Screw Up Your Savings

Everyone wants to see their savings grow, but step one is to keep them from actually shrinking.

Many people spend more time planning a vacation than they do in planning their savings. Money Talks editor Stacy Johnson explains:

(Video runs 1:25) 

Any comments? We'd love to hear from you. Just use the "comment" link below to sound off.

Green Homeowner's Insurance?

Fireman’s Fund Insurance Company – the nation’s first provider of green insurance for commercial buildings – will launch green insurance for homeowners starting this summer.

This is the first-ever admitted green insurance available to homeowners in the United States. Setting a new standard, Fireman’s Fund is offering this innovative product to homeowners who currently own green homes or who want to upgrade their residences with green features after a loss using environmental safety and efficiency standards. If a home is completely destroyed, it can be rebuilt to green standards, certified as having Leadership in Environmental and Energy Design status.

Homeowners whose residences are already green will be offered a five percent discount on this coverage, applied to the homeowner premium.

With this new coverage, homeowners will be able to rebuild and replace with green alternatives such as:

• Energy Star®-rated appliances, lighting, electronic equipment and roofing/insulation
• An Energy Star upgrade of heating, ventilation and air-conditioning systems
• Forest Stewardship Council certified wood for millwork, ceilings, siding and framing, including bamboo flooring
• Non-toxic, low odor paints and carpeting
• Water-saving plumbing fixtures
• Elimination of ozone-depleting refrigerants and fire extinguishing agents, replaced with environmentally friendly alternatives
• Debris removed after damage to a home will be recycled and diverted from landfill

The green homeowners insurance is now approved for homeowners in 26 states (Arizona, District of Columbia, Delaware, Georgia, Hawaii, Idaho, Illinois, Kansas, Kentucky, Louisiana, Maine, Michigan, Missouri, Nebraska, New Jersey, Nevada, Ohio, Oregon, Pennsylvania, Rhode Island, Tennessee, Virginia, Washington, Wisconsin and Wyoming), with most other states expected to offer the coverage by year-end. The Coverage will be available in California as part of the Prestige® Home Premier Policy on August 1st.

Houses Trading Like Stocks?

In some parts of the country, the housing market is every bit as risky as the stock market. Seems appropriate then that you can trade houses just like you do stocks. Never heard of the concept? Money Editor Stacy Johnson, explains… (Video runs 1:44)

Any comments about this "House Trading" ?  Tell us what you think by using the comment link below. Your email address will never be published here to protect your identity and security of your email…

Housing Rescue Pace Slows

Hope Now, the mortgage industry alliance of lenders, servicers and housing counselors, reported recently that it helped roughly 170,000 homeowners avoid foreclosure in the month of May. That's down 7% from the 183,000 loan workouts it reported for April.

The group estimates that its members have helped keep 1.7 million homeowners out of foreclosure since July 2007. Repayment plans are considered most effective for borrowers experiencing a temporary financial set back - such as a layoff - in which they fall behind on their mortgage payments.

Housing advocates contend that repayment plans are typically not sufficient to keep today's subprime borrowers in their homes because they don't reduce the borrower's delinquent debt - they simply give borrowers more time to repay their outstanding debt on top of their regular mortgage payments.

While the number of homeowners that Hope Now helped dipped 7% from April to May, the number of homes lost to foreclosure during that same period jumped 35% to 73,000, according to RealtyTrac. Foreclosure filings were up 7% in the same period. That's a trend foreclosure experts expect will continue for the next 18 months.