Homeowners
Homeowners are big winners in the 2010 Economic Stimulus Plan receiving a large portion of the plan’s budget. This is because the real estate market is still trying to recuperate from the devastating hit it took last year and these financial measures are hoped to help speed along the recovery. There are first time homebuyer tax credits, current home owner tax credits and even financial aid for homeowners at risk of losing their home to foreclosure.
Stimulus For New Home Buyers
If you are feeling the economic pinch, don’t sit back quietly as If you are ready to own your first home, you may qualify for the new home buyer's tax credit. This is an extension of the 2009 new home buyer’s credit, but has increased incentive. This year new home buyers will receive $8,000; or $2,000 quarterly that never has to be paid back. A first time home buyer is defined as someone who has not purchased a house within the last three years. This stimulus aid makes it easier for people to buy their first or new home much sooner than they would on their own.
If you are having trouble getting that first mortgage, consider loaning agencies that specialize in mortgages for people with poor credit, sometimes referred to as bad credit loans.
Stimulus for Existing Home Owners
There is a separate stimulus package for existing home owners looking for a new home. These individuals could qualify for a $6,500 credit if they have lived in their existing residence for at least 5 years and make no more than $125,000 individually or $250,000 as a couple. This salary allowance is up $50,000 from last year’s policies and as such many more Americans are able to take advantage of this stimulus. If you are thinking about making a switch and moving to another area now is the time while interest rates are low and you can lock in at a 3-5% rate of interest! You can even find this rates right online!
Stimulus for Homes at Risk of Foreclosure
If you are a homeowner who just can`t afford your mortgage payments anymore, don`t just sit there and do nothing while your payments become delinquent and you lose your home to foreclosure. There is stimulus aid available to you.
Refinancing your mortgage is just one of these options. Under the stimulus plan you are guaranteed to get a significantly lower interest rate which also means more affordable mortgage payments. On average, 38% of a family's income goes towards paying their house payment. This is way above the recommended 30% of your salary. By refinancing your home to have a much lower interest rate your payments will drop to about 31% of your salary. This means a family with a household income of $50,000 that typically pays $19,000 per year toward their mortgage will now pay $15,500 towards the mortgage, translating into $3,500 in savings. This money can then be used to pay of other bills or to create an emergency savings fund.
You may also want to consider a home equity loan or a line of credit that generally have a lower interest rate than personal loans and credit cards. With a home equity loan you borrow against the value of your home, minus any other mortgages. There are two types of home equity loans. A home equity loan that provides a fixed rate for a fixed amount of time, and a home equity loan that allows you to borrow up to a pre-approved credit limit. As you can see there are several mortgage assistance programs available to help you keep your home. Make sure you take advantage of the right one for you. If you are at risk to lose your home to foreclosure or if you are interested in refinancing your mortgage at a lower rate, apply today.