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Economy Tanks (again); FHA “As Is”; First Time Home Buyer Tax Credit Attachment

The Stimulus package failed to stimulate, as stocks fell yesterday. In addition, Japan reported its steepest GDP decline on record for the 4th quarter of 2008, Housing Starts were down 17% (far more than expected), Building Permits were way down, and Industrial Production is down. The only thing this bodes well for is interest rates, as long as investors remain willing to absorb all this debt.

Remember once again that FHA Purchases can now be done “As Is”. We received a deal last weak at the 11th hour that was falling apart because the lender had seen the termite report. The lender was requiring all Section One work to be completed before close of escrow, but the work was too extensive so the requirement was a “deal-killer”. Unfortunately, because the lender was a bank, they had no other sources so the agents sent the deal to us. We simply asked for a revised “As Is” contract and made sure the appraiser did not reference any work, and garnered a clean and easy approval. If there is a minor amount of work to be performed, we suggest that you increase to the seller credit for closing costs by an amount sufficient to cover the cost of the repairs (please call us for further explanation).

Also, we have attached a very convenient worksheet setting out the features of the First Time Home Buyer Tax Credit. For the most part, any first time home buyer can get the $8,000 credit as long as he or she purchases a home after January 1, 2009. Some income limits apply, and the buyer must keep the house three years. The credit terminates on December 1, 2009.

Call Jay Voorhees at (925) 855-4491

Real Estate Broker, CA Bureau of Real Estate, BRE# 01524255, NMLS# 335646