Real Estate, Home Loans & Identity Theft!

http://www.seattlepi.com/local/406129_fha12.html

By AUBREY COHEN
SEATTLEPI.COM STAFF

Home buyers will be able to use the federal $8,000 first-time home buyer tax credit for down payments on Federal Housing Administration loans, U.S. Housing and Urban Development Secretary Shaun Donovan announced Tuesday.

"We all want to enable FHA consumers to access the tax credit funds when they close on their home loans so that the cash can be used as a down payment," Donovan said at the National Association of Realtors' Midyear Legislative Meetings & Trade Expo in Washington, according to a printed copy of the remarks released by HUD.

FHA will allow approved lenders and nonprofits, and state and local government agencies to issue short-term bridge loans buyers can use for down payments, Donovan said. Buyers would repay the loans after getting their tax refunds.

Donovan said FHA would soon release details on the new program.

Last month, the Legislature approved a program to provide the credit as a temporary loan, although that has since run up against an IRS rule barring taxpayers from designating someone else to get their refunds.

"A lot of people are working on the IRS issue, including the National Association of Realtors, and my understanding is we're pretty close on getting that put into place," said Erik Hand, president of Response Mortgage Services, which is real estate company John L. Scott's mortgage branch.

FHA loans fell out of favor during the housing boom, with the explosion of privately funded subprime mortgages. But the subprime market has all but disappeared over the past two years, and FHA's nationwide market share surged from 1.9 percent in the fourth quarter of 2006 to 23.7 percent at the end of last year, according to HUD.

Don Riley, executive vice president of Windermere Services, said 60 to 65 percent of first-time buyers in the Seattle area use FHA loans, which allow people to buy with as little as 3.5 percent down.

Allowing use of the tax credit for down payments essentially turns the credit into a form of down payment assistance. The FHA allows government agencies and nonprofits to give buyers down payment assistance, although it recently barred such assistance from home sellers.

HUD officials said mortgages with seller-funded assistance had higher default rates, largely because sellers often built the assistance into the price, meaning buyers were essentially financing the entire purchase. Hand noted that the same was not true of loans with government and nonprofit assistance.

I've recently been educated about the seriousness with Identity Theft. Arizona being the #1 state and the Phoenix metro area being the #1 city for Identity Theft. The statistics used to be 1 of 10 would be a victim, now they are estimating it to become 1 of 3 will become a victim of Identity Theft by the end of this year. I have become an associate with Prepaid Legal to provide education and awareness regarding this epidemic which I don't foresee going away. With so many credit monitoring companies, how do you choose the right service? Well, I've found that most companies only provide monitoring which would be the first signs that your identity has been stolen. Most companies don’t tell you the other forms of ID Theft such as medical, driver’s license, social security and criminal/character in addition to the financial we’re all aware of. Prepaid Legal has partnered with another 30+ year company, Kroll Worldwide, to provide full restoration services in all five areas of identity theft. Kroll partnered with prepaid legal as most effects of ID Theft do become legal issues. I have included a link to a video recently shown on MSNBC and how this issue could have been handled by the attorneys and a world renowned risk management company. My website within the next month will have vital information about Identity Theft and the services that are provided.

http://today.msnbc.msn.com/id/26184891/vp/30344575#30344575

I encourage your questions and comments which I would like to you to share on this blog.  This will give others the opportunity to see Q & A's from others.