South Carolina Real Estate Law Blog

The U.S. Department of Housing and Urban Development (HUD) says it will, for 120 days, ”exercise restraint” in enforcing the Real Estate Settlement Procedures Act (RESPA) regulatory rule set to take effect January 1, 2010. The ”final rule“ will require, among other things, that lenders provide borrowers with new Good Faith Estimate (GFE) which HUD hopes will more clearly disclose loan terms and closing costs. In addition, settlement agents will be required to provide a new HUD-1 Settlement statement which will compare borrower’s final costs versus their estimated costs.

The new rules, which HUD estimates will save consumers an average of $700 in settlement costs, went into effect at the beginning of 2009, but provided for a one-year transition period for incorporation of the changes. HUD says it will restrain against enforcing these rules against service providers “who demonstrate a good faith effort” towards implementation.  Among other things, the lender will look at whether the service provide has made “sufficient investment and commitment in technology, training, and quality control designed to comply with the new rule” in determining whether or not a good faith effort has been made.

A copy of HUD’s press release is available online.  You can also visit their website for more information and answers to frequently asked questions.

President Obama signed into law today an extension of the popular home buyer tax credit through June 2010 and an expansion to include people with higher incomes and some who want to trade up into new homes.

The original up to $8,000 credit was scheduled to lapse on Dec. 1 but will now be in effect through the end of June. Homebuyers must sign a contract before April 30 and close by June 30. The income limits were also raised: Single buyers can now earn up to $125,000 and still get the full credit while a married couple can earn $225,000. The bill also made more homeowners eligible to claim the credit on their taxes. First-time buyers — those who have not owned a home in the past three years — still qualify for an $8,000 rebate. But now people who want to trade up can also qualify. Those who have owned and occupied a residence for at least five years out of the past eight can claim up to a $6,500 tax credit if they close on a purchase by the end of June.

The National Association of Realtors has released a comparison chart of changes in the law which you can read by clicking here.

Congress has extended and expanded the homebuyer tax credit which will become effective upon signing by President Obama.  The provisions include an extension of the up to $8000 tax credit until April 20, 2010 and an expansion of the credit to single homebuyers making up to $125,000 per year (formerly $75,000) or couples making up to $225,000 per year (formerly $150,000).  In addition, the new rules provide fo an up to $6,500 tax credit for existing homeowners purchasing a new home.  To qualify, these homeowners must have lived in their current home for at least five of the last eight years.