When is $7500 not $7500 and when is it a loan and not a grant

Yes, finally, the trick is being found out.<br /><br />Not a single buyer of mine called me and shrieked like Wil Smith came to their house about the $7500 tax credit.<br /><br />People are getting mad instead. They are realizing the credit is just an interest free loan and if the make more than 75k single/150k married man-woman couple, they get even less.<br /><br />We could all get into the whole single, married, unmarried or gay/lesbian couple stuff, but this is a real estate blog. But, why does your heart have anything to do with your money?<br /><br />People need the money for the down payment as an interest free loan, not tax credits. They need realistic underwriting guideline for income, assets and appraisals.<br /><br />They need lower interest rates. The difference between treasury and mortgage backs are bigger than I have ever seen it. Real mortgage rats should be at least a point lower.<br /><br />How about people that need money? In order to refinance and be able to pay things off, they have to take a high rate and pay more when they should be paying less.<br /><br />The other idea (if you have the equity) is to ref with points. The points are deductible not in the year you do the refi, but amortized over the life of the loan.<br /><br />What else? How about getting rid of Freddie and Fannie? Why do we now need them? If each brokerage firm that wants to sell Mortgage Back Securities has their own guidelines. Then we can eliminate Freddie and Fannie’s middlemanness along as the government will step up and put a piece of security in the loans. <br /><br />That’s why the Freddie/Fannie paper got sold. They are quasi-governemental agencies.<br /><br />FHA and VA are insured/guaranteed. All they are are loans. They have specific guidelines. The government does not need to bloat it anymore with separate approvals for lenders, etc. <br /><br />If the Goldmans and Merrills of the world can sell them correctly, great! More brokers (who are getting fully registered, educated and licensed throughout the US) who can write the loans, then the price to consumers go down! Duh!<br /><br />OK, time for the second cup of coffee.

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