Last Friday we broke the news about legislation for a tax credit for first-time homebuyers — which was a much more complicated version than the one on Biden's campaign platform. Today, Senior Mortgage Reporter Georgia Kromrei digs deeper into the legislation to find out who would benefit and what the implications are for lenders.
First, the pros. As written, up to 4.37 million current renters would be eligible for $20,000 in down payment assistance, many among under-served populations. And a good chunk of them would qualify for up to $25,000. That's good news in its own right, and the targeted approach makes sense given the overheated demand for housing right now. It was probably also a relief to private mortgage insurers.
But there are some cons, mainly, the complexity of figuring out who qualifies and the added time and cost it could bring to the closing process. As Tim Rood, managing director and head of government and industry relations at SitusAMC, notes: "Operationalizing this is a challenge. You're going to have to make it simple to incent participation instead of punishing misapplication."
It's that "punishing misapplication" that has some lenders worried. Will the CFPB and other regulators consider good-faith efforts as lenders try to work through the details? Or will they look for "gotcha" opportunities even as some parts of implementation are unclear? The success of the program — clearly well-intentioned — may lie in the distinction.
Mortgage Marketing Radio's Geoff Zimpfer and HW Media Founder and CEO Clayton Collins discuss the latest developments on President Joe Biden's proposed first-time homebuyer tax credit, and whether we will see a housing crash.
Servicers can make a difference to homeowners impacted by COVID-19. Fannie Mae's one-stop toolkit has all the information you need to answer homeowners' questions about forbearance and post-forbearance options. Visit the Toolkit.
HousingWire's Clayton Collins joins On Q Financial President and Founder John Bergman to discuss how and why lenders should give back to their communities, and the unique opportunity On Q Financial had recently to help a family in need. Presented by On Q Financial
HousingWire, 433 East Las Colinas Blvd., Suite 830, Irving, TX 75039, (469) 893-1480
EmoticonEmoticon