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Silicon Valley REALTORS® Charitable Foundation trustee Susan Sweeley and Los Altos/Mountain View District Co-chair Joe Brown are pictured here with Judy Hannemann, board chair for JustREAD.

Silicon Valley REALTORS® Charitable Foundation trustee Susan Sweeley and Los Altos/Mountain View District Co-chair Joe Brown are pictured here with Judy Hannemann, board chair for JustREAD.

The Silicon Valley REALTORS® Charitable Foundation on Dec. 12 presented a check for $2,500 to Judy Hannemann, board chair for JustREAD, a cross-generational program composed of retired professionals in the Los Altos and Mountain View communities who are trained as tutors to teach reading and writing basics to students who did not learn these skills in earlier grades.

The Silicon Valley REALTORS® Charitable Foundation is a trust which makes grants available to organizations from donations by its REALTOR® and affiliate members and friends. SILVAR REALTORS® and affiliates are committed to the welfare and prosperity of the communities where they live and work, and through their charitable contributions and member involvement, strive to help create more productive and enriched communities.

California REALTORS® hailed the Federal Housing Finance Agency’s announcement this week that government-sponsored enterprises Fannie Mae and Freddie Mac will lower down payments to as little as 3 percent for first-time home buyers and permit refinancing borrowers to reduce equity to 3 percent to cover closing costs.

The FHFA decision to lower down payments is in line with its effort to boost the real estate market and expand the pool of first-time home buyers who have been kept in the sidelines even as the housing market has been on the path to recovery. “The new lending guidelines will enable creditworthy borrowers who can afford a mortgage, but lack the resources to pay a substantial down payment plus closing costs, to get a mortgage with 3 percent down,” said FHFA Director Melvin L Watt in a statement released on Monday.

David Tonna, president of the Silicon Valley Association of REALTORS®, applauded the FHFA’s decision to expand access to credit to first-time home buyers. “Despite an improving job market and low interest rates, the share of first-time home buyers in 2014 was the lowest in nearly three decades,” said David Tonna, president of the Silicon Valley Association of REALTORS.

Tonna said according to the 2014 National Association of REALTORS® Profile of Home Buyers and Sellers, the share of first-time home buyers dropped from 38 percent in 2013 to just 33 percent this year. This represents the lowest share since 1987, when the first-time home buyer share was at 30 percent.

“We commend the FHFA’s commitment to expand homeownership and are confident that the underwriting guidelines put in place will mitigate risk,” said Tonna.

Borrowers still need to meet strict criteria under the new programs. Only borrowers who haven’t owned a primary residence within the last three years will be eligible for Fannie Mae’s 3 percent down payment program, which starts Dec. 13. The Freddie Mac program, which will begin in March, is only for borrowers who have never owned a home, those with moderate incomes or are in underserved areas.

Borrowers for both programs will be required to buy private mortgage insurance, provide complete documentation of their income, assets and job status. Borrowers also need a credit score of at least 620 to qualify and are required to receive homeownership counseling.

The income tax exemption on mortgage debt forgiven in a short sale or a workout for principal residences expired at the end of 2013. Without immediate action by Congress, distressed homeowners will have to pay tax on “phantom income” from forgiven debt. Many families have decided not to go through with short sales or seek workouts because of the uncertainty over the status of the waiver. This is not only unfair, but harms families, neighborhoods and communities.

On Wednesday night, the United States House of Representatives passed the bill containing the income tax exemption on forgiven mortgage debt and other expired tax provisions by a vote of 378-46, but the United States Senate has not yet voted on the measure. The National Association of REALTORS® (NAR) is urging all members to contact their senators in Congress and have them extend this tax relief now!

  • Despite significant market recovery, more than 5 million are still “under water.”
  • Nearly 1 million households are seriously delinquent on their mortgages or in foreclosure.
  • Mortgage debt forgiveness tax relief is vital for these families.

TAKE ACTION NOW

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