Our Friends at WINA reported recently that Charlottesville has been named as a “best place” by yet another national magazine.
Charlottesville ranks high in more national publications
More national publications have given high rankings to the Charlottesville area. Black Enterprise Magazine has rated Charlottesville as the 2nd Best Place to Retire. The ranking is based on healthcare, housing prices, public schools, crime levels, traffic congestion and commercial air access. Many of the 20 locations recognized by Black Enterprise Magazine are in the South due to the mild climate, but only Charlottesville and Virginia Beach, which was ranked #9, were chosen from Virginia. The Charlottesville area also has been ranked 13th in the Nation for Raising a Family by Forbes Magazine. One of the factors cited by Forbes is the area’s high average SAT score of 1098, which is among the best in the nation.
Hearty congratulations go out to Carol Clarke of Montague, Miller & Co. upon her selection as VAR 2008 REALTOR® of the Year! Carol was singled out from over 36,000 VAR members as personifying the qualities of a truly outstanding REALTOR® in the state of Virginia. She has shown commitment to local, state, and national issues throughout her years of service and repeatedly demonstrates leadership in both her business and personal lives. She has served as both CAAR and VAR president and is currently Chair of the Virginia Real Estate Board. We have benefited from her dedication both here in Charlottesville and across the state, so please take a moment to join us in thanking her for her service and congratulating her on a well-deserved accolade!
The IRS has released IR-2008-106, providing some guidance about how individuals who utilize the new $7500 first-time homebuyer tax credit will reflect the credit on their tax returns and receive the benefit from any refund. The notice reinforces the fact that taxpayers will be required to repay the credit, starting with their tax return for 2010, which will be filed in 2011.
The IRS is designing a new Form 5405 for those who utilize the credit. The new form will be included in the Form 1040 packet and filing instructions that are distributed in late December and early January. The new form is not yet posted on the IRS website. While it has not yet officially announced its plans, the IRS will likely use the information on this new form to track the group of taxpayers who use the credit and provide them with instructions on how to make the repayment. This guidance will be issued later.
The notice is issued in Q&A format and addresses only fundamentals about the credit. The reminders provided are descriptions of the amount of the credit, the homes that qualify, the income limits and the exceptions to the repayment requirement.
View key provisions >
Homebuyer Tax Credit FAQs >
Seller-funded downpayment provision >
(from NAR)
On September 12, 2008, the US Department of Housing and Urban Development (HUD) released Mortgagee Letter 2008-23 outlining new downpayment and maximum mortgage requirements as found in the Housing and Economic Recovery Act of 2008 (HERA). This letter implements three new requirements:
- mortgagor will pay in cash or cash equivalent not less than 3.5 percent of the appraised value of the property;
- the variable loan-to-value (LTV) limits that were based on the combination of property value and average state closing costs (known as “downpayment simplification”) is eliminated; and
- the Federal Housing Administration (FHA) insured first mortgage is limited to 100 percent of the appraised value and requires the inclusion of the upfront premium within this limit. The revised requirements take effect for all new FHA case number assignments on or after January 1, 2009.
The mortgage letter states that closing costs may not be used to help meet the minimum 3.5 percent downpayment requirement. The LTV is 96.5 percent (the reciprocal of the 3.5 percent downpayment requirement). However, when combined with an FHA first mortgage, government subordinate liens are not limited to 100 percent. Sellers are still permitted to provide financing concessions of up to 6 percent of the sales price. Refinances, including FHASecure, are not subject to the 3.5 percent downpayment requirement as there is no “downpayment” on a refinance.
Federal legislation was recently signed by the President to require national registration of all employees originating or processing mortgages for banks, and to require the state licensing of loan originators and mortgage companies.
Virginia is required under federal law to establish a licensing program for loan originators by October 2009, to include:
- An application process including background checks, “pre-licensing education and a written exam
- Annual continuing education requirements and curriculum
- Investigatory and enforcement procedures
There are large parts of the federal legislation that will need interpretation. The Virginia General Assembly, along with most other state legislatures, will be identifying the appropriate issues that need to be addressed. The Virginia Association of Realtors has been asked to work with members of the legislature to help identify these issues and to help in the development of legislation that could come before the 2009 General Assembly.