Voice for Real Estate 60: FHA MIP Reduction, Debt Cancellation


Update: 
On January 20, HUD announced it has suspended FHA's MIP reduction. NAR President William E. Brown expressed disappointment with the decision. "According to our estimates, roughly 750,000 to 850,000 homebuyers will face higher costs and 30,000 to 40,000 new homebuyers will be left on the sidelines in 2017 without the cut," Brown said. "We're disappointed in the decision but will continue making the case to reinstate the cut in the months ahead."


Originally posted Jan. 10, 2017:

2016 was the last year mortgage debt cancelation relief applies. The rule prohibits the IRS from taxing mortgage debt forgiven by a lender. NAR is working with Congress to get the relief passed for 2017. Whether or not that happens, you can let underwater homeowners know that if they have a signed agreement from 2016 to get debt forgiven in 2017, that forgiven debt won't be taxed even though it occurred in 2017. Get more on this the latest Voice for Real Estate news video from NAR.  

Featured Segments

  • FHA MIP reduction
  • Mortgage debt cancelation relief
  • Customers with a criminal record
  • Using social media
  • 2017 sales forecast
  • Saving for a downpayment

Transcript

Important news on for struggling homeowners!

Are you working the right way with customers who have a criminal record?

And a top broker shares how she plans to use social media to succeed in 2017

These stories and more on The Voice for Real Estate.

Hi, I’m Stephen Gasque with the National Association of Realtors, wishing you a happy new year. And this year there’s good news right out of the starting gate—less expensive FHA loans.

The U.S. Department of Housing and Urban Development on January 9 announced a quarter-point decrease in the annual mortgage insurance premium that borrowers pay for FHA loans.

The premium on a $625,000, 30-year, fixed-rate loan will now cost only 55 basis points. That’s down from 80 basis points in 2016. And on a 15-year loan of that same amount, the premium is only 25 basis points, down from 45.

On average, home buyers will save $500 a year in insurance costs.

The new rates take effect January 27. You can get all the information at NAR.REALTOR. Just search “2017 FHA mortgage insurance premium reduction.”

[SWOOSH]

One of the most important tax provisions to help struggling home owners—mortgage debt cancellation relief—expired at the end of 2016. That provision prohibits the IRS from counting any home mortgage debt a lender forgives as income on a taxpayer’s return. However, the Ntl Assoc. of Realtors wants it back on the books. So, NAR making sure Congress knows just how important it is to reauthorize that tax provision for 2017. That’s a big help for homeowners who are already struggling financially. We’ll keep you posted as efforts pick up to pass new relief for 2017.

In the meantime, though, there’s important information you can tell homeowners about. First, if they had mortgage debt forgiven in 2016, they may be eligible for debt cancellation relief when they do their 2016 taxes. And second, if they have a signed agreement from last year to get mortgage debt forgiven this year—in 2017—they are eligible for that relief in 2017. NAR’s Evan Liddiard has more.

[QUOTE]

Mortgage debt cancellation relief is just one tax issue NAR will be focusing on this year on Capitol Hill. We’ll have more on all of the issues that affect your business as they come up.

[SWOOSH]

What’s the best way to use social media to build your business? One thing you don’t want to do is use Facebook and other sites just to publicize your listings, because that can be a big turn-off to the people who follow you, says NAR Vice President Mabel Guzman, a real estate broker with @properties in Chicago. Guzman talked about her use of social media during a recent Facebook Live conversation with Nobu Hata, NAR’s director of member engagement.

[QUOTE]

Guzman also shared tips for prospecting, selling distressed properties, and how to provide valuable information to clients…even if they already know a lot about the neighborhood where they’re selling or buying.

[SWOOSH]

What’s the correct way handle – a client with a criminal record?

As we know, some rental applicants or home buyers have a criminal record. And last year the U.S. Department of Housing and Urban Development came out with guidance on how to stay within federal Fair Housing laws while working with those clients. That guidance raised a lot of questions from housing professionals who want to abide by the law while making prudent decisions about risk. Here’s NAR Associate Counsel Lesley Walker with steps you can take to meet both of these goals.

[QUOTE]

Walker shares her advice in the latest Window to the Law video from NAR Legal Affairs.

[SWOOSH]

Home sales in November were at a solid 5.61 million-unit sales pace. And NAR Chief Economist Lawrence Yun expects sales to increase by 1 to 3 percent from that level in 2017. That’s because the economy, and jobs, continue to grow. There are risks in the months ahead, though. The first is the continued housing shortage. There’s only a four-month’s supply. That’s a far cry from the 6 to 7 months supply that Yun says is a balanced market. The second risk is rising mortgage rates. Yun talked about that at a December news conference in Washington.

[QUOTE]

We’ll have updated numbers on home sales and contract closings later this month, and we’ll be bringing you those numbers and Yun’s analysis of what they mean.

[SWOOSH]

It’s a new year, and Real Estate Today – is getting back to the basics. Real Estate Today is the official radio program of the Ntl Assoc of Realtors, and we’re kicking off 2017 with a special series of shows about buying, selling, investing and more. One big issue: saving up for the down payment!  We talked to national financial expert Laura Adams, host of the top-rated Money Girl Podcast,’ how to save a lot of money – in just a little bit of time!

(sound)

You can listen to Real Estate Today on your hometown radio station…or visit us online, at Radio.realtor.

(swoosh)

And that’s our show for the week of January 9. You can get more on everything we talked about today on The Voice for Real Estate page on NAR.REALTOR. Thank you for joining us, and be sure to join us again when we bring you all the real estate news on The Voice for Real Estate.

Advertisement