Extra Credit
You know that your credit score is one of your most precious resources — a good score can open doors and save you money. But what if your score got a little bruised amid the recent credit crunch? Don’t fret. Max out your credit rating with these tips for repairing the damage.

·Order your credit reports from the top three credit bureaus — Equifax, Trans-Union and Experian. It’s likely that each is slightly different. Creditors aren’t required to report to all three credit bureaus, so they typically report only to the credit bureau to which they also subscribe.

  Don’t go overboard on holiday decorations. Large decorations can make your home seem smaller and they can distract buyers. If you choose to decorate, opt for fewer and smaller items with a general winter theme.   Hire a reliable real estate agent.Ask family and friends to recommend a Certified Residential Specialist (CRS) REALTOR® who willwork hard for you and be available during the holidays.   Seek motivated buyers. Any person shopping for a home during the holidays must be highly motivated. Target buyers who need to move soon, such as people relocating for jobs, college students and university staff on break, and investors on tax deadlines.   Price the property to sell. No matter what time of year it is, a home that’s priced appropriately for the market will attract buyers.   Pay attention to curb appeal. Maintaining your home’s exterior is just as important in the winter as it is during any other season. Touch up the paint, clean the gutters and spruce up the yard. Also keep buyers’ safety in mind by keeping stairs and walkways clear of snow, ice or leaves.   Use high-quality photos and/or a video tour to market your home on the Web. Homebuyers are likely to start their home search on the Internet, so these tools can help buyers who may not have time to visit your home in person.   Make your home cozy and inviting. When showing your home, crank up the heat, play soft music and offer homemade holiday treats. It will encourage buyers to spend more time in the home, which gives them a chance to admire its best features.

FEATURE		Jan 1 – November 30, 2009	December 1 – April 30,
		Rules as enacted February 2009 $8000	2010 Rules as enacted November 2009 $8000
First time Buyer – Amount of Credit		($4000 married filing separate)	($4000 married filing separate)
First time Buyer – Definition for Eligibility		May not have had an interest in a principal residence for 3 years prior to purchase No Provision	Same$6500
Current Homeowner Amount of Credit	–	No Provision	($3250 married filing separate)
Effective Date – Current Owner		No Provision	Date of Enactment Must have used the home
Current Homeowner – Definition for Eligibility		Purchases after	sold or being sold as a principal residence consecutively for 5 of the previous 8 years Purchases after
Termination of Credit		November 30, 2009.(Becomes April 30, 2010 on Date of Enactment.)None	April 30, 2010 S
Binding Contract Rule		$75,000 – single	o long as a written binding contract to purchase is in effect on April 30, 2010, the purchaser will have until July 1, 2010 to close.
Income Limits (Note: Increased income limits are effective as of date of enactment of bill)		$150,000 – marriedAdditional$20,000 phase out None	$125,000 – single $225,000 – marriedAdditional$out20,000 phase $800,000
Limitation on Cost of Purchased Home		No Provision	Effective Date of Enactment Ineligible
Purchase by a Dependent		None	Effective Date of Enactment Purchaser must attach
Antifraud Rule			documentation of purchase to tax return

 

 Safe House
Summer seems to bring out the home-improvement expert in everyone. It’s the perfect time to tackle those projects — large and small — that have been lingering. And whether you’re bringing out the lawn mower for the first time, getting ready to clean the gutters or repairing odds and ends, consider these important safety tips:

Mowers • Before mowing the lawn, do a walk-through of the area and remove any large sticks or debris. • Wear clothing that offers protection, like sturdy closed-toe shoes and safety glasses or goggles. • Do not clean the grass exit of a mower by hand, and keep the mower on grass, not pavement, which can kick up debris.

Ladders • When using a ladder, place it on level ground and open it completely, making sure all locks engage. • Always face the ladder when climbing and use slip- resistant shoes. • Stand at or below the highest safe standing level on a ladder. For extension ladders, it’s the fourth rung from the top.
Power Tools • Remember to keep
tools away from heat,
oil and sharp edges. • Disconnect tools when they’re not in use or when you’re replacing a blade, bit or part. • Keep your work areas well lighted and wear gloves and appropriate footwear when using tools.

Under 5%, Mortgages May Be Near The Bottom
REAL ESTATE MARCH 20, 2009
By JAMES R. HAGERTY
The Federal Reserve is going to extraordinary lengths to push down long-term interest rates, including
home-mortgage rates. But those hoping mortgage rates will fall sharply from current levels, already
historically low, may be disappointed.
Mortgage firms Thursday were quoting rates averaging 4.75% on 30-year fixed-rate mortgages, according to
Zillow.com, a real-estate information service. That is down from more than 5% two days ago and about 6% in
mid-November. But further big declines will be hard to achieve, partly because the mortgage-lending market
has grown less competitive in the past year as hundreds of small banks and independent mortgage lenders
have collapsed. The big banks that dominate the market are eager to boost their profits margins, not give
deeper bargains to consumers.
Rates for borrowers with the strongest credit are likely to be in a range of roughly 4.5% to 4.75% for the rest
of this year, says Mahesh Swaminathan, a mortgage strategist at Credit Suisse in New York.
Others say that is too optimistic. Assuming no big change in government policy, Walter Schmidt, an analyst
at FTN Financial Capital Markets, sees a range of 4.75% to 5.5% for most of this year.
The Fed began driving mortgage rates down in late November when it announced plans to buy as much as
$500 billion of mortgage securities this year. On Wednesday, the Fed expanded that program, saying it will
spend as much as $1.25 trillion on such securities in 2009. That is enough to provide funding for more than
half of all home-mortgage loans likely to be made in the U.S. this year.
The Fed also is buying long-term Treasury bonds to drive down rates on those securities, whose pricing
affects mortgage rates.
By historical standards, rates look incredibly low. Until recently, 30-year fixed-rate mortgages hadn't been
below 5% since the 1950s. For the past couple of months, rates have been bobbing between about 5% and
5.25%. The 30-year rate averaged 4.98% in the week ended March 19, down from 5.03% the prior week,
Under 5%, Mortgages May Be Near The Bottom - WSJ.com Page 1 of 3
http://online.wsj.com/article/SB123750531250489895.html 3/20/2009
according to Freddie Mac's survey. Fifteen-year fixed-rate mortgages averaged 4.61%, down from 4.64%.
One reason mortgage rates often tick back up after a decline is that a rush of people seeking to refinance
quickly causes backlogs at lenders, which frequently don't have enough employees to process all of the
applications.
"If lenders are working people overtime to close loans, they don't have an incentive to compete too hard on
price," says Arthur Frank, who heads research on mortgage securities at Deutsche Bank in New York.
The situation highlights a conundrum for the government. It wants low rates to spur the housing market, but
also wants the banks to make profits on loans so they can return to financial health.
Many of the small mortgage banks that remain are struggling. Mortgage banks, often small, family-owned
companies, aren't licensed to take deposits and so lack that source of money for their loans. Instead, they
typically borrow money for short periods from so-called warehouse lenders. They use this short-term credit
to make loans to their customers and then pay back the warehouse lenders after selling the loans to bigger
banks or to government-backed mortgage investors Fannie Mae and Freddie Mac.
But this warehouse credit is much harder to obtain than it was a year or two ago because many of the big
banks and Wall Street firms that used to provide it have exited that business.
Despite these constraints, the Fed's action is "going to be a plus" for the housing market, says Thomas
Lawler, an economist in Leesburg, Va. Lower rates make it more likely that home prices will hit bottom in
many parts of the country later this year, Mr. Lawler says. The recovery, though, is likely to be gradual, partly
because rising unemployment reduces housing demand.
Christopher J. Mayer, a real-estate professor at Columbia Business School in New York, says the Fed's moves
to cut rates are "helping to put a floor under the housing market." But he worries that the Fed could face huge
losses on the mortgage securities if inflation fears eventually push interest rates much higher.
Still, the consumers who need these low rates the most aren't likely to get much help. Many people can't
qualify for these low rates because their credit scores aren't high enough or they can't afford a down payment
of 20% or more on a home purchase. Such people will be socked with fees that can drive up their housing
costs considerably. Banks also have become far pickier about appraisals and are nixing many purchases as a
result.
Others can't qualify for a refinancing because they owe far more on their homes than the estimated current
market values. Fannie Mae and Freddie Mac have new refinancing programs that will let some borrowers
refinance into lower rates even if they owe as much as 105% of the home value, but only for current loans
owned or guaranteed by Fannie or Freddie.
Write to James R. Hagerty at bob.hagerty@wsj.com
Printed in The Wall Street Journal, page C1