EEM, better known as Energy Efficient Mortgages.

This can take place with FHA loans, Conventional loans, and VA loans, but I am going to go over the particulars when using an FHA loan – the most popular loan type right now.

Eligibility Requirements

• Properties that are eligible are One to Four unit existing and new construction properties.
• Borrowers are approved through the normal FHA mortgage guidelines for obtaining a mortgage.
• The cost of the energy-efficient improvements that may be eligible for financing into the mortgage is the lesser of 5 percent of the property's value, depending on 3 different equations. Please refer to these changes above.
• To be eligible for this mortgage, the energy efficient-improvements must be cost effective, meaning that the total cost of improvements is less than the total present value of the energy saved.
• The cost of the energy improvements and the energy savings must be determined by a home energy rating report which is done by a home energy rating system (HERS) or energy consultant. The HERS report usually costs from $150 to $350 and can be paid by the seller, the buyer, or sometimes included into the mortgage.
• The energy improvements are installed after the loan closes. The money is placed into an escrow account and is released once an inspection verifies the improvements are completed and that the savings will be achieved.
• Because of this program, the final loan amount can exceed the maximum mortgage limit by the amount of the energy-efficient improvements. Here is a list of the FHA max mortgage limits .

Example:

XXXXXXXXXXXXXXXXXXX	New Home/Purchase Price	Same home w/ energy cost of improvements
Purchase Price	$250,000.00	$250,000.00
Loan Amount	$245,471.00	$253,471.00
Cost of Energy Improvements		$8,000.00
Monthly P&I at 5.5% - 30 yr	$1,393.76	$1,439.18
Monthly Payment for electric/gas/ etc, etc	$375.00	$253.00
Total Monthly payment include (Mtg Payment & electric bill)	$1,768.76	$1,692.18
Monthly Savings		$76.58

As you can see, in year 1 you would save $918.96!  Plus the cost of the energy improvements that were added into your mortgage now become a tax write-off!!

Making your home more energy efficient can help reduce high energy bills while improving your level of comfort. As an added bonus, it's good for the environment we all share. NV Energy offers a number of programs and services designed to help our customers save electricity and money. These programs include cash rebates, load-control, weatherization, energy efficient lighting and educational programs.

Start saving now.

Refrigerator Recycling

Old refrigerators or freezers in your garage can use three times as much energy as newer ones. But you can pick up $30 in cold cash just by recycling your older appliance with NV Energy. We pick it up for free and you get $30.

Cool Share (Southern Nevada )

Cool Credit is now Cool Share. Earn incentives and save money on your bill -- while saving energy for us all -- with Cool Share, a program designed to help reduce electricity demand and keep prices low during the peak summer season. Customers already participating in Cool Credit should continue to call 702-402-1111 for maintenance, troubleshooting, or other questions about the program.

Air Conditioning Rebates for Homeowners (Southern Nevada)

When you replace your old air conditioner with a more efficient system (14.5 SEER or higher), you may qualify for a cash incentive ranging from $140 to $ 1125 depending upon the size and efficiency of the air conditioning unit you choose.

ENERGY STAR Lighting

One of the simplest and most effective ways to reduce your energy bills is to replace your existing incandescent light bulbs with ENERGY STAR qualified compact fluorescent lights (CFLs). Right now, NV Energy is working with participating retailers to offer our customers discounts on energy-efficient CFLs. Savings are offered on the types of CFLs at participating retailers while supplies last.

"The good news is that the declines are happening as consumer confidence is rising and housing sales and [building] starts seem to be bottoming out," said Jeannine Cataldi, senior economist for IHS in a statement accompanying the study.

The report claimed the most undervalued metro area in the nation is Vero Beach, Fla., where the median home price has fallen 29.7% since the first quarter of 2005 to $125,400. That is 42.5% below the expectation. Houma, La., prices, at a median of $113,500, are undervalued by 41.4%. Las Vegas prices have dropped more than 46% since 2005, and the city is now undervalued by 40.9%.

5 Most Undervalued

Home prices in these cities are well below normal:

1. Vero Beach, Fla.
Median Home Price: $125.4K
Percent Overvalued: -42.5%

2. Houma, La.
Median Home Price: $113.5K
Percent Overvalued: -41.4%

3. Las Vegas, Nev.
Median Home Price: $140.0K
Percent Overvalued: -40.9%

4. Merced, Calif.
Median Home Price: $106.0K
Percent Overvalued: -40.1%

HERA/HOEPA - Background Information

In 2008, the Home Ownership and Equity Protection Act (HOEPA) and the Housing and Economic Recovery Act (HERA) were passed by Congress, and the Federal Reserve Board published the regulations under the Truth in Lending Act. These regulations were written to provide more transparent, level and fair regulation of the real estate industry; to add additional steps to help prevent deceptive lending practices; and to protect consumers by making them more informed - and therefore more confident- in their home financing choices.

HOEPA - Effective July 30, 2009

Amends the Truth in Lending Act (TIL), implemented through Regulation Z.  Has a number of provisions including the Mortgage Disclosure Improvement Act, which changes the Truth in Lending Act requirements surrounding early and final disclosures to home buyers and addresses the timing of when fees can be charged.

Four key elements you need to know

1. If the home buyer is financing the property, these new regulatory and investor guidelines will impact-and could even dictate-the closing date. 

Historically, home buyers and sellers would agree on a closing date, and then service providers - including lenders - would work as best they could toward meeting that date. Going forward, purchase contracts can still be written with a specific closing date in mind, but all parties need to take into account that the earliest any home purchase transaction can close is 7 business days after the home buyer is issued his or her initial mortgage disclosures from the lender. If the application is taken by phone - and everything went perfectly, the earliest closing date would be 7 business days after application. (Note: At Wells Fargo Home Mortgage, Saturdays, with the exception of federal holidays, do count as a business day for the purpose of disclosures only.)

2. Upfront fees cannot be collected by the lender (except for a credit report fee) until the initial disclosures are received. If the disclosures are overnighted, they are considered "received" the next business day-allowing the fees to be collected on the following business day.

Historically, upfront fees could be collected immediately. Starting July 30, 2009, upfront fees can be collected immediately when the application is taken in person and the home buyer receives his or her initial disclosures. The only exception is the credit report fee which can be collected at application.

3. The homebuyer must be provided with a copy of his or her appraisal a minimum of 3 business days prior to closing.

To help expedite the process, Wells Fargo Home Mortgage has elected to have a copy of the appraisal issued directly to the homebuyer - and the homebuyer must receive the appraisal at least 3 business days prior to the mortgage closing. This means the homebuyer may receive his or her appraisal before or simultaneous to the lender receiving their copy. If the homebuyer believes the 3-business-day required review period is not necessary for whatever reason, he or she has the right to waive that requirement.

4. An increase of more than .125% in the Annual Percentage Rate (APR) from the initial Truth in Lending Disclosure (TIL) requires the TIL disclosure to be revised and reissued to the homebuyer.  The home buyer must receive a revised TIL disclosure at least 3 business days before closing, providing the homebuyer with the time required to determine if the homebuyer is comfortable with his or her loan choice. If mailed, the TIL disclosure is considered "received" 3 business days after mailing.

Considering that many things occur and may be changed or finalized throughout the course of the transaction, there are a number of things that can impact the homebuyer’s APR. Therefore it is critical on the front end to ensure that estimated fees are as accurate as possible.

The Nevada Homestead Act:  Today doesn't mean you can squat on 160 acres of public land and eventually own it, rather it is a means to protect equity in your home against seizure, forced sale by general creditor claims, and judgments that might be entered against you.  The amount of protection was recently increased in Nevada to $550,000.

Here's how it works:  You must own or be buying your home in order to file a Declaration of Homestead. The home must be your principle residence, not a rental or investment property.  It doesn't matter whether you are single, married or an unmarried head of household.  

Be aware that a homestead will not protect you if the judgment or lien is for:  Taxes, the mortgage or deed on the home or mobile home, improvements made on the home or mobile home, mechanics liens and other liens on the home or mobile home, any debt or obligation you willfully and voluntarily incur. 

To protect your property:  All you need to do is: Obtain and fill out a Nevada Declaration of Homestead form, sign it before a notary and print your name beneath your signature, Record it at the County Recorder's office of the county in which the property is located.  There is a nominal recording fee.  You can record your homestead at almost any time, even if you have already lost a lawsuit or had a judgment entered against you.

My Advice:  Filing a Declaration of Homestead is easy and is such a valuable tool that we recommend all Nevada homeowners utilize this very inexpensive means to protect their home equity.   

FHA-approved lenders received the go-ahead to develop bridge-loan products that enable first-time buyers to use the benefits of the federal tax credit upfront, according to eagerly awaited guidance from the U.S. Department of Housing and Urban Development on so-called home buyer tax credit loans that was released today.

Under the guidance, FHA-approved lenders can develop bridge loans that home buyers can use to help cover their closing costs, buy down their interest rate, or put down more than the minimum 3.5 percent.

The loans can't be used to cover the minimum 3.5 percent, senior HUD officials told reporters on a conference call Friday morning.

Thus, buyers applying for FHA-backed financing with an FHA-approved lender that offers a bridge-loan program can get a bridge loan to bring down the upfront costs of buying a home significantly but would still have to come up with the minimum 3.5 percent downpayment.

There remain many sources of assistance for buyers needing help with the 3.5 percent downpayment, including many state and local government instrumentalities and nonprofit lenders.

In addition, some state housing finance agencies have developed their own tax credit bridge loan programs, so buyers in states whose HFAs offer such programs can monetize the tax credit upfront to cover all or part of their downpayment. These programs are separate from what HUD announced today.

The first-time homebuyer tax credit was enacted last year--and improved upon earlier this year--to help encourage households to enter the housing market while interest rates are low and affordability is high. The credit is worth up to $8,000 and is available to households that haven't owned a home in at least three years. The credit does not have to be repaid, and is fully reimbursable, so households can get their credit returned to them in the form of a payment.

Homes on Market:  13,340

Townhome/Condo/Manu:  4,088

All Units in Escrow:  11,053

All Units Sold in 2009:  11,912

Note:  We are on track for a total 2009 year of 35,736 Resales which will break the record for resales sold in Vegas!

This is where I will post pertinent real estate information. This will include text, pictures, videos, and links!

 

You can find me on the web at these properties:

 

You can always email me at: nick@nicknolf.com

 

More soon..

 

Nick Nolf

RE/MAX Las Vegas, NV