The removal of the repayment feature is supported by the National Association of Realtors (NAR), as the organization believes that the repayment portion of the proposal would have discouraged buyers from taking advantage of the new tax credit.
The finalized legislation now includes an extension of the effective dates of the tax credit. The previous expiration date was September 1, now it is set at June 30. Additionally, home buyers who purchase a home in 2009 utilizing state and local mortgage bonds as assistance will be allowed to use the new tax credit as well.
Additional provisions of the plan which could help to energize the real estate market include:
1. Rental assistance. Upwards of $1.5 billion available to provide short-term rental assistance and other types of aid to families throughout the economic crisis.
2. Low- income housing grants. This portion enables states to trade a part of their low-income housing credits for 2009 for Treasury grants in order to finance either the rehabilitation or construction of low-income housing, including those projects with or without tax credit allocations.
3. Energy efficient housing. Grants are available for energy retrofitting of federally assisted housing (commonly known as Section 8), funding available to states for energy efficiency and block grants, also for certain types of upgrades, the residential tax credit has been extended through 2010.
4. FHA and conforming loan limits. It has been reported that the plan includes the extension of 2008 limits throughout 2009, except in areas where this year's limits are higher. Increases in individual communities may be granted by the Secretary of the U.S. Dept. of Housing and Urban Development.
5. Rural Housing Development. Funding increased for the Rural Housing Service including direct and guaranteed loan programs.
6. Tax-exempt housing bonds. Specified state and local bonds issued throughout 2008 and 2009 will receive tax-exempt interest and will not be subject to the AMT (alternative minimum tax). Additionally, financial institutions will now have greater ability to purchase state and local tax-exempt bonds.
7. Transportation infrastructure. Upwards of $29 billion will go towards highway construction projects, $8 billion for rail, and $5 billion to weatherize low-income housing.
8. Foreclosure mitigation and neighborhood stabilization. Funds will be available for localities and states to assist in the rehabilitation of foreclosed and/or abandoned properties. (Reportedly upwards of $2 billion)
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