Market Conditions And Taxes

 As banks are loosening credit, the housing crisis is expected to end this year, which is great news. This is due to the fact that mortgage lending has remained stable over the past three quarters, now in the forth, with the requirements of a credit score of 700. According to banks, they are now lending amounts up to 3.5 times borrower earnings, up from the low of 3.2 times borrower earnings. Banks are also loosening loan-to-value ratios, which Capital Economics denotes “the clearest sign yet of an improvement in mortgage credit conditions.”

With that said, if borrowing and credit conditions return to normal, maybe, just maybe, home sales will increase again!

Homes for sale!

Ulster County Executive Mike Hein is proposing a property tax exemption for first time homebuyers who move into newly constructed homes or buy used existing or renovated homes.

Ulster County Executive Mike Hein wants to keep up the momentum, by keeping first time homebuyers on the Ulster tax rolls. He's proposing to cut their property tax levy over five years by fifty percent in the first year of a newly constructed home sliding down to a 10 percent savings in the fifth year, totaling on average, more than a $1,000 in savings. The same scale would exist for the value of improvements made to existing homes.

"This is hundreds and hundreds of dollars on an annual basis to people," said Hein. "That makes a difference in making a mortgage payment, it makes a…

Wednesday, the Federal Reserve's Federal Open Market Committee voted to leave the Fed Funds Rate unchanged within its current target range of 0.000-0.250 percent.

The Fed Funds Rate has been near zero percent since December 2008.

For the third consecutive month, the Fed Funds Rate vote was nearly unanimous. Just one FOMC member dissented in the 9-1 vote, objecting only to the language used in the Fed's official statement.

In its press release, the Federal Reserve noted that the the U.S. economy has "expanding moderately" since its last meeting in December 2011, adding that the growth is occurring despite "slowing in global growth" -- a reference to ongoing economic uncertainty within the Eurozone.

The Federal Reserve expects moderate economic…

Time is running out to boost to your 2011 federal tax refund. All you have to do is make your January 2012 mortgage payment while it's still December.

It's a simple tax strategy that works because of how mortgage interest is paid, and of how the U.S. tax code is written.

Different from rent which is paid for the month ahead (i.e. "you're paying January's rent"), mortgage payments are made only after mortgage interest has accrued (i.e. "you're paying for money you've already borrowed from the bank").

This is called "paying interest in arrears" and U.S. tax code states that the mortgage interest is tax-deductible in its year paid, subject to limitations.

By making the January 2012 mortgage payment in December 2011, therefore, homeowners who…