Interest Rates Have Hit Bottom Low of Less Than 3%!

According to Mortgage News Daily, the fixed mortgage rates are at their all-time record lows! At current rate, the average 30-year fixed rate mortgage are at its all-time record low at 3.38% and the average 15-year fixed rate fell to a new record low of 2.75%. Last year, at the same time, the 30-year Fixed Rate Mortgage averaged at 4.09%, while the 15-year FRM was at 3.29%.

Freddie Mac's Vice President and Chief Economist, Frank Nothaft, said that, "Following the Federal Reserve's announcement of a new bond purchase plan, yields on mortgage-backed securities fell bringing average fixed mortgage rates to their all-time record lows which should aid in the ongoing housing recovery.  New construction on single-family homes rebounded in August, rising by 5.5 percent to the fastest pace since April 2010. 

In addition, existing home sales increased by 7.8 percent in August to its strongest pace since May 2010."

The Federal Reserve's decision to buy mortgage-related debt has helped the housing market by keeping the mortgage interest rates low, thus, encouraging more buyers to invest in Real Estate.

With the current interest rates, buying a home is practically free! More and more buyers are taking advantage of this all-time record low mortgage interest rates. Why don't you?

For more information on the current mortgage rates, you may go to http://www.mortgagenewsdaily.com/mortgage_rates/.

REAL ESTATE TAX TIPS FOR HOME SELLERS

The IRS has recently posted a helpful list of Real Estate Tax Tips on their website to keep in mind when selling a home. It includes:

1. A home owner is qualified to exclude the gain from income if he/she has owned and used the home as their main home for 2 out of 5 years prior to the date of the sale.

2. A home owner may be able to exclude up to $250,000 (for single return) or $550,000 (for joint return) from the gain on the sale of their main home.  There is no need to report the sale on the tax return if they can exclude all of the gain.

However, if the gain cannot be excluded, it will be taxable.

3. A home owner cannot deduct a loss from the sale of their main home.

4. If a home owner bought a home in 2008 and received a first-time home buyer credit, he/she must use the purchased property as their main home for a period of 15 years.  The credit must be paid back over a period of 15 years.  If the purchased property ceases to be the main residence within 15 years, then the owner must repay the unpaid portion of the home buyer credit.

If the first-time home buyer credit was claimed in 2009 or 2010, then the credit is not required to be paid unless the purchase property ceases to be the principal residence of the owner within 36 months from the purchase date of the property.

The repayment must be made whether there was a gain or a loss on the sale of the property.

5. Worksheets are available on http://www.irs.gov/pub/irs-pdf/p523.pdf  to help the home seller figure their income, gain or loss, exclusion and taxable gain on the sale of their home.

6. For any change in address, inform IRS and the US Postal Service.  Form 8822 (Change of Address) is available on IRS website.

For a more detailed explanation on preparing tax returns for home sellers, please refer to http://www.irs.gov/pub/irs-pdf/p523.pdf.

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