Exemptions to the Rule include:

1.      Repair/maintenance work where the disturbed area is no larger than 6 sq. ft. of interior painted surface, or 20 sq. ft. of exterior surface;

2.      A certification that the work area is free of lead-based paint (as determined using an EPA recognized test kit, and the kits they sell at Home Depot & Lowes do not qualify)

3.      Renovations by an owner to their own residence. This assumes that the owner is doing the work, not having it done by a property manager or contractor “friend”

4.      Some housing may be exempt if it is shown that no child under the age of 6 or pregnant woman resides or regularly visits there. Check with your attorney to see if you are exempt.

You can view the rule at: http://www.epa.gov/fedrgstr/EPA-TOX/2008/April/Day-22/t8141.pdf and you can also find information and sample checklists at www.epa.gov/lead/pubs/leadinfo.htm#remodeling.

According to various news sources, it is no longer a rumor that the Federal Housing Administration (FHA) will increase down-payments on loans to 5 percent.

The agency’s share of home loans has surged from 3% in 2006 to nearly 30% this year as credit has tightened and borrowers’ bank accounts have been depleted. But that increased exposure has led to more defaults, driving the FHA’s reserves below their mandated levels. The changes will go into effect in the first half of the year.

What’s Happening in the Mortgage Industry?

The Housing and Economic Recovery Act of 2009 (HERA) is a wide-ranging piece of legislation that strengthens and modernizes the regulation of government-sponsored enterprises Fannie Mae and Freddie Mac, along with the Federal Home Loan Banks.

Part of HERA imposes sweeping changes in the lending industry, placing greater focus on consumer protection. HERA aims to assure borrowers are better informed about the loan process and better protected against deceptive lending practices.

These changes, effective July 30, 2009, will have a direct impact on how Realtors® structure their transactions and how lenders keep the consumer informed of loan charges through stricter disclosure requirements.

Four Key Elements

1. If the home buyer is financing the property, the new regulatory and investor guidelines will impact and perhaps even dictate the closing date. In the past, the parties to the transaction agreed upon a closing date and all service providers, including the lender, worked to meet that date.

After July 30, a closing date may still be written into the contract, but the earliest any home purchase transaction can close is 7 days after the homebuyer receives the initial mortgage disclosures from the lender.

2. With the exception of the credit report fee, the lender cannot collect upfront fees until the initial disclosures have been received. Disclosures that are overnighted are considered “received” the next business day (except Saturdays), allowing fees to be collected the following business day.

Historically, lenders could collect upfront fees immediately at the time of application for both telephone and in-person applications. Now, the buyer must receive initial disclosures before any fees can exchange hands. The single exception is the credit report fee, which can be collected at the time of application.

If a lender takes an application in person and delivers the disclosures at that time, the fee can be accepted at that time as well.

3. The homebuyer must receive a copy of his appraisal a minimum of 3 business days prior to closing. A homebuyer who believes the required 3-business-day review period is not necessary may waive that requirement in writing.

4. Any increase of more than .125% in the Annual Percentage Rate (APR) from the initial Truth in Lending Disclosure (TIL) requires that the TIL Disclosure be revised and reissued to the homeowner. The homebuyer must receive the revised TIL Disclosure at least 3 business days before the closing. If the TIL is mailed, it is considered “received” 3 business days after the mailing. It is typical for many details to change during the course of the transaction, including the APR, which can delay the closing.

The APR can be impacted by many details of the market and the transaction, including an unlocked rate, a change in the loan amount, a change to a different loan product, a rate re-lock because of market improvement, a change in closing date, and changes to fees associated with the transaction. If the closing date is critical, it is imperative that the lender ensure that the estimated fees are as accurate as possible.

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Metro Denver’s labor market numbers fared better far than state and national trends in May as the region’s employers added more than 12,000 jobs. The increase was roughly consistent with seasonal norms, while gains at the state and national levels represented some of the weakest hiring for the month of May in years.

A recent Moody’s Economy.com and MSNBC forecast named Colorado among five states most likely to recover first. Economists expect the states – Colorado, Texas, Washington, Oregon, and Idaho – could report growth by year’s end thanks to milder housing downturns, strong energy and technology sectors, and relatively stable household credit.

Nationally, a 2.4 percent increase in May existing home sales represented the first consecutive monthly sales gain since September 2005, according to the National Association of Realtors (NAR). The May sales gain was smaller than expected, however, and total May sales were 3.6 percent below sales from May 2008.

Metro Denver existing home sales increased seven percent between April and May, but sales remained more than 20 percent below 2008 levels.  Public trustees say foreclosure filings declined between April and May in each of the region’s seven counties. Building permit activity rebounded in April after a weak showing in March, but the total count of April permits was less than half of the total from April 2008.

Workforce indicators, improvements in the stock market, consumer confidence, and home sales were among several economic indicators to move in a positive direction this month, according to data compiled by the Metro Denver Economic Development Corporation in its Monthly Economic Summary for June 2009.

Metro Denver’s unemployment rate averaged 7.6 percent through the first four months of the year in what is almost a three percentage-point increase from the average for the same months in 2008. Still, Metro Denver’s year-to-date unemployment rate in April was considerably below the nationwide rate (8.8 percent) and only slightly higher than the statewide rate (7.5 percent).

April foreclosure filings in Metro Denver rose from March as all but two of the seven counties reported increased foreclosure activity. Despite the increase, foreclosures have declined on a year-to-date basis in each Metro Denver county except Boulder County and the City and County of Broomfield. Foreclosures for the region as a whole have fallen 14.2 percent year-to-date.

Additionally, Denver is the No. one U.S. city most clearly ready for a housing rebound, according to a real estate correspondent for the NBC “Today” show. According to the correspondent, “rebound-ready” cities have high rates of job and population growth, high rates of educational attainment, and a good balance between housing supply and demand. She also noted that Denver has an improving foreclosure rate, an expansive park system, and a thriving downtown.

Data from the National Association of Realtors® show the first quarter U.S. median home price of $169,000 was down 13.8 percent from the first quarter of 2008. The Denver-Aurora median of $192,900 declined by a similar 13.7 percent over-the-year.

The American Recovery and Reinvestment Act of 2009 authorizes a tax credit of up to $8,000 for qualified first-time home buyers purchasing a principal residence on or after January 1, 2009 and before December 1, 2009.

The following questions and answers provide basic information about the tax credit. If you have more specific questions, we strongly encourage you to consult a qualified tax adviser or legal professional about your unique situation.

Frequently Asked Questions About the Home Buyer Tax Credit

Bringing the Dream of Home ownership Within Reach

As part of its plan to stimulate the U.S. housing market and address the economic challenges facing our nation, Congress has passed legislation that grants a tax credit of up to $8,000 to first-time home buyers.

Here is more information about how the 2009 First-Time Home Buyer Tax Credit can help prospective home buyers become part of the American dream.

Who Qualifies?

First-time home buyers who purchase homes between January 1, 2009 and December 1, 2009.

Which Properties are Eligible?

The 2009 First-Time Home Buyer Tax Credit may be applied to primary residences, including: single-family homes, condos, town homes, and co-ops.

How Much Will the Credit Be?

The maximum allowable credit for home buyers is $8,000. Each home buyer’s tax credit is determined by two factors:

1. The price of the home - the credit is equal to 10% of the purchase price of the home, up to $8,000.
2. The buyer’s income - single buyers with incomes up to $75,000 and married couples with incomes up to $150,000 - may receive the maximum tax credit.

If the Buyer(s)’ Income Exceeds These Limits, Can He/She Still Get a Credit?

Yes, some buyers may still be eligible for the credit.

The credit decreases for buyers who earn between $75,000 and $95,000 for single buyers and between $150,000 and $170,000 for home buyers filing jointly. The amount of the tax credit decreases as his/her income approaches the maximum limit. Home buyers earning more than the maximum qualifying income - over $95,000 for singles and over $170,000 for couples are not eligible for the credit.

Will the Tax Credit Need to Be Repaid?

No. The buyer does not need to repay the tax credit, if he/ she occupies the home for three years or more. However, if the property is sold during the three-year period, the credit will be recouped on the sale.

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