Are you thinking of becoming a first-time homebuyer?   Then put on your running shoes and get moving!

Time is quickly ticking by for folks looking to enter the housing market before the $8,000 federal tax credit expires.  That deadline?  November 30, 2009.

Sure, you’re just winding down your summer vacations and getting the kids ready to head back for school.  It’s likely that the last thing on your mind is what will happen after Thanksgiving.  And that could be a mistake.

Why?  You see, because of recent changes in lending laws, mortgage companies are simply unable to close loans as quickly as they used to—even those who are committed to transparency in mortgage lending.    Underwriting that used to take a matter of days now takes weeks.  Appraisals are taking longer.  More homeowners are (wisely) getting home inspections done prior to the sale.  And some homeowners are buying properties under short-sale agreements, which only lengthens the process even more.  As such, it’s wise to count on about 6 weeks to 2 months to go from loan application to the closing table.

That means that RIGHT NOW is the time to be pre-qualifying for your loan and working with a real estate agent to find the right home.

If you’re not sure what the tax credit is, here is a great “fast facts” overview prepared by Chicago Tribune columnist Kathleen Lynn in an article earlier this month:

• The tax credit is equal to 10 percent of the home’s purchase price, up to a maximum of $8,000.
• Buyers can claim the credit on either their 2008 tax return or 2009 tax return. If the closing occurred after April 15, 2009, a buyer can claim the credit on a 2008 tax return by filing an amended return. For more information, go to www.irs.gov.
• The home sale must close by November 30, 2009.
• Full credit is available to buyers with modified adjusted gross incomes of $75,000 (single) or $150,000 (married).  A reduced credit amount is available for people with incomes of up to $95,000 (single) or $170,000 (married).
• Two programs — one state, one federal — offer bridge loans or “prefunds” so eligible buyers can use cash from the credit on their home purchase this year. For more information, go to www.fha.gov.
• Buyers do not need to repay the credit if they occupy the home for at least three years.

So if being in your new home for the holidays is on your wish list—and if you want to get the benefit of a fairly hefty tax credit—lace up your shoes, stretch our your hamstrings and begin the marathon that is buying your first home.

On your mark, get set….GO!

I’m sitting at my desk going through a stack of papers and contracts and checks that somehow seemed to multiply exponentially when I was in California for a few days, and I just realized that I could save a lot of time if I stopped reading things and just started signing things willy-nilly.  And, given the number of not-so-discreet glares and throat-clearing “hints” from the administrative folks around here who are waiting for me to get my part of the job done so that they can do theirs, I discern that there are those in my office who think that I should just put pen to paper and get it all over with.

But here’s my problem:  I actually want to know what I’m signing.   As such, I actually have to read every word of every line of every paragraph because, to be honest, I rather assume that there is language in there somewhere with the potential of throwing me, my companies, my family, my friends, and the flowers along my front walk under the proverbial bus.  And I’d prefer to at least try to avoid it if at all possible.

And a few minutes ago, as I was about halfway through the second ridiculously complex contract that I’d been meticulously reviewing, I thought how much easier life would be if everyone got on board the transparent bandwagon.

I mean, what if this contract read:  “You promise to pay us, and we promise to do what we say we will”?   No loopholes, no hidden agendas—just a promise to do what is clearly spelled out.

Or what if Congress wrote a bill that said “This is what we want to do, plain and simple” rather than burying the intent in 1000 pages of who knows what with some hefty pork thrown in?  Certainly, it would seem to be helpful in avoiding the recent uprisings in town halls across the country—or at least give the “well-dressed protestors” a more specific topic at which to focus their derision.

But, I feel like I can’t download a song off the internet or buy a gallon of milk with my debit card without entering into a binding agreement that might ultimately result in the surrender of my first offspring.  And as you would expect, the bigger the purchase, the greater the fear of potential loss.

And that’s why I can’t help but wonder why anyone would ever work with a mortgage professional who didn’t believe in absolute mortgage transparency.  Who didn’t believe that his or her clients should know—up front—exactly what they were going to pay, and for what, and why.  Who provided this kind of information not because they HAD to, but because they WANTED to.  I mean, if you’re going to invest hundreds of thousands of dollars in a home, why wouldn’t you demand to work with someone who wanted to give you all of the information you needed—in a way that was easy to understand?    The fact is, I would.  And I hope that you would, too.

All right, I just got yet another glare from a certain staff member, so I’d better get back to it.  At the top of my stack is what appears to a 14-page reimbursement request she submitted which begins “For good and valuable consideration” and is riddled with “party of the first part” nonsense.  And I think I see something about a mental health day, a manicure and shoes in here.  Did someone just hear a bus headed my way?

Does anyone else out there think it’s a little funny that the proposals recently approved by the Fed to increase transparency in mortgage lending ran more than 600 pages a piece?    It is for this reason—among a number of others—that I am more than a little concerned about the government’s rather forceful re-entrance of late (and yes, I know that the Fed isn’t “technically” part of the government) into the mortgage lending industry.

I mean, how many pages does it take to say to mortgage lenders and brokers “disclose all of the details”?  How much legalese must be used in order to require “plain English” disclosures?  Only career politicians and those who aspire to be could take a simple, straight-forward idea and make it into such a convoluted mess.

And that’s why I believe that they should—for the most part—keep their hands out of it.

You see, in order for mortgage transparency to truly be effective, it has to come from the inside out.   Government programs, rules and regulations will always have loopholes.  They will always be the result of a compromise—and usually too watered down to be truly effective.  As our tax code easily illustrates, there is virtually always a way to cover up, get around or turn a blind eye to governmental rules.   It will only be when mortgage lenders decide to use open mortgage practices—either because they choose to do business in a more consumer-friendly manner or because homeowners refuse to do business with them if they do not—that true transparency will occur.

Hmm…seems like I got the point across in four paragraphs and I’m not sure how much clearer English could have been used.   Maybe some folks in Washington should get rid of 599 pages and just take one from me.