Florida Mortgage Report

Economy Gets Stimulated: So Are You Excited?

President Bush signed into law the economic stimulus package we have all heard about.  Even the IRS said today that they will begin mailing checks in May for those who filed 2007 taxes, so make sure you file this last year if you haven't been.  It is "free" money after all, right?

Are you excited to get your money and rush out and spend it?  Are you excited that you can turn your jumbo loan rates into a new conforming loan (limited time offer, contact me for application), maybe even take some equity out so you can rush out and stimulate the economy even further?

I don't know about you, but my money is not going to be spent, rather I will invest it wisely, that way it will actually mean something in the future.

So, what changes occurred that Floridians should know about?

Well, you may qualify for up to $1,800 rebate, or more.  That's pretty cool, even if the rebate is only $300.  So, you need to decide what you "should" do with that money and not just blow it.

Conforming loan limits have been temporarily increased.  That means you may qualify for refinancing your high jumbo rates for a lower "conforming" rate.  I would be happy to help you determine if this is truly in your best interests, as it may not be in reality.

I am not going to get into the nitty-gritty details here as the post would just drag on.  If you want to know more on how the stimulus package can benefit you, especially as it pertains to your mortgage, contact me and I will be happy to assist you.

House Passes $146 Billion Economic Aid Package

The House pushed through their version of the economic stimulus package you likely have been hearing a lot about lately.  The vote was 385-35, but now the package will face issues in the Senate as the Senate version differs from the House, so don't expect a check in the near future, at least not yet.

The plan would send at least some rebate to anyone with at least $3,000 in income, with more going to families with children and less going to wealthier taxpayers.  The House version would speed rebates of $600-$1,200 to most taxpayers.

The Senate version differs as it is a larger package that adds billions of dollars for senior citizens and the unemployed, and shrinks the rebate to $500 for individuals and $1,000 for couples.  The biggest issue between the two versions will likely be that the Senate version would deliver checks even to the richest taxpayers, who are disqualified under the House-passed measure.  The target date to send the bill to the President is February 15, but that looks difficult to achieve at this time. 

I always find it hard to believe how slow the government can work when a bill that helps the majority takes so long, but when a bill that helps the minority passes in just 2 days.  Case in point, the recent change in the retirement age of airline pilots, a change helping the minority while potentially jeopardizing safety.

The question remains not about whether or not there will be an economic stimulus package, but rather when and in what form will that package get approved.  Then we can move on to whether or not it will actually help.

Stimulus Package Means Recession is Over

I am sure you have heard it, but the House has put together a bi-partisan plan to provide tax rebates to stimulate the economy.  That means the recession is over.  Or does it?

The details are basically this, you may receive a tax rebate check from $300 to $1,200 (what I have heard was the max) and that is supposed to get you to spend more money and keep the economy from tanking.  Yeah, that'll be enough to get me to buy that Hummer I always wanted.

Let me make a suggestion, which you can take or leave, but take the money and invest it instead, and I mean throw it into something that will have the potential for great returns, what have you got to lose?  Put the money at risk because you wouldn't have had it anyway.

You think I am nuts?  If you take this money and invest it and the market tanks more, you only lose that money and you continue your life as it ways before you ever received the check.  However, if you invest that money reap great returns, the money will multiply over time, becoming an even greater "stimulus" later.  Your chances are better now that the markets have been beat up for a while, so much so that virtually the only way for the markets to move is up.

So, if and when you get that check, fight the urge to spend it and go out and invest it instead.