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Christie Cannon


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Understanding the New Conforming Loan Limits in Our Area Dallas, Texas

by Christie Cannon

We have seen a whirlwind of legislative activity these past few weeks! There is much confusion surrounding the recently passed Economic Stimulus Package and higher loan limits. Unfortunately, the new law can be confusing to decipher, and not everyone will benefit. For this reason, we have provided an outline below that clarifies what this new law means for you and how you can benefit from the higher loan limits.

Description and Overview:

An economic stimulus package just passed Congress on February 7, 2008 and was signed into law by the President on February 13, 2008. This new law is effective immediately and includes a temporary increase in both the FHA and conforming loan limits to as high as $729,750 in high cost areas. This means that the interest rates on many mortgages will go down because these loans are now eligible to be purchased by Fannie Mae and Freddie Mac or insured by the Federal Housing Administration (FHA). Previously, the FHA was only allowed to insure loans with balances lower than $200,160 - $362,790, depending on the county where the property was located. Also, Fannie Mae and Freddie Mac were only allowed to purchase loans with balances at or below $417,000. This resulted in limited options and higher financing costs for those with loan balances above these limits. The new law substantially increases these limits in high cost areas and opens up new options and lower financing costs for many people.

How to Determine "High Cost" Areas

There are two things you must know in order to determine if you are in a high cost area:

1.    Understanding the Formula

If 125% of the local area median home price exceeds $417,000, the temporary loan limit would be that 125% of the median home price with a cap of $729,750. Here are three examples to illustrate this concept:

If the median home price in your area is $225,000, 125% of that number is $281,250. This is below the current $41 7k conforming loan limit. Therefore, the conforming loan limit in your area will not change. However, if $281,250 is greater than the FHA limit in your county, your FHA limit will go up to $281,250.

If the median home price in your area is $375,000, 125% of that number is$468,750. This is above the current $41 7k conforming loan limit. Therefore, the conforming loan limit in your area WILL change and go up to $468,750. This number is also higher than the highest FHA loan limits, so therefore your FHA loan limit will also go up to $468,750.

If the median home price in your area is $650,000, 125% of that number is $812,500. This number is greater than the maximum cap of $729,250. Therefore, the conforming loan limit in your area will  increase to highest allowable amount under this new law which is $729,250.

2.    Determining the Median Home Price in Your Area

The Secretary of Housing and Urban Development (HUD) will publish the median house prices within 30 days of the bill going into effect (30 days from February 13, 2008). HUD does not have any interim stats or information for us to use. However, the bill also states that HUD can use any commercially available data if they are unable to compile the information on their own within the 30 day timeframe. With that in mind, it is likely that HUD’s numbers will be relatively consistent with the data published by the National Association of Realtors (NAR), which already has a solid track record of tracking and publishing this information on a quarterly basis.

Therefore, until HUD actually publishes their version of the median home prices, the most accurate way to get this information today is to utilize the data that is published by NAR. Ironically, NAR just released their latest median home price update for the 4th quarter of 2007 on February 14, 2008! Contact me today and I’ll research your info and let you know exactly what the median home price is in your area and how you can benefit from this information.


What do all the dates mean?

There is some confusion because the bill has a provision that says the higher limits are only effective for loans originated between July 1, 2007 and December 31, 2008. In short, the reason it is effective beginning July 1, 2007, is because the credit crisis started to unfold in July and August of 2007. Mortgage market conditions rapidly deteriorated almost overnight. Many secondary market investors suddenly refused to purchase loans that couldn’t be sold to Fannie Mae and Freddie Mac. (For more info on how this process works, please see the article entitled Saga of the US Mortgage Industry.)

Unfortunately, many mortgage banks had already funded these loans in their own portfolio or through their warehouse lines of credit. Their intention was obviously to sell these loans on the secondary market after the loans were funded. However, the credit crisis prevented them from doing so, and they were stuck holding these loans in their portfolio. The July 1, 2007 date in the bill is designed to allow these lenders to unload these mortgages and sell them on the secondary market to Fannie Mae and Freddie Mac.



However, the July 1, 2007 date has no bearing whatsoever on new refinance transactions! In other words, it doesn’t matter when the loan you are refinancing was originated. The old loan could have been originated in 2005, 2006 or anytime before or after July 1, 2007 and it would have no effect whatsoever on your current purchase or refinance transaction. If you are refinancing a new loan today, whether it is a purchase or refinance transaction, that loan is subject to the new limits set forth in the bill.

The other date of December 31, 2008 means that the old limits will go back into effect after this year. In other words, now is the perfect time to buy a new home or refinance your mortgage because after this year, your costs will be higher and your options more limited again.

When does this all go into effect?

February 13, 2008 – immediately upon the President’s signature. Therefore, HUD is obligated to publish the median home prices within 30 days of that date. However, Fannie Mae, Freddie Mac, and various wholesale lenders may have different policies as to how these new loans are going to be priced and underwritten.

Feel free to call me, Christie Cannon, if you have questions regarding a specific area and I would be delighed to find out if it qualifies for a higher limit under the new guidelines.  My direct line is (469) 951-9588.  I can also get you in touch with a well qualified Mortgage Planning Specialist that can assist you with your specific questions regarding refinancing or obtaining a new home loan.


Report: Dallas-Fort Worth home prices least likely to drop

by Christie Cannon


Report: Dallas-Fort Worth home prices least likely to drop

07:30 AM CST on Wednesday, January 16, 2008

By STEVE BROWN / The Dallas Morning News

Dallas-Fort Worth's housing market is the least likely of any in the country to see a decrease in home values, a new report confirms.

At the same time, the chances of a house price decline rose in almost four out of five U.S. markets, according to a report released Tuesday by mortgage insurance firm PMI Group.

Dallas and Fort Worth ranked dead last in PMI Group's latest forecast of cities with the biggest chance for a home price shakeout.

Analysts with the California-based company estimate that Dallas-Fort Worth has less than a 1 percent chance of marked home price drops in the next two years.

By comparison, cities in California, Nevada and Arizona have more than an 80 percent likelihood of falling residential values.

"We're seeing an increasingly polarized market," PMI economist David Berson said in a news release.

"The risk that home prices will be lower in two years has increased for many of the largest cities in the nation, although areas that saw only moderate home price gains during the 2002-to-2005 period still generally have low risks of price declines," he said.

That's certainly the case in Dallas-Fort Worth, where home price appreciation during the last five years has been a fraction of the national average.

"Because Texas did not participate in the double-digit home price gains in the first half of the decade, it doesn't have to take the great pain of the areas that are compensating for that now," Mr. Berson said in an interview.

Now that the housing sector is in a slump, home values in North Texas have been relatively flat while they are falling in many other major U.S. cities.

In 2007, the median price of homes sold through the North Texas Realtors' multiple listing service was up 1 percent from 2006.

Texas markets – including the D-FW area – were also less affected by investors who ran up prices in some cities, Mr. Berson said.

And most Texas cities are outpacing the rest of the country in overall economics, he said.

"The state economy is doing pretty well, and job growth is above the national average," Mr. Berson said.

"It's quite likely Texas will be doing better than the national average for the foreseeable future," he said.

The D-FW area has gotten high marks in the PMI risk report before.

And other national surveys show that North Texas' housing market is outperforming those in the rest of the country.

Even so, pre-owned home sales were down about 8 percent last year, and sales of new homes fell about 17 percent in 2007.

Foreclosure rates also continue to rise.

Analysts are therefore keeping a close eye on D-FW home prices for signs of deterioration.

"I can't argue with the PMI risk assessment, but it doesn't mean that it still couldn't happen – just not as likely as elsewhere," said Dr. James Gaines, an economist with Texas A&M University's Real Estate Center. "So far, most Texas markets are doing well.

"The metroplex probably will do well to have positive overall appreciation, but pockets within the metroplex will have a rough time for a while."

Indeed, Mr. Berson said, the Texas housing market isn't bulletproof.

"There are no sure things," he said.

"It's possible that some parts of Texas will see some declines in the near term."

But overall, the outlook for the local housing market is good, he said.




Markets with the most and least risk of a home price decline, based on price appreciation, economic growth and affordability according to PMI Group, one of the country's largest mortgage insurance firms. An index of 100 means there is a 100 percent chance of home prices falling in the next two years.




Riverside, Calif. 94

Las Vegas 89

Phoenix 83

Santa Ana, Calif. 81

Los Angeles 79




Fort Worth Less than 1

Dallas Less than 1

Pittsburgh Less than 1

Houston Less than 1

San Antonio Less than 1



Dallas home prices rise among few U.S. gains

by Christie Cannon
Dallas home prices rise among few U.S. gains
Industry experts say foreclosures a concern
11:15 AM CDT on Thursday, August 30, 2007
By STEVE BROWN / The Dallas Morning News
Dallas is one of the few cities in the nation where home prices are still rising slightly, according to a national housing survey released Tuesday.
While U.S. home prices fell 3.2 percent in the second quarter, Standard & Poor's quarterly housing index reports that the Dallas metropolitan area was one of only five markets in the country with price gains.
Of the 20 cities it surveys, only Dallas , Seattle , Portland , Ore. , Atlanta and Charlotte , N.C. , had annual gains in home prices in the second quarter.
But it's hard to say whether the 1.6 percent gain in Dallas home prices is sustainable, industry experts say.
Dr. James Gaines of Texas A&M University 's Real Estate Center said "In a lot of places in Dallas , home prices are still going up by double digits.” In other neighborhoods, they are actually falling. But across the board, the gainers outweigh the losers," he said.
As mortgage lenders tighten loan requirements, a significant number of potential homebuyers have been locked out of the market. That could hurt the volume of sales in North Texas in the months ahead.
"It may take awhile to sort out" what's happening in the mortgage market, Dr. William Brueggeman, director of SMU's real estate department said. "There is going to be a little pain and suffering here, but nothing like we are seeing in other markets."
Fewer subprime woes
Dr. Gaines says that even with the soaring foreclosure rates, there have been fewer subprime mortgage problems here.
"The mortgage shakeout is affecting other parts of the country a lot more than it is Texas ," he said. "We didn't have anywhere near the level or magnitude" of subprime loans that other markets did.
But that doesn't mean that Dallas-Fort Worth homeowners aren't going to be hammered with a steady diet of bad news about the U.S. housing market. Those negative reports weigh on consumer psychology.


by Christie Cannon









Lakes of Prosper - Highland Homes

by Christie Cannon

Tucked away in the small, rural town of Prosper, this 39-acre, master-planned community offers homeowners a chance to get in touch with small town values where residents are justly proud of their "Exemplary" school district. Children will be able to walk to a nearby planned elementary school and an on-site sports park means you can enjoy your children's games and still cook dinner at home.

If acres of parks, hike and bike trails and a large lake do not offer enough natural surroundings for a development, then add a private butterfly garden!

In addition to the hike and bike trails and cultivated butterfly garden, Lakes of Prosper will also offer a large community pool, splash park and playground. An adjoining city park guarantees a peaceful setting where the city isn't breathing down on you. Highland Homes will feature a wide range of designs created exclusively for Lakes of Prosper and because of its affordable unit price range of the $190s to $310s, its perfect for all types of homebuyers - from families to empty nesters. Homes in the community range in size from 1,718 square feet to 3,600 square feet on oversized homesites.

Best of all, the community will enjoy direct access to the Dallas North Tollway extension, giving residents a fast commute to Dallas. Less time on the road means more time at home - at Lakes of Prosper!

If the slower pace of small town living, affordable quality homes, and incredible amenities, paired with an easy commute and convenient shopping is what you've been looking for, come visit Lakes of Prosper today.  Call Chrisitie Cannon today for your personal tour of this subdivision at (469) 951-9588.

1031 Exchange Remaining Open Into 2007

by Christie Cannon

An exchanger opening a 1031 exchange in 2006 and which remains open into 2007 may still receive a limited tax deferral despite the partial or complete failure of the exchange. The tax on the gain from the 2006 sale will not be considered received by the exchanger until 2007 (rather than 2006) with the resulting tax payable in 2007 (rather than 2006).

The exchanger could receive the cash from the Qualified Intermediary as the result of the failure to identify replacement property within the 45-day identification period. The cash could also be received at the end of the 180-day exchange period because of the inability or failure to use all exchange funds to acquire replacement property.

The interaction of IRC sections 453 and 1031 provides this benefit to the exchanger. Section 453 concerns the tax treatment of installment sales. It provides that a seller receiving a note as part of the purchase price is not taxed upon the note when it is received. Rather, the seller owes tax as the principal payments are received. If, for example, the note is payable over three years, the taxpayer owes tax on one-third of the payments on the note at the end of each of the three years. This installment sale treatment is applicable to an exchanger who receives funds from a partial or failed exchange allowing deferral of tax for one year.

The installment sale treatment is available to the exchanger only if the exchanger "has a bona fide intent to enter into a deferred exchange at the beginning of the exchange period. A taxpayer will be treated as having a bona fide intent only if it is reasonable to believe, based on all the facts and circumstances as of the beginning of the exchange period that like-kind replacement property will be acquired before the end of the exchange period." Reg 1.1031(j) (2) (iv) IRS regulations provide the following example. In November, 2003, a corporation decides to expand by exchanging unsuitable property for property suitable for the expansion. On November 28, 2003 the unsuitable property is sold and the proceeds placed with a Qualified Intermediary. In early January 2004 the corporation's directors meet and decide that it is not feasible to proceed with the expansion due to a downturn in business reflected in the corporation's financial statements for the last quarter 2003.

The QI delivers the cash proceeds from the 2003 sale to the corporation on January 12, 2004 at the end of the identification period. All corporate actions are properly recorded in the minutes of the directors' meetings. The corporation had a bona fide intent to exchange and the gain on the property sold in 2003 may be recognized in 2004 [meaning tax on the gain is payable in 2005].

Another example from the IRS regulations involves an exchanger, who opens an exchange with $100,000 in September, 2003. On March 11, 2004 the exchanger acquires replacement property having a fair market value of $80,000. The $20,000 balance is released to the exchanger by the Qualified Intermediary at the same time. The exchanger may report the $20,000 gain in 2004 and pay the tax due in 2005. Again, the exchanger had a bona fide intent to complete the exchange. It is important to note that IRS regulations do not specifically address the issue of debt relief in this context. Debt relief is taxable boot.

Source: Property Line 1/9/07

Active Adult Community-Fairview

by Christie Cannon

Heritage Ranch offers an active adult livestyle for ages 55 and up.  This stunning community features a 24-hour guarded gate entrance, lakes, creeks lined with mature trees and plenty of amenities to keep you busy.  

There is the Heritage Ranch Golf Club, designed by Arthur Hills, which is an 18-hole championship golf course that offers a full-service golf shop, club rentals, locker rooms with showers, driving range and putting green. 

You will also find resturants, shopping and a 24,000 square foot Country Club with an outdoor swimming pool, indoor pool and heated spa, 4 tennis courts, restaurant and lounge, business center, library, billiards, fitness center, arts and crafts room, performing arts theater and banquet facilities.

The housing in Heritage Ranch consists of single family detached homes and duplexes.  Sizes range from 1,500 - 3,400 square feet and from $175,000 - $500,000+.

As a buyer, it does not cost you anything to be represented by a real estate agent, and it will be in your best interest to have someone looking out for you - EVEN IF YOU ARE BUYING NEW.  As a reader of my blog, feel free to ask me about my homebuyers rebate offer, and reduced fee if you plan to buy and sell through me!  For more information on this community or any other, please give me at call at 469-951-9588. 

La Cima in Stonebridge Ranch McKinney

by Christie Cannon

Highland Homes builders in La Cima / Stonebridge Ranch is offering HUGE buyer incentives right now.  Homes range from $400,000-$500,000.  When buying a Highland Home be sure to call me - I would love to rebate you some money back to help you out with closing costs or even some new furniture for your new home!  Give me a call direcely at (469) 951-9588 or email me anytime at

Displaying blog entries 361-368 of 368




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Christie Cannon
Keller Williams Realty
4783 Preston Road #300
Frisco TX 75034
Fax: 214-853-4774
Keller Williams Frisco - The Christie Cannon Team -


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