HR 3221, Housing and Economic Recovery Act

We have received numerous questions about the Housing and Economic Recovery Act and what it means for New Hampshire. A quick summary of the bill follows:

• $11 billion Mortgage Revenue Bond (MRB) allocation, to help meet the increased demand for long-term, fixed rate mortgage finance and refinance loans for low and moderate income home buyers.
  New Hampshire’s Share: $96.5 million
  
  The Act allows these additional MRB funds to be used toward the financing of single family mortgages, multi-family rental units and the refinancing of certain types of single family mortage loans.
  
• 20-cent per capita Low Income Housing Tax Credit cap increase to support the creation and rehabilitation of affordable rental housing, which is becoming more expensive given escalating construction, land, and energy costs; as well as funding gap challenges resulting from changes in the tax credit marketplace.
  New Hampshire’s Share: $526,000 additional tax-credit cap between 2008 and 2009
  
• $3.92 billion in grants to assist the state and local governments in stabilizing neighborhoods negatively impacted by foreclosure. Funds must be used within 18 months of receipt.
  New Hampshire’s Share: $19.6 million
  
  The New Hampshire Community Development Finance Authority administers these stabilization funds.
  
• Housing Trust Fund to increase and preserve the supply of rental housing for extremely low and very low-income families, including homeless families; and to increase homeownership for extremely low and very low-income families.
  
• Changes FHA programs to allow more single family borrowers access to safe and secure mortgages - permits FHA to insure certain credit worthy refinances. New Hampshire Housing is working closely with FHA to understand the requirements and timing of this insurance program. Please check this site for updates.
  
• Creates a $7,500 tax credit for first-time home buyers. This tax credit applies to home purchases after April 8, 2008, and before July 1, 2009 (and is superceded by a new $8,000 non-repayable tax credit for homes purchased after 12/31/08 and before 12/1/09). Please check with your tax advisor for details on the credit.