Top Foreclosure States In July 2008
(source: www.RealtyTrac.com)

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Here are 5 new reasons to move this year:

1. The federal government is offering a tax credit for first time homebuyers of 10% of the price of the home, up to a maximum credit of $7,500. There are income and other restrictions, so you should consult a tax professional to see if you could benefit.

2. Recently Federal Reserve Chairman Bernanke said “Fed Funds rate increases may be coming in the near future … these actions will most definitely also increase the cost of obtaining financing,” indicating a possible rise in interest rates next year. Historically changes to the Fed’s Funds Rate tend to impact mortgage rates.

3. The loan limit for FHA loans has increased in many areas, allowing buyers of higher priced homes to use these low downpayment programs for the fist time. FHA downpayment requirements go up next year.

4. Certain types of downpayment assistance programs, such as some offered by homebuilders, will not be available after this year.

5. Many sellers are more willing to negotiate if their homes have been sitting on the market for awhile.

The current market still offers Buyers the greatest opportunity to buy at the years most favorable prices. There are still many attractive foreclosures to see, but those that are well priced continue to receive multiple offer and sell above the listing price. The foreclosure market continues to be an excellent opportunity for first time Buyers to purchase. In particular, the $7500 tax credit for first time Buyers recently passed by Congress makes right now the best time for new Buyers to purchase while there is available properties at rock bottom prices.

The foreclosures are coming fast and furious even celebrities are taking the hits. Below is a shortlist of celebrities affected by the housing woes.

Ed McMahon

The 85-year-old television personality owes $644,000 to Countrywide on his six-bedroom, five-bathroom Beverly Hills estate - in the same exclusive, gated community where Britney Spears lives. The property has been on the market for 2 years and now could be facing foreclosure.

Laura Richardson

The California congresswoman evidently bet big on the real estate boom and lost. She’s had her three houses in Long Beach, San Pedro and Sacramento in foreclosure proceedings in recent months.

Jose Canseco
The former baseball MVP forfeited his $2.5M home in Encino after racking up millions of debt.

Latrell Sprewell
The former All-Star NBA guard lost his 70-foot yacht, named the “Milmwaukee’s Best” after he stopped making the $10,322 monthly payment. Sprewell also lost his $610,000 Milwaukee home through foreclosure.

Michael Jackson
After failing to repay his $21M mortgage on the Neverland Ranch in Santa Barbara County, his attorneys worked out a deal with Fortress Investment Group to buy out the loan and avoid foreclosure

Evander Holyfield
The Boxing champ defaulted defaulted on a $10 million loan to Washington Mutual on his 109-room estate in Fayette County, Ga. The home was set to be auctioned off in July.

Latrell Sprewell
The former All-Star NBA guard lost his 70-foot yacht, named the “Milmwaukee’s Best” after he stopped making the $10,322 monthly payment. Sprewell also lost his $610,000 Milwaukee home through foreclosure.

Whitney Houston
Whitney Houston’s house went deep into foreclosure proceedings, then she sold her five-bedroom, 8,022-square-foot house in Alpharetta, Ga. for $1,190,000.

Aretha Franklin
The queen of soul lost her brick mansion and $2M condo in Michigan to tax collectors.

Laura Richardson
The California congresswoman evidently bet big on the real estate boom and lost. She’s had her three houses in Long Beach, San Pedro and Sacramento in foreclosure proceedings in recent months.

Vin Baker
Former NBA star saw his home in Durham, CT auctioned off. The seven-bed, six-and-a-half-bath mansion, on about 11 acres with a basketball court and a bowling alley, had been on the market for $2,950,000

Courtney Love
The singer/actress’ historic Washington house was up for auction when the bank foreclosed the property, apparently owing $367,000.

Avril Lavigne
Rock star Lavigne avoided foreclosure when she listed her nearly 6,900-square-foot Mulholland Estates mansion for $5.8 million and eventually accepted a cash offer of $5.2 million.

Adam “Pacman” Jones
The NFL star purchased the mansion sitting on 30 acre lot for $1.5M in July 2006, located in a Nashville suburb. Jones had defaulted on a mortgage with U.S. Bank, and now the sale is set for noon on Aug. 22.

By DAVE CARPENTER, AP Business Writer Tue Jul 29, 11:02 PM ET

Questions and answers about the Hope for Homeowners Act of 2008, passed by Congress last weekend to try to steer as many as 400,000 struggling homeowners away from foreclosure:

Q: What exactly will the legislation do?

A: It will allow those who qualify to cancel their old mortgage loans and replace them with 30-year fixed-rate loans for up to 90 percent of the home’s current value. The FHA will insure a total of $300 billion of the loans over a three-year period.

But the decision on whether to write such a loan remains up to banks, which would have to be willing to take a loss on the existing loans in exchange for avoiding an often-costly foreclosure.

Q: Who is eligible?
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