We are living in unprecedented times.  Not since World War II when our government enacted a special loan program for the returning soldiers through the Veteran’s Administration have we seen such a sweet plum for first time home buyers.  Last year, the Housing Recovery Act of 2007 offered first time home buyers a $7500 tax credit if they bought a home after April 8, 2008 and before January 1, 2009.  However, the credit was not a true credit; it was an interest free loan.  If you claimed the credit, you needed to repay it $500 a year over 15 years.

This year, in the Housing Recovery Act of 2008, Congress sweetened the pot.  The tax credit was increased to $8000 and the repayment provision was dropped.  Yes, that’s right.  If you are a first-time homebuyer and you buy a home after January 1, 2009 but before December 1, 2009, you can claim the tax credit of $8000 or 10% of the purchase price of the home, whichever is less.

I had a student attending our seminar for First-Time Homebuyers ask if I thought this provision would be extended yet one more year. It depends.  The provision was an attempt to put a stop to the rapid drop in home prices and create a new “floor” for the housing market.  In our area, the tax credit has accelerated home purchases.  Home sellers, however, are still hesitant to list their home for sale because of the huge price drops of the last three years.  So slowly, houses are being taken off the market and inventory is dropping.  If there is not a glut of low cost housing on the market in November, my guess is the tax provision will not be extended.

However, there it is, right now.  TAKE ADVANTAGE OF IT.  Never before have low prices, low mortgage rates and a great tax credit come together to make this the best time to buy a first home in the last 50 years.

For more detailed information, come to our FREE NO OBLIGATION FIRST TIME HOMEBUYER class or wait for future blogs.  “Simple answers to home ownership questions”.

The mind boggles!!  $8000 in free cash, very few strings attached, from my favorite uncle, Uncle Sam.  I’m sure you’ve already spent this money in your mind but here area a few more suggestions related to home ownership.

Let’s say you are short of cash for the down payment but you have a blood relative who would “gift” you the money if you promised to repay them some time in the future.  If you were buying a home on an FHA mortgage, you would need 3.5% of the purchase price in down payment money.  For $8000, you could buy up to a $230,000 home (assuming you qualified for that much monthly payment) and take a loan from uncle/aunt/grandma/mom.  You could then collect your $8000 tax credit from Uncle Sam and pay them back this year.    If you’ve read some of our other blogs, you know that the closing costs can be paid by the seller.  You could get into that lovely home for FREE.

Or let’s say you are interested in a home but it needs some redecorating such as new carpet or flooring throughout ($4000), new paint in all the rooms ($300) and some new appliances in the kitchen ($3000).  None of these fixes would make it hard for you to get mortgage approval but they might make it hard for you to LOVE your home.  Buy the home, claim your $8000 tax credit and use the cash to create a home you LOVE.  Put in the carpet, repaint the rooms in custom colors and buy those stainless steel kitchen appliances.  Then sit back and enjoy.

Or let’s say the home is pretty darn nice but the yard isn’t.  It’s been neglected, never had any landscaping or fencing for the kids and the dog, and the deck needs to be removed and rebuilt.  Let’s plan a new deck ($5000) and let’s get some landscapers out there to put in the perennials, replace sod and add a tree or shrub or two ($3000).  From ugly to lovely.  There’s lots more ideas too but these should get you thinking of the POSSIBILITIES for that lovely $8000 First-Time Homebuyer Tax Credit.

For more detailed information, come to our FREE NO OBLIGATION FIRST TIME HOMEBUYER class or wait for future blogs.  “Simple answers to home ownership questions”.

We are living in unprecedented times.  Not since World War II when our government enacted a special loan program for the returning soldiers through the Veteran’s Administration have we seen such a sweet plum for first time home buyers.  Last year, the Housing Recovery Act of 2007 offered first time home buyers a $7500 tax credit if they bought a home after April 8, 2008 and before January 1, 2009.  However, the credit was not a true credit; it was an interest free loan.  If you claimed the credit, you needed to repay it $500 a year over 15 years.

This year, in the Housing Recovery Act of 2008, Congress sweetened the pot.  The tax credit was increased to $8000 and the repayment provision was dropped.  Yes, that’s right.  If you are a first-time homebuyer and you buy a home after January 1, 2009 but before December 1, 2009, you can claim the tax credit of $8000 or 10% of the purchase price of the home, whichever is less.

I had a student attending our seminar for First-Time Homebuyers ask if I thought this provision would be extended yet one more year. It depends.  The provision was an attempt to put a stop to the rapid drop in home prices and create a new “floor” for the housing market.  In our area, the tax credit has accelerated home purchases.  Home sellers, however, are still hesitant to list their home for sale because of the huge price drops of the last three years.  So slowly, houses are being taken off the market and inventory is dropping.  If there is not a glut of low cost housing on the market in November, my guess is the tax provision will not be extended.

However, there it is, right now.  TAKE ADVANTAGE OF IT.  Never before have low prices, low mortgage rates and a great tax credit come together to make this the best time to buy a first home in the last 50 years.

For more detailed information, come to our FREE NO OBLIGATION FIRST TIME HOMEBUYER class or wait for future blogs.  “Simple answers to home ownership questions”.

The mind boggles!!  $8000 in free cash, very few strings attached, from my favorite uncle, Uncle Sam.  I’m sure you’ve already spent this money in your mind but here area a few more suggestions related to home ownership.

Let’s say you are short of cash for the down payment but you have a blood relative who would “gift” you the money if you promised to repay them some time in the future.  If you were buying a home on an FHA mortgage, you would need 3.5% of the purchase price in down payment money.  For $8000, you could buy up to a $230,000 home (assuming you qualified for that much monthly payment) and take a loan from uncle/aunt/grandma/mom.  You could then collect your $8000 tax credit from Uncle Sam and pay them back this year.    If you’ve read some of our other blogs, you know that the closing costs can be paid by the seller.  You could get into that lovely home for FREE.

Or let’s say you are interested in a home but it needs some redecorating such as new carpet or flooring throughout ($4000), new paint in all the rooms ($300) and some new appliances in the kitchen ($3000).  None of these fixes would make it hard for you to get mortgage approval but they might make it hard for you to LOVE your home.  Buy the home, claim your $8000 tax credit and use the cash to create a home you LOVE.  Put in the carpet, repaint the rooms in custom colors and buy those stainless steel kitchen appliances.  Then sit back and enjoy.

Or let’s say the home is pretty darn nice but the yard isn’t.  It’s been neglected, never had any landscaping or fencing for the kids and the dog, and the deck needs to be removed and rebuilt.  Let’s plan a new deck ($5000) and let’s get some landscapers out there to put in the perennials, replace sod and add a tree or shrub or two ($3000).  From ugly to lovely.  There’s lots more ideas too but these should get you thinking of the POSSIBILITIES for that lovely $8000 First-Time Homebuyer Tax Credit.

For more detailed information, come to our FREE NO OBLIGATION FIRST TIME HOMEBUYER class or wait for future blogs.  “Simple answers to home ownership questions”.