1ST TIME HOME BUYERS AND EXISTING HOME OWNERS TAKE NOTE, THIS MAY WELL BE THE BEST TIME IN YOUR LIFE TO PURCHASE A HOME!!!Why is this the perfect scenario to be home buyer?
A) Inventory is near all time highs meaning you have more homes to choose from in your price range. Better chance of finding the best home for YOU!
B) Due to the high inventory, the basic laws of supply and demand have brought home prices down to multi-year lows. You can now get more home for your money!
C) Interest rates are near all time historic lows. This means you could qualify for a higher loan amount without increasing your monthly payments compared to when interest rates were higher.
D) Our Federal Government recently passed a stimulus plan which contained up to an $8,000 "REFUNDABLE" TAX CREDIT to first time home buyers and up to $6,500 for existing home owners who purchase a home between Jan. 1, 2009 through April 30, 2010 (you will have until July 1, 2010 to close the transaction). This is not a deduction off of your taxable income, it is a true tax credit which would reduce your tax liability up to $8,000 / $6,500 or refund you up to an additional $8,000 / $6,500.
Here are some of the details of the newly revised Home Buyer Tax Credit:
1) The credit is equal to 10% of the purchase price of a first time home buyers principal residence up to a maximum of $8,000 or for existing homeowners up to a maximum of $6,500. Unlike the earlier (2008) $7500 Tax Credit, this tax credit DOES NOT have to be repaid.
2) For the purposes of this tax credit, a first time home buyer is defined as someone who hasn't owned a PRINCIPAL residence in the past three years. If you owned a vacation home but not a principal residence, you would still qualify for the credit.
A current homeowner is defined as having used the home sold or being sold as a primary residence for five consective years during the past eight years.
3) This tax credit is only good for home buyers who purchase between Jan. 1, 2009 and April 30, 2010. Anyone who purchased prior to 2009 will not be able to take advantage of this tax credit but may be entitled to other credits.
4) Income limits have been increase to $125,000 modified adjusted gross income for a single buyer or $225,000 for a married couple apply to receive the full credit. Those earning more than these amounts may still be eligible for reduced credits.
5) Because the tax credit is refundable, qualified buyers can take advantage of it even if they don't have a tax liability.
6) Buyers must own the home for at least 3 years in order to capitalize on the credit. If the home sells in less than 3 years, they will have to return the credit to the government. (Exceptions may be made in cases such as death or divorce.)
People often ask...What is the difference between the “haves” and the “have nots”. Quite simply, in many cases it is the ability to act when most others won’t. For example, purchasing stocks when they are cheap because most people are selling and then selling them at high prices while most others are buying into the euphoria.
Great selection, low prices, low interest rates and now the federal government is offering you up to $8,000 for your personal bail out!
If you don't act now, when will you act?
Contact us to discuss any questions you have about the home buyer tax credit, purchasing real estate, or how we may be of assistance to you.
Information gathered from various sources including U.S. News & World Report, First-Time Home Buyer Tax Credit: 6 Things to Know by Luke Mullins and the NAR.
