Federal Tax Credit - Buy Now!

It’s a great time to buy real estate with the low interest rates and Federal Tax Credits that are available for 1st time buyers.  If you can find what you are looking for, now is a great time to make an offer.   Call your lender and get pre-qualified , then call us to help you find the right property and take take advantage of the Federal Tax Credits. 

Here’s an over view of the Tax Credit:

Q. President Obama has signed into law legislation extending the $8,000 first-time home buyer tax credit and creating a new, $6,500 credit for longtime homeowners who buy a new home. How does the extension of the first-time buyer credit work?

 
A. The old credit was scheduled to expire Nov. 30, so folks who hadn’t already signed a contract faced a daunting task to get a deal closed by the deadline.

Some real estate agents were writing provisions into contracts, making the purchase contingent on closing in time for the buyer to get the credit. Failing to do so would kill the sale.

Under the new law, the credit is available to qualifying buyers who sign a binding contract by April 30, 2010, and who close by June 30, 2010. The 60-day period should offer plenty of time for last-minute buyers to get to the closing table.

There are a few differences that apply to deals closed after Nov. 6, the day President Obama signed the bill into law.

First though, the similarities:

The first-time buyer credit isn’t really restricted to first-timers. You’re considered a first-time buyer if you have not owned a home for at least three years prior to the date you settle on your new home.

The credit is available only for the home you live in. It’s not available for rental properties or vacation homes.

The credit is 10 percent of the purchase price of the home, up to a maximum credit of $8,000. Therefore, if the house costs $80,000 or more, you can qualify for the maximum tax credit.

Unlike the first-time buyer credit that was available in 2008, this credit does not have to be repaid… as long as you live in the house for at least three years. Sell or move out before three years, however, and you have to pay back the $8,000 as extra tax on your tax return for the year you sell or move. The payback can’t exceed the amount of profit you make on the sale, though.

Want more info?  Visit the Federal Tax Credit website to learn more.