Good news for the first time home buyers is that they can avail of the Federal Tax credit and the market is active and alive because of the Housing and Economic Recovery Act of 2008, and of course, it is no surprise that the market is reverberating. With the market conditions convenient to the buyer and with the first time homebuyer tax credit for the buyers, it goes without saying that the time is ripe now for the buyers to plunge into the home buying spree.
Different people have different ideas as to what this new tax credit is and it is the time that we take a look at the details of what this first-time homebuyer tax credit is all about and how it benefits the customer.
Now, for this sake let us first look into the definition of what a first time home buyer is. A first time home buyer is one who has not owned any home in the past three years. If you are a citizen of the United States and a tax payer and if you conform to the interpretation of the first time home buyer then you can consider yourselves as having the eligibility to participate in the program.
To be eligible to participate in the program, any single individual must have an income which is less than $75000, and for married couples who file a joint income tax return, the income border is 1500000.
People who make income somewhere between $75000 and $95000 and who are taxpayers that are either single or head of household are eligible for a partial first time home buyer tax credit. Couples who are married and who make between $150000 and $170000 are qualified for a partial first time home buyer tax credit.
Homes that are suitable for single family, townhomes and tenant-owned apartment houses, these homes qualify for the tax credit in an assumption that the home will be used as the primary abode and that the purchaser had not owned a home in the past three years.
This credit is fundamentally an interest-free loan which will be reimbursed over 15 years. Supposing that you get the whole $7500 as credit, then you will have to pay it back at $500 per year for 15 years, and a breather here is that the buyer starts paying the credit only two years after the year in which he had claimed the credit. Is this not a thoughtful and cordial feature?!
Now let us assume that you want to sell the home short of 15 years before the credit is settled off. In that case, the balance amount will be due from the profit of the disposal of the home. If you do not make money enough as profit on the sale, then the balance of the credit reimbursement proceeds would be excused.
So, after hearing all this, don’t you think it is time to take an enthusiastic leap? You better get t o know that even while the market is down, home prices will still get high on, in fact, more than the stock market!
Go ahead with your dreams!