If you are in the market to buy your first home you may be able to take advantage of a new federal tax credit for first time homebuyers. Here are some facts about the tax credit:
- The tax credit is for first-time home buyers only, a first-time buyer is defined as someone who has not owned a home in the past three years .
- The tax credit does not have to be repaid. This is a change from last year’s tax credit which was basically an interest-free loan, repaid over 15 years.
- The tax credit is equal to 10 percent of the home’s purchase price up to a maximum of $8,000. So someone purchasing a $60,000 home would only receive a $6,000 credit, while someone purchasing a $300,000 home would only receive the $8,000 maximum.
- The credit is available for homes purchased on or after January 1, 2009 and before December 1, 2009.
- Single taxpayers with modified adjusted gross incomes up to $75,000 and married couples with incomes up to $150,000 qualify for the full tax credit. Those with incomes over that amount may still qualify for a partial tax credit.
As you can see this is a great incentive for those who are considering purchasing a home this year, but are unsure if now is the right time to take the path to homeownership. For more reasons why 2009 may be a great time to buy, please read:
Why 2009 is the Time to Buy - Part 2
Remember, before you even begin to look at houses you should contact a mortgage professional to get pre-approved for a loan, so that you will be sure you qualify and so you will know exactly how much home you can afford.
Please contact us with any questions or to get started today.
Tags: $8000 tax credit, first time home buyers, mortgages, preapprovals
