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.
