Buying A House Using The Home Buyer Tax Credit

Inspite of the new tax credit signed into law yesterday by President Obama, there is still some confusion and many people are now starting to ask questions as to who qualifies, etc.  Yesterday, in my post I submitted an easy to read chart with the particulars.  To emphasize some information in that chart, a purchase to qualify would have to be made after enactment i.e.  it was signed 11/6 by the President which means it is effective  – November 7, 2009:

Who is Eligible

• First-time home buyers, who are defined by the law as buyers who have not owned a principal residence during the three-year period prior to the purchase, may be eligible for up to an $8,000 tax credit. 
• Existing home owners who have been residing in their principal residence for five consecutive years out of the last eight and are purchasing a home to be their principal residence (“repeat buyer”), may be eligible for up to a $6,500 tax credit. 
• All U.S. citizens who file taxes are eligible to participate in the program. 

Income Limits

• Home buyers who file as single or head-of-household taxpayers can claim the full credit ($8,000 for first-time buyers and $6,500 for repeat buyers) if their modified adjusted gross income (MAGI) is less than $125,000.  
• For married couples filing a joint return, the combined income limit is $225,000. 
• Single or head-of-household taxpayers who earn between $125,000 and $145,000, and married couples who earn between $225,000 and $245,000 are eligible to receive a partial credit.  
• The credit is not available for single taxpayers whose MAGI is greater than $145,000 and married couples with a MAGI that exceeds $245,000. 

Effective Dates

• The eligibility period for the tax credit is for homes purchased after Nov. 6, 2009 i.e. effective November 7, and before May 1, 2010. However, home purchases subject to a binding sales contract signed by April 30, 2010, will qualify for the tax credit provided closing occurs prior to July 1, 2010.  If a written binding contract to purchase was in effect by April 30, 2010, the purchaser will have until July 1, 2010 to close

 Types of Homes that Qualify

• All homes with a purchase price of less than $800,000 qualify, including newly-constructed or resale, and single-family detached, townhomes or condominiums, provided that the home will be used as their principal residence. Vacation home and rental property purchases do NOT qualify.   

 Tax Credit is Refundable

• A refundable credit means that if the amount of income taxes you owe is less than the credit amount you qualify for, the government will send you a check for the difference. 
• For example:  
  • A first-time buyer who qualifies for the full $8,000 credit who owes $5,000 in federal income taxes would pay nothing to the IRS and receive a $3,000 payment from the government. If you are due to receive a $1,000 refund, you would receive $9,000 ($1,000 plus the $8,000 first-time home buyer tax credit).  
  • A repeat buyer who owes $5,000 would pay nothing to the IRS and receive $1,500 back from the government. If you are due to get a $1,000 refund, you would get $7,500 ($1,000 plus the $6,500 repeat buyer tax credit). 
• All qualified home buyers can take the tax credit on their 2009 or 2010 income tax return. 

Payback Provisions

• The tax credit is a true credit. It does not have to be repaid unless the home owner sells or stops using the home as their principal residence within three years after the purchase.

The www.federalhousingtaxcredit.com site is being updated. Please check the site next week for more detailed information on the new tax credit!  

ALL ABOUT…..Portland.Oregon.Real Estate, is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 Unported License. ©

Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws.  Based on a Blog at WordPress.

(For more local and national real estate information, go to www.bettyjung.com).
Portland

Home Buyer Tax Credit – Are You Pre-Approved?

Now Official – President Obama has signed tax credit into law. 10 a.m.

We are very close to getting final approval for extension of the tax credit.  The bill has passed both the Senate and the House of Representatives, and the President’s signature is expected today. 

The legislation includes the following components (here’s a link to a chart with more particulars of the tax credit):

• The $8,000 tax credit will be extended and available for first-time purchases before May 1, 2010. Prospective purchasers with binding contracts in place as of April 30, 2010, will be allowed an additional 60 days to complete the transaction. Income limits are expanded to $125,000 on a single return and $225,000 on a joint return.  
• A new $6,500 tax credit will be available for repeat buyers who purchase between December 1, 2009, and May 1, 2010. To qualify for this provision, buyers must have lived in their homes consecutively for 5 of the previous 8 years.

There are many that don’t accept the “Buy Now” propaganda.  However, prices are low, interest rates are historically low, there’s lots of inventory to choose from, and with the additional tax credit, how can one say now is not a good time to buy?  Very rarely in my 34 years, and I’ve written about this before, have I seen where everything falls into place perfectly.  Now is a time where it’s close to being perfect – low prices, low rates, lots of inventory, tax credits, etc.

If you have a job, have savings, have a down payment, what is stopping you from buying a home?  As indicated in previous posts, I’ve always owned and I don’t believe in paying off someone else’s mortgage by renting.  I believe it’s far better to build your own equity than someone else’s. Granted there are reasons and times you should rent instead of buy, however, for the most part, I believe in buying a home of your own (I know you’re thinking, but I’m the Realtor®).

Now is the time to get pre-approved for a loan if you are planning on utilizing the tax credit.  Time passed quickly during the first tax credit time period and you don’t want to waste precious time this go-around — get pre-approved now.

Let me help, I’d love to be your Realtor®!

ALL ABOUT…..Portland.Oregon.Real Estate, is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 Unported License. © Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws.  Based on a Blog at WordPress.

(For more local and national real estate information, go to www.bettyjung.com).

Portland

City Of Lake Oswego To Answer Housing Call

As you know if you’ve been reading my blog, I have been on my “platform” so to speak against large homes and about the need and desires of the boomers wanting to stay in their communities as they age.

After I published my critical post about the City, the Lake Oswego Review had a story about how its officials are rethinking the future development here in Lake Oswego and had this to say:

“Before the current recession, the trend in Lake Oswego was to replace older bungalows and ranch homes with large, expensive houses. In addition to Lake Oswego’s attractive parks, schools and other amenities, high land prices and easy access to credit contributed to the tear down trend locally. The small, relatively affordable homes that were removed for upscale housing were never replaced. What was once entry-level housing quickly disappeared, and middle-income families and young adults are now essentially shut out of the Lake Oswego market. This, of course, creates a problem for the Lake Oswego’s public schools, which are experiencing an overall decline in the local school age population; the school district is now seeking tuition-paying students from outside the district, which is not a sustainable solution. The trend is also a problem for empty nesters and other long-time residents who wish to stay in Lake Oswego.”

The First Addition neighborhood is one of the areas referred to in the above.  The small cottages were torn down in favor of the larger McMansions much to the disgust and anger of residents living there.  Now, that quaint and award-winning community is stuck with those larger homes crowding out the remaining smaller houses. 

I also read recently on the Heritage Council’s website that many of this town’s architectural landmarks have been torn down, lost or have disappeared.  Since I started my Lake Oswego Living.A Photo Blog, I’ve been researching landmarks and photos I want to take.  There’s a lot of history here in town that can never be captured.  It’s a shame that everything in favor of and to benefit its citizens is always done after the fact and not with forethought like saving those historic sites.  We’ve got to do more.  This is a great community and it can get even better.

You sometimes hear critics call this quaint town “Lake Ego”.  Frankly, I love living here and I for one don’t want to leave.

ALL ABOUT…..Portland.Oregon.Real Estate, is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 Unported License. © Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws.  Based on a Blog at WordPress.

(For more local and national real estate information, go to www.bettyjung.com).
Portland

Oregon Financing Update – Mortgage Market In Review

Guest Author:

Bob Chiodo, CFP

Equity Home Mortgage, LLC

bobchiodo@equityhome.com

 

 

ALL ABOUT…..Portland.Oregon.Real Estate, is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 Unported License. © Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws.  Based on a Blog at WordPress.

(For more local and national real estate information, go to www.bettyjung.com).
Portland

Further Along The Road

Recently, on another blog site I was told by a real estate agent I should “pack it up” and put my posting on vacation since real estate is slow, and come back again when things pick up.  I’d then be so busy, I wouldn’t have time to post.  Frankly that goes against everything I believe in. 

In May 2008 when things were slow then too, I got my blog on-line and focused on social media and internet advertising. Nordstrom’s retail sales are down drastically, yet Nordstrom is still sending out their catalogs and advertising.  They haven’t stopped. They aren’t waiting until their sales start improving.  I have taken their approach and only expanded my on-line presence, not eliminating it or slowing its pace, yet not being distracted from my main objective of listing and selling real estate in the metro Portland area. 

Last year another reader was also critical of my lack of presence on Twitter and Facebook and my ignorance regarding how important those sites are.  OK so now I’m part of the Twitter and Facebook family.  There was a great video recently that shows how important your on-line presence is not only if you are a Realtor®, but if you are another business owner as well.  You can see it here.  

So I’ve been busy focusing on my Internet presence:

• Photo Blog

Recently, I started my photo blog….Lake Oswego Living.A Photo Blog and a new photo was posted Sunday.  If I had it to do all over again, I would only do a photo blog.  I didn’t happen upon this idea until recently and it is a lot more fun than posting every day on ALL ABOUT…..Portland.Oregon.Real Estate.  I post a new photo every week, typically on Monday’s, devoted to Lake Oswego.

• My blog will soon have direct access to foreclosures. 

RE/MAX International, Inc., announced a strategic partnership with RealtyTrac. Through the partnership, RE/MAX Associates will receive discounted subscription rates to RealtyTrac, the nation’s leading online foreclosure marketplace.

• New blog features

If it’s been confusing navigating my blog lately, I have been rearranging categories/posts and have added new search categories.  In addition, I have started posting city profiles. Tigard, Lake Oswego, and West Linn are posted with West Portland to follow.  There will also be individual neighborhood snippets for those areas.  There are new links to mortgage calculators, FHA loan limits, rent vs. buy, credit reports, search investment properties, search for residential properties, videos, plus many more new links in the sidebar and some new ones to come. 

• My blog is now on multiple blogging sites

My daily blog (this blog)appears on RealTown, Trulia, Realtor.com, Blogger, Linkedin, short tweets on Facebook and Twitter and, of course here on my main site –  WordPress.  They all contain the same information.  From the beginning, I had committed to writing daily and since May 2008, I’ve been doing  just that.  I had started one more blogging platform, but have decided to stop my participation on ActiveRain.

• New website and blogging design

I’m upgrading my blog here at WordPress. Lots of new ideas and soon will incorporate some of them. Who said computers would make our lives easier??

• I continue to learn

A while ago, I attended a WordPress Camp (a techie conference).   I was unable to go both days, but after one session, I was already on overload.  Yesterday I listened to RealEstate Tomato on BlogTalkRadio.  Stefan Swanepoel spoke about the new trends in social networking.  He has for the last 20 years written TREND Report tracking real estate trends and now also writes about social media trends.  I continue to learn but seem to have a million other questions.  In addition, I hope to take some photography classes soon.

All this to better assist you in buying or selling real estate.  P.S. Let me help, I’d love to be your Realtor®!

ALL ABOUT…..Portland.Oregon.Real Estate, is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 Unported License. © Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws.  Based on a Blog at WordPress.

(For more local and national real estate information, go to www.bettyjung.com).
Portland