General Rules for Orlando Home Buyer Tax Credit Seekers:
A "first time home buyer" is defined as someone who has not owned a home in the last three years. If you are a "first-time home buyer", your tax credit will amount to 10% of the purchase price of your new home not to exceed $8,000.
A "long-time resident" is defined as someone who has lived in the same primary home for 5 out of the past 8 years. If you are a "long-time resident", your tax credit will amount to 10% of the purchase price of your new home not to exceed $6,500.
The tax credit does not need to be paid back if you continue living in the home as your primary residence for three years without selling it
The home must be purchased for less than $800,000 before May 1, 2010. If you sign a binding contract to purchase a home before May 1st, you would need to close on the transaction before July 1, 2010.
Single taxpayers with incomes up to $125,000 and married couples with incomes up to $225,000 qualify for the full tax credit
You cannot purchase the home from a related party like a spouse, direct ancestor, or direct lineal descendent (child or grandchild); however, you can still qualify for the credit if you purchase a property from siblings, nephews, nieces, and others
If you are married, both spouses must qualify for the credit
If more than one unmarried individual is buying the property, the credit can be split up among all the individuals who qualify. However, the total credit taken cannot exceed $8,000 (or $6,500 for "long-time residents"). Alternatively, if only one of the unmarried buyers qualifies for the credit based on their income or past home ownership status, the individual who qualifies for the credit can claim the full credit.
The credit applies even if you have co-signers on your mortgage loan
The credit applies to 1-4 unit homes as long as you live in one of the units as your primary residence - you could live in one unit and rent out the others
How does the tax credit work? A tax credit is kind of like a gift certificate that you can use to pay your taxes - it reduces your income tax bill on a dollar for dollar basis. Imagine paying your bill at IRS Restaurant, and then later getting an IRS Restaurant gift certificate. Normally, you would need to go back to IRS Restaurant and buy more food in order to use your new gift certificate. But what if IRS Restaurant allowed you to just turn in your gift certificate for cash? That's how the home buyer tax credit works! All you need to do is file a form with the IRS after you buy your new home and they will send you a refund check for $8,000 (or $6,500) - just like the example of IRS Restaurant that allows you to exchange your gift certificate for cash! Remember though, you'll receive the $8,000 (or $6,500) from the IRS AFTER you purchase your new home, so you cannot use the funds to help with your down payment.
Chris is Florida's #1 FHA Mortgage Broker and a syndicated mortgage blogger. He is regular contributor to the many leading industry blog-fronts including The Mortgage Chili Blog, My FHA Mortgage Blog, Top of Mind Networks, the newest contributor to Lenderama and has been recently featured on Fox35 News.
Combined, the 3 events reinforced the growing belief on Wall Street that the U.S. economy is in recovery, but not yet out of the woods. This particular philosophy has been excellent for mortgage rates, helping to hold conforming 30-year fixed mortgage rates near 5.250 percent since the start of the year.
It helped rates last week, too. But low rates......
Congress both extended and expanded the First-Time Home Buyer Tax Credit program Thursday.
The White House says the President will sign it into law today.
The up-to-$8000 tax credit's expiration date has been pushed forward to spring, requiring homebuyers to be under contract by April 30, 2010, and to be closed by June 30, 2010.
The program's basic eligibility requirements remain the same:
Buyers can't purchase the home from a parent, spouse, or child
Buyers can't purchase the home from an entity in which they're a majority owner
Buyers can't acquire the home by gift or inheritance
All parties to the purchase must meet eligibility requirements
The new law includes some notable updates, however.
For one, the definition of "first-time home buyer" has been expanded to include most homeowners with at least 5 years in their current home. "Move-up" buyers like these are now eligible for IRS tax credits, but with a cap at $6,500.
This means that you don't have to be a true first-time home buyer to claim the "first-time home buyer tax credit".
The Federal Open Market Committee voted to leave the Fed Funds Rate within its target range of 0.000-0.250 percent.
In its press release, the FOMC noted that the U.S. economy "has continued to pick up" since the September FOMC meeting and that housing market activity has increased.
It's the third consecutive post-FOMC statement in which the Fed speaks optimistically about the U.S. economy -- a signal that the recession is likely over.
The economy isn't without threats, however, and the Fed identified several in its announcement, including:
Ongoing job losses for American workers
Reduced fixed investment by businesses
Ongoing challenges for the financial markets
The overall tone remained positive, however,........
The Federal Open Market Committee caps off a scheduled, 2-day meeting today in the nation's capital, its 8th meeting of the year.
The group adjourns at 2:15 PM ET and, as is customary, will issue a press release reviewing its monetary policy and the health of the U.S. economy.
The FOMC's post-meeting statements are brief but comprehensive. They're a window into the mind of the Federal Reserve and Wall Street picks apart every sentence for clues.
It's why FOMC meetings tend to shake up the mortgage markets -- for good and for bad.
The Florida First-Time Home buyer Tax Credit may soon be known as the Home Buyer Tax Credit… being opened to non-first time buyers for the first time.
As you have likely already read on My FHA Mortgage Blog - the Florida First-Time Home Buyer tax credit is on the verge of extension. I noted there that there are a few exciting changes that benefit you - the home buyer! Here is an explanation as to their significance. Those noteworthy changes between the current tax credit and the proposed tax credit are:
Mortgage markets improved last week after a series of hugely volatile trading sessions.
Rates carved out a wide range on the week, culminating in a late-Friday plunge that dropped rates by about 1/8 percent.
It was the first time in 5 weeks that mortgage rates fell.
Volatility like that of last week is nothing new on Wall Street; it's been a running theme in 2009. Volatility occurs when markets don't agree on what's next for the economy and, this year, there's been a lot of disagreement like that.
Data has been inconsistent. Take last week for example.
At 9:00 AM Tuesday morning, the Case-Shiller Index showed home prices rising nationwide. Because many analysts believe housing fueled the recession, strength in the sector is widely construed a positive for the economy.
Mortgage rates rose on the news.
But then, an hour later, the national consumer confidence report revealed a substantial deterioration in sentiment versus the month prior. The data forced Wall Street to do an about-face.
Housing is important to the economy, but it can't affect growth like consumer spending can. When Americans are less confident about their future income, they tend to keep their wallets closed, retarding economic growth.
Holiday Shopping Season is getting underway and......
At some point in their lives, every home buyer in America has wondered "Is now the best time to buy a home?" In this 3-minute video, NBC's The Today Show does a good job of answering the question.
The conclusion? Yes, but not if you're going to overpay.
The Buyers Market is ending, we learn, as home prices rise across most of the country. Pockets of opportunity remain, however, and the focused home buyer can still find a "good deal".
Disclaimer: ActiveRain Corp. does not necessarily endorse the real estate agents, loan officers and brokers listed on this site. These real estate profiles, blogs and blog entries are provided here as a courtesy to our visitors to help them make an informed decision when buying or selling a house. ActiveRain Corp. takes no responsibility for the content in these profiles, that are written by the members of this community.
The Florida First-Time Home buyer Tax Credit may soon be known as the Home Buyer Tax Credit… being opened to non-first time buyers for the first time.
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