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$7500 Tax credit

First time homebuyers still have the $7500 tax credit available in 2009, when they file their income taxes if they close before December 31. This credit is interest free and paid back over 15 years. If your client usually gets back $500 they would get back $8000.

There are other specifics that I would be glad to explain, but I think we should focus on getting the word out to the public quickly. If you've never owned a home before and are pretty certain you will buy, buy now and reap the harvest! What do you think?

Posted by Valerie Springer, Home Loan Officer AL FHA, VA, Conventional and Reverse Mortga on 11/18/2008 10:07 PM

Comments (11)

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11 Comments on $7500 Tax credit

NOV

2008

Pretty nice deal.

But, it has not sparked the new homebuyers in my market.

How about yours?

Well, if it is a credit -- why does it have to be paid back? It seems it is a loan or an advance -- how and when does it have to be repaid?

How long do they have to keep the home? If not long enough, do they have to pay it back at the sale of the home.

This credit must be repaid at 6.67% per year starting in 2010.

I don't know how they get away with calling it a credit. It is actually more of a 0% loan, which isn't a bad thing, but not really a credit.

NOV

2008

Thanks for the reminder Val! I need to see who I know that might be interested in this. Do you have some sort of an overview of details that you could email to me? Looks like you have lots of questions to answer above :)

Deb

Linda: They are not knocking our doors down, but many people do not know about it. I have several first time home owners that are looking for a home to get the credit. Just trying to get the word out. Any movement in the market right now is a positive.Thank you for responding.

Joan: The government is once again trying to get some money flowing. Now that 100% financing is gone this helps the first time homebuyer have some money to set up housekeeping or really whatever they would like to do with it. Certain circumstances allow the balance to be forgiven so it may not have to be paid back. See comment to Sandy. Thank you.

SANDY: Good question. The information I was given doesn't say there is a time limit on how long someone has to keep the house. One scenario that was given me: The purchaser sales the home after 2 years, they walk away from the table with $1k, the $1k would go toward the repayment, plus the $500 dollars they paid in 2010 which would leave a balance of $6k and would be forgiven. The seller would not make any money on the house but they would not have to pay back $6k of the amount they were credited. Thanks.

David: My overview says it is interest free. Where did you get the 6.67% interest rate? I have requested more information in case I missed an update. Thanks for the reply I look forward to hearing back from you.

Jim: I am not sure why they call it a credit except for the clause of forgiveness which means it may be forgiven. I myself wonder why someone wouldn't purchase a house, live in it two years, have the balance forgiven and more on to the next house? I don't know if this is part of the plan to have real estate moving or if was not well thought. Thank you for reply.

Deb: I do have an overview I will email to you. Thanks for the comment.

Thanks for the reminder. I have heard of this but nobody has asked me about it. I need to explain it to more people because it's called a first-time home buyer credit but as long as you haven't owned a home in the past 36 months (I think this is hte correct time) then you are also eligible for it.

Jenn: Right, if a buyer hasn't owned a home in the last 3 years they qualify. Thanks for the reply, I enjoy reading your blogs as well.

NOV

2008

6.67 is not an interest rate, it is the percentage of the original amount that must be repaid every year. 6.67 X 15 yrs = 100% of the loan.

JIM: Never figured the percentage but the payment is $500 per year.

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Valerie Springer, Home Loan Officer AL FHA, VA, Conventional and Reverse Mortga

Birmingham, AL

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Network Funding Residential Mortgage NMLS 2297

Address: 248 Inverness Center Drive, Birmingham, AL, 35242

Office Phone: (205) 995-7283 x 305

Cell Phone: (205) 746-1284

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