There has been a lot of talk about the 7,500 tax credit for first time home buyers.  The homebuyer's tax credit was intended to stimulate the housing industry.  Many felt it was more like a interest free loan because it had to be paid back over 15 years.  Well now this may be replaced by a $15,000 tax credit for buyers if the 2009 economic stimulus package ultimately passes. 

I believe this would help many buyers who are undecided, to move forward and purchase more homes, which in effect would help sellers as well.  This could change the current housing market.  Many Americans are upset about the "bank bail out" and jokingly ask where their bail out is.  This may be it for some people. 

I have to admit as great as this sounds for buyers, and sellers, I am concerned about where this money will come from, and who will end up paying the price some day.

What we have currently:  A $7,500 First-Time Home Buyers Tax Credit

A buyer has to meet the following requirements to claim the credit:

• Bought a main home in the U.S. after April 8, 2008 and before July 1, 2009
• Did not own any other main home within 3 years of this purchase
• Made less than $95,000 (for individuals) or $170,000 ( for married couples) in 2008

Currently, the taxpayer claims $7,500 on the tax return, but is required to pay back that amount over a 15-year period.

But now a $15,000 home buyers tax credit may replace the existing 15-year interest free $7,500 loan.

As part of the negotiations behind the American Recovery and Reinvestment Act of 2009, otherwise known as the 2009 economic stimulus package, a $15,000  tax credit has been slated to replace the original $7,500 tax break if the plan is ultimately passed. 

Senator Johnny Isakson, a Republican from Georgia, has pushed for both the $7,500 and $15,000 tax credits. He believes the homebuyer tax credit measure that revived the housing market in 1975 can work again today. You can read more here:  $15,000 Homebuyer Tax Credit

What we could have soon :  Right now they are saying the amount of this tax credit would be $15,000 or 10 percent of the purchase price, whichever is less, and may be good on the purchase of a home for up to one year when it is passed. They are also saying this would be for all home buyers, not just new home buyers. This tax credit would not have to be repaid.

Many home buyers are just starting to hear about this, and some are confused as to what the $15,000 homebuyer tax credit would entail.  Buyers who purchased last year are wondering if it is going to be retroactive.  Those who already claimed the $7500 are wondering what happens now.  We don't have the answers yet. 

First, we will have to wait to see if it passes.  Then we'll find out what the rules are, and who will be entitled to it.  It's too soon to know.   

My question to you is: Do you think this is a good idea?  Would it push you to want to purchase a home?  Do you think it will change the housing market?