Even before the House and the Senate started hashing out this new stimulus package now signed into law, our office was receiving numerous calls from first-time buyers. They've been watching the market prices go down and they're looking to buy. We've done a lot of extra marketing to bring those calls in, but we're going a step farther by getting a mailing address from them and sending out a hardbound first-time home buyers book. This is getting a great deal of response and commitment from these buyers. The books cost about $10 each and shipping is $5, but the pay off has been worth it!
What's everyone else doing to grab those first-time buyers? Also, what do you think the new stimulus package is actually going to do to stimulate those potential clients out there? We've been sharing the following info with our clients: (Interpretation from Justin O'Donell, First Heritage Mortgage)
1. Eight grand, new buyers: The tax credit included in the economic stimulus legislation is much narrower than the one-time $15,000 proposal. This credit is equivalent to 10 percent of the purchase price of the home--although it's capped at $8,000--and applies only to first-time home buyers and principal residences. But unlike an earlier $7,500 home buyer tax credit, this one does not have to be repaid.
2. First time buyers defined: For the purpose of this legislation, a "first-time home buyer" is someone who hasn't owned a principal residence for three years before buying a house. (The date of purchase is considered the day that the title is transferred.) That means if you've owned a vacation home--but not a principal residence--within the past three years, you would still qualify for the credit.
3. 2009 buyers only: Only those who purchase a home on or after January 1 and before December 1, 2009 are eligible for the credit. Anyone who bought a home last year won't be able to take advantage of it.
4. Income limits: The tax credit is subject to income limitations. Single buyers need a modified adjusted gross income of $75,000 or less to qualify for the full credit, that's $150,000 for married couples. Those earning more than these thresholds may be eligible for reduced credits.
5. Refundable: Because the tax credit is "refundable," qualified buyers can take advantage of it even if they don't have much tax liability.
6. Recapture: Buyers have to own the home for at least three years in order to capitalize on the credit. If they sell the home before then, they will have to return the credit to the government. (Exceptions will be made in certain cases, such as death or divorce.)
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