“Government Bailout Program Helps First Time Homebuyers Buy Their First Home with No Money Down”

We’ve all heard about the first-time home buyers $8,000 tax credit, but not everyone is exactly sure just what it means.  As of May 11, 2009 there is a new way to buy a home without a down payment.  FHA will allow you to use the $8,000 income tax credit as your source of money for your down payment.  The credit can be used as either $8000, or 10% of the purchase price of the home...whichever is smaller.

The people who are acting now are picking up bargains all across the country.  In some instances, they are buying homes at substantial discounts by buying homes out of foreclosure. Even those who have filed for a Chapter 7 bankruptcy may qualify for this program, however they must be discharged for at least two years.

What is a first-time home buyer exactly?

The IRS defines a first-time homebuyer as:

"...a buyer who has not owned a principal residence during the three-year period prior to the purchase. For married taxpayers, the law tests homeownership history of both the home buyer and his/her spouse. For example, if you have not owned a home in the past three years but your spouse has owned a principal residence, neither you nor your spouse qualifies for the first-time home buyer tax credit."

There are a few additional eligibility requirements to receive the tax credit:

• You must be an owner-occupant.
• It must be your principal residence.
• You must close on your home before December 1, 2009.
• You must purchase from an unrelated source (meaning, you cannot purchase your house from a spouse, parent, grandparent, child, or acquire the property by gift or inheritance).

Home ownership is a great way to boost the economy and an even better chance for you to start building wealth.  With home ownership, the longer you pay on your mortgage, the more you pay your home off.  Another advantage of home ownership is that you get to take advantage of the appreciation.  The average home price increases in value over 4% per year.  So if you are buying a $200,000 home, you can essentially increase your net worth by $8,000 per year.  Once you add the tax advantages of homeownership, you can clearly see why many of the wealthiest people in the country own real estate.

So...if you’ve been wanting to buy your home and take advantage of the low home prices, this is your opportunity but you must hurry…this bailout program ends December 1, 2009.  The next step is to get pre-approved.  You can do this by calling me directly at 630-246-6100 Extension 5.