The Days Are Getting Longer But April 30th is Approaching Quickly.....

If you're a potential homebuyer, you need to move quickly if you want to beat the April 30 deadline for the federal tax credit. That deadline applies to both first-time buyers (who are eligible for a credit of up to $8,000) and current home owners purchasing a new or existing home (up to $6,500).  Any buyer looking to take advantage of this opportunity must have a contract in place to purchase by the end of April, however, settlement can take place as late as June 30.

The timeline for buying a home is the same regardless of whether you are trying to take advantage of the tax credit. First, you need to evaluate your budget so you know how much you want to spend on housing payments each month. Stick to your budget to make a decision you will be comfortable with -- too many people have found themselves with a mortgage payment which crushes their ability to save any money for other needs or to spend on things that are important to them.

Next, find a trustworthy lender who will work with you to find the best mortgage loan to fit your needs. Most people today opt for the safety of a 30-Year fixed-rate loan, especially since interest rates are so low. But there are occasionally times when a 15-year fixed-rate loan or even an adjustable rate loan makes sense. You will also need to decide whether an FHA-insured loan works better for you and to decide whether to pay discount points or not. A lender can go over the short-term and long-term effects of these decisions.

Once your financing and budget are in place, you'll need to move quickly to find a home which fits your budget and your needs. Allow yourself at least a week or two before that April 30 deadline to negotiate with the home seller.

This credit is very appealing for those in the market but don't let it drive you to make a decision you will later regret. While it is terrific to get back money from the federal government, remember this will be your home for years (perhaps decades) to come -- so it is best if you love the home as much as you love your tax credit.