If you are a first time home buyer and wish to take advantage of the $7,500 tax "credit" (I say credit lightly) you had better act fast. The tax credit was passed with the Housing and Economic Recovery Act. The tax credit runs from July 1,2008 through July 1, 2009.
What are the qualifications?
- You need to be a first time home buyer
- You need to purchase/close before July 1, 2009
- Tax credit of 10% of your homes purchase price with a maximum amount of $7,500
- Individuals have to make less than $75,000 per year
- Couples have to make less than $150,000 per year
Things you may not know but NEED to know...
- You have to pay it back! Basically you are getting a interest free loan for 15 years. Your first payment is due within two years.
- If you sell your home before the 15 years, you owe any remaining amount of the loan back if you make a profit.
So, if you wish to take advantage of this tax credit you need to act quickly. Some would argue highly, including myself, to put this money away for a rainy day - knowing you will have to slowly pay it back. Why not invest it safely in the meantime and earn money on your interest free loan?
According to REBAC, "About 2.5 million first-time buyers are expected to take advantage of the $7,500 tax credit between now and the middle of next year". Are you going to be one of them?
I look forward to your questions and comments...