Hey, here is $7500 bucks. Pay me back interest free over 15 years (unless you can't sell your house for a profit)
This is deal being offered to first time home buyers with the tax credit that was passed earlier this year. However, no one seems to understand it or appreciate it.
I just had a VA buyer that was purchasing a home with no money down and receiving a seller concession for the full amount of the closing costs. Now, after he closes, he can expect an additional $7500 in his tax return check. Not a bad deal.
How Does the Refund Work?
It works like this. If you were going to originally receive a $1000 refund when you file your taxes in 2009 it will now be increased up to $8500 as a qualified first time home buyer. The original $1,000 due + $7,500 from the tax rebate.
Who is Eligible?
1) You must close between April 9, 2008 Through June 30,2009
2) You must be a first time home buyer, or not have owned a home in the last three years.
3) You must be buying a primary residence. No investment or second homes allowed.
4) To receive the maximum tax credit of $7500 your modified adjusted income for a married couple must be $150,000 or under. Its $75,000 maximum income for a single buyer. (Partial credits are available if you make more than these limits)
How is It Repaid?
Starting the second tax year after your purchase you have up to 15 years to repay the loan.
However, if you sell the home before 15 years, and realize no profit on your sale, the loan is forgiven.
Also, if there is a gain, the amount owed can never be more than the original credit allowed.