$8000 Home Buyer Tax credit Gets a Little Jolt

 According to Realtor.org, the HUD (U.S. Department of Housing and Urban Development) secretary has announced that the FHA(Federal Housing Administration) is going to permit its lenders to allow home buyers to use the $8,000 tax credit as a downpayment.

This is excellent news for our Grand Rapids Real Estate market. Local home buyers are already taking advantage of the federal tax credit and this latest incentive will encourage potential buyers to take the next step. “We all want to enable FHA consumers to access the home buyer tax credit funds when they close on their home loans so that the cash can be used as a downpayment,” Donovan said. According to Donovan, the FHA’s approved lenders will be permitted to “monetize” the tax credit through short-term bridge loans. This will allow eligible home buyers to access the funds immediately at the closing table.

Here are the recent modifications to the 2009 First Time Homebuyer Tax credit. Click Here for Details.

• It has increased from $7500 to $8000 but it is capped at 10% of the purchase price.
• It is no longer a loan, it is a true credit to home buyers but the buyer must remain in the home for 3 years.
• It is STILL only for “first time” home buyers, which is defined as someone that hasn’t owned real estate in the last 3 years.
• It is applicable for anyone that buys or has bought 1/1/2009 and 12/1/2009, extending the date from 7/1/2009.
• Full credit is available to those making $75,000 or less or $150,000 for joint filers.

For more information on the Grand Rapids Real Estate market, visit me online at GRRealEstateInfo.com or contact me any time.

So what was a $7500 “First Time” home buyer tax credit, then it was reported to be a $15,000 home buyer tax credit, was changed at the last minute to an $8000 home buyer tax credit.

So basically, this is what we ended up with:

• It has increased from $7500 to $8000 but it is capped at 10% of the purchase price.
• It is no longer a loan, it is a true credit to home buyers but the buyer must remain in the home for 3 years.
• It is STILL only for “first time” home buyers, which is defined as someone that hasn’t owned real estate in the last 3 years.
• It is applicable for anyone that buys or has bought 1/1/2009 and 12/1/2009, extending the date from 7/1/2009.
• Full credit is available to those making $75,000 or less or $150,000 for joint filers.

It would have been much better for them to make this tax credit available to everyone, not just those that have owned real estate in the last 3 years, but still it is a good incentive and together with the low interest rates and falling prices, it is a good time to purchase a home or condo.

For information on buying or selling real estate in Grand Rapids and the surrounding areas, please visit my website at GRRealEstateInfo.com or contact me any time.