This week, Congress and the President passed the 2009 Stimulus Plan. If you are a first time buyer, there is an $8,000 tax credit available.

To qualify, you must:

  • Not owned a principle residence in past 3 years
  • Buy a home (house, condo, duplex, triplex or 4-plex apartment) from Jan 1, 2009 through Dec 1, 2009
  • Satisfy the income limits (make no more than $75,000 for single, $150,000 for couples, adjusted gross income)
  • The amount of the tax credit is 10% of the sales price up to $8,000 (up to $4,000 for single persons)
  • Keep the property as your primary residence for the next 3 years

This means that you will get up to $8,000 back from the federal government. The credit is basically FREE MONEY!!! To claim your tax credit, you can (per the IRS website):

  • File an extension Taxpayers who haven’t yet filed their 2008 returns but are buying a home before Oct 15, 2009, can request a six-month extension to October 15. This step would be faster than waiting until next year to claim it on the 2009 tax return. With an extension, taxpayers could file electronically, receiving their refund in as few as 10 days with direct deposit.
  • File Now, Amend Later Taxpayers due a sizable refund for their 2008 tax return but who also are considering buying a house in the next few months can file their return now and claim the credit later. Taxpayers would file their 2008 tax forms as usual, then follow up with an amended return later this year to claim the homebuyer credit (using tax form 1040x).
  • Amend the 2008 Tax Return Taxpayers buying a home in the near future who have already filed their 2008 tax return can consider filing an amended tax return. The amended tax return will allow them to claim the homebuyer credit on the 2008 return without waiting until next year to claim it on the 2009 return.

With the tax credit, you could really buy a house with little to nothing down, and get $8,000 to make your mortgage payments for most of the next year!  Here’s an example:

You want to own a house.  You call me and here is what we do:

Get qualified for a loan (there are many programs available through local, state and federal government that encourages home ownership).  If you qualify, I’ll help find you a loan that requires little to no money down (VA is really no money down-get your VA Certificate, FHA 203K is a few hundred down, FHA is $1,000 down when coupled with CHFA, etc.).

After you have a loan program, we find a house, duplex, condo, apartment that fits your budget.  I’ll write the offer so that the seller pays YOUR CLOSING COSTS (appraisal, taxes, insurance, loan fees, etc.) so that your out of pocket costs are minimized.

Using my knowldege, skill and experience, I’ll help and guide you through the entire process.  Upon closing, I’ll help you with the necessary IRS tax forms so that you can quickly claim your tax credit and get your money!  If your loan payment is about $8oo per month, with the tax credit, you could easily pay 10 months of your loan.