The Homebuyer Tax Credit of 2009

In the new stimulus package President Obama signed into law, among other things, is a new version of the homebuyer tax credit for 2009. There are some very noteworthy improvements as compared to the 2008 credit.

The 2008 tax credit, which was part of the Housing and Economic Recovery Act, gave first-time hombuyers a $7,500 tax credit if they purchased a home between April 9, 2008 and June 30, 2009. The new tax credit, which is part of the American Recovery and Reinvestment Act of 2009, increases the tax credit to $8,000 and is for home purchases that take place between January 1, 2009 and November 30, 2009.

The 2008 tax credit was an interest free loan from the government which would be repaid in $500 installments over 15 years. The 2009 tax credit does not have to be repaid. There is no change to the first-time homebuyer requirement. To take advantage of the credit a homebuyer must not have owned a home in the last three years, with few exceptions.

The remaining provisions are essentially the same. The homebuyer must occupy the home as their primary residence for at least three years, with few exceptions. There is still a phase out of the tax credit for singles making more than $75,000 and married couples making more than $150,000 and no tax credit for singles making $95,000 and couples making $170,000.

The tax credit is just that, a credit. A tax credit differs from a tax deduction in a very significant way. A tax deduction is a reduction of the amount of income one pays taxes on. A tax credit is a dollar for dollar reduction of the tax owed. If the homebuyer owes less than $8,000 in taxes the homebuyer will receive the difference in a refund (i.e., If your tax bill is $4,000, you will now owe zero and receive a refund of $4,000).

The homebuyer tax credit is an amazing move on the part of the government to stimulate the housing market. This credit should provide more than enough incentive for aspiring homeowners sitting on the fence about buying a home. The mix of phenominally low interest rates, reduced home prices, home sellers and lenders willing to pay closing costs, and the huge tax credit make this the best time in 10 years to buy a home. Who do you know who could and should take advantage of this awesome opportunity? I would be honored if you would refer them to me. I can be reached on my mobile number at (619)994-1110 or by e-mail at Shawn@YourFavoriteLender.com.

New Homebuyer Education Workshop Is A Hit!

On January 31, 2009, I hosted my first Homebuyer Education Workshop. I have contended for a long time that the current "housing crisis" is really an affordability issue. Lenders were so crazy and loose with the lending guidelines that virtually anybody and everybody who ever considered owning a house bought one even if it was only to flip it a short while later.

All of that competition flooding the market, known as high demand, caused house prices to go through the roof. It didn't take long for house prices to become unaffordable for the remaining interested buyers and the spiral downward began.

Now house prices have become very affordable again for many aspiring homeowners and word is finally getting out that it is time to buy. There are many amazing deals to be had out there. However, so we don't have a repeat of this housing crisis I have created a Homebuyer Education Workshop. In this workshop I provide attendees everything they need to know to confidently buy their own home. The real estate and mortgage markets have changed significantly in the last year and will continue to change going forward.

I know that buying a home can be complicated, which is why I designed this workshop. Anyone who chooses to attend will have a clear understanding of the current real estate market and gain answers to the following questions:

• Can you qualify for a loan? If so, what are the steps?
• How does owning a home compare to renting?
• What are the significant tax advantages to owning a home?
• Are tax advantages the only reason to own a home?
• How does the $7,500 government incentive for first-time buyers benefit you?
• What loan programs are available today?
• How much of a down payment do you need?
• Why is your credit score worth thousands of dollars and how you can improve and protect it?
• and much, much, more!
  

Seven aspiring homeowners showed up that Saturday and the feedback was awesome. For all intents and purposes I put on seven events that morning because each person that attended left with their own understanding of the materials and concepts presented. And each one said how glad they were that they attended because the information was relevant and timely and gave them confidence in moving forward with buying a home of their own.

I intend on hosting a Homebuyer Education Workshop each month and ultimately every two weeks. I believe anybody interested in buying a home should go through this type of educational workshop. If more people did maybe we wouldn't have the housing problems we're having right now.

If you have any family members, friends, or work associates that are interested in becoming homeowners I would be honored if you would refer them to my FREE Homebuyer Education workshop. I will let you know when the next one is as soon as I set the date, time and location.