Posts Tagged ‘qualify’

As part of its plan to stimulate the U.S. housing market and address the economic challenges facing our nation, Congress has passed new legislation that:

• Extends the First-Time Home Buyer Tax Credit of up to $8,000 to first-time home buyers until April 30, 2010.
• Expands the credit to grant up to $6,500 credit to current home owners purchasing a new or existing home between November 7, 2009 and April 30, 2010.

Here is more information about how the Extended Home Buyer Tax Credit can help prospective home buyers become part of the American dream. If you have specific questions or need additional information, please contact a tax professional or the Internal Revenue Service at 800-829-1040.

Latest news:
Tax Credit Extension a Positive Step Toward Real Estate Recovery (Nov.5)
President’s Podcast: Tax Credit Extended (Nov. 5)

Who Qualifies for the Extended Credit?

• First-time home buyers who purchase homes between November 7, 2009 and April 30, 2010
• Current home owners purchasing a home between November 7, 2009 and April 30, 2010, who have used the home being sold or vacated as a principal residence for five consecutive years within the last eight.

To qualify as a “first-time home buyer” the purchaser or his/her spouse may not have owned a residence during the three years prior to the purchase.

If you or your client purchased a home between January 1, 2009 and November 6, 2009, please see: 2009 First-Time Home Buyer Tax Credit.

Which Properties Are Eligible?

The Extended Home Buyer Tax Credit may be applied to primary residences, including: single-family homes, condos, townhomes, and co-ops.

How Much Is Available?

The maximum allowable credit for first-time home buyers is $8,000.

The maximum allowable credit for current homeowners is $6,500.

How is a Buyer’s Credit Amount Determined?

Each home buyer’s tax credit is determined by two additional factors:

1. The price of the home.
2. The buyer’s income.

Price

Under the Extended Home Buyer Tax Credit, credit may only be awarded on homes purchased for $800,000 or less.

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First Stop – Get Pre-Approved

The excitement of buying can kindle urgency to set up your Home Tour. When you view homes the American Dream gets closer to reality. However, instead of jumping in to view homes first, the smart first step in the process should be arranging your financing. This focuses you on a price range of homes that matches your personal finances, instead of looking at properties beyond your means. It can be very disappointing to have to step back to a lower price range to obtain a mortgage.

Fluctuations in interest rates may influence the size of home you can qualify for. When rates are low you can qualify for more house than when the rates are high. Various loan programs can influence the amount you can borrow, the rate that you will pay, and the cash required. These factors will influence your purchase. When you make these decisions before you look at properties, you reduce the stress that accompanies financing uncertainty.

There is another important reason to qualify first. A seller will not negotiate in earnest if you cannot prove that you can obtain a mortgage. When you present an offer to a seller, you will provide written proof from a lender that you have been examined and qualify for a loan.

If you find the right property, you should make an offer right away. A delay while you arrange your financing might allow another buyer to buy the property. If multiple buyers make offers at the same time, it will be the buyer with the best terms who is fully qualified that will win.

Learn more about qualifying for your mortgage or Search ALL of Columbia’s Homes

Jody Calvin can be reached at 573-881-8771. Prudential Vision Properties is an independently owned and operated member of Prudential Real Estate Affiliates, Inc., a Prudential Financial company. Equal Housing Opportunity.