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Will The Government Pay YOU $15,000 to buy a Columbus Home for sale?
February 6th, 2009 categories: For Home Buyers, For Home Sellers, Market Updates, Mortgage/Finance, Real Estate News
The economic stimulus bill making its way through the Senate has a provision for a $15,000 tax credit to home buyers who purchase in the next year.
All I’ve really been able to discover is that the Senate unanimously passed the amendment to give a $15,000 tax credit to home buyers who purchase in the next year. (Will it be retroactive to Jan 1, 2009?)
While the tax credit, which is actually the lesser of $15,000 or 10 percent of the purchase price, never has to be repaid, there are a couple conditions on receiving it.
The purchased home must be a primary residence, not a second home or rental property. You have to use me as your Realtor when buying the home. (OK, I’m kidding about that) And, the buyer must own the home for at least two years, or pay the credit back.
If you’re closing on a home today or in the next week, you may want to consider waiting another week b/c we don’t yet know the effective date of this potential windfall and who wants to miss out (especially by a day or two) on 15 thousand dollars? And Sellers–Chill out and be OK with that because you’ll likely be on that end of the transaction soon enough.
While we’re waiting to hear more about how it all shakes out for Columbus area Home Buyers, here is another recap on what is already known about last year’s stimulus plan’s provision for a home buyer tax credit. This is a done deal…
Part of the Housing and Economic Recovery Act of 2008 includes a credit of up to $7,500 for homes purchased between April 9, 2008 and June 30, 2009. The tax credit is actually an interest-free loan that must be paid back over 15 years with payments beginning after a two-year grace period; for example a homebuyer who purchased in 2008 would start paying the loan back in 2010.
The $7,500 would come as a credit on the buyer’s income taxes during either 2008 or 2009, depending on when the
home was purchased; the loan would be paid back at a rate of $500 per year, through the buyer’s annual income
tax filing.
The $7,500 tax credit has higher income limits than many other assistance programs – $75,000 for singles and
$150,000 for married couples – so it may be advantageous to those buyers who don’t qualify for other programs.
However, because it cannot be combined with other programs such as the Ohio Housing Finance Agency, many
times buyers are better off taking advantage of those programs providing assistance in the form of grants, which
aren’t required to be paid back, said Marianne Collins, Vice President of Insight Bank.
Many programs such as OHFA are income and/or salesprice-limited. For example, to qualify for an OHFA program
a two-person household in Franklin County must earn $65,300 or below annually and the home’s maximum
sales price is $276,750.
Richard Stabile Bergen County Real Estate
February 10th, 2009
Incentives are great! However, the public needs 3 things. 1.) They need to know what all the programs that will be available. Mainly mortgages availability by the government, either the guarantee loan at a low interest rate or its true availability weather they qualify. People are sitting on the fence waiting to see what they can get before they commit.
2.) They need to see some confidence that the government programs funding banks and buying agency paper and mortgage bonds is going to work. There needs to be a buzz in the financial markets that there is money available to buy homes.
3.) The government needs to get all the money actually in the system so that the institution will promote their deals to the public. The new TALF -Term Asset-Backed Securities Lending Facility which was announced yesterday and promoted today 2/10/2009 brings money into the system.
The government is going to fund 90% of asset back securities with an investor’s 10% equity as non recourse loans.
I don’t know if it is the right thing, but if they are going to do it, they must get it done fast. The slipping must stop.
Buyers need the sizzle and the steak, right now the steak is there, but there is no buzz.
Richard