First-time Home Buyer
Congratulations! You are considering purchasing your first home! This is a giant step in making an investment in your future. There are many advantages to owning your own home and some preparation involved.
Breaking News - $8000 tax credit for first time home buyers!
The "American Recovery and Reinvestment Act of 2009," passed the House and Senate on Friday, February 13, 2009 and the President signed this bill on February 17, 2009. This new bill provides for a $8,000 tax credit that would be available to first-time home buyers for the purchase of a principal residence on or after January 1, 2009 and before December 1, 2009.
This credit does not require repayment as long as you stay in the home three years, or more.
A first time home buyer is defined as someone who has not owned a property in the last three years. This credit cannot be received if a first time buyer purchases a property to rent out. It has to be your principle residence. This credit applies if you purchase a single property residence, or condo, or a townhouse.
The income requirements are maximum $75,000 for a single buyer, and $150,000 for a married couple.
The credit will be claimed on a tax return to reduce the purchaser's income tax liability. If any credit amount remains unused, then the unused amount will be refunded as a check to the purchaser.
This is an unprecedented move by the administration and even more of a reason to invest in your first home! Click here for more information about the $8000 tax credit.
Advantages of Home Ownership
- Increase in personal savings as your principal and interest payments (monthly mortgage payments) are retained in the value of your home as equity.
- You can deduct the interest you have paid on your home annually and deduct the annual property taxes against your income taxes.
- If you maintain your home and take good care of it, chances are that it will increase in value over time and be the largest long term investment you will make.
- As the equity in your home builds you can "save up" for a larger or more expensive home.
- Home ownership gives you and your family a sense of control over your life and future.
Preparing for Home Ownership
- You will probably have to make a down payment of at least 3% of the purchase price. You many need to take some time to save up some money for your down payment.
- Your lender or bank will be checking your credit to qualify you for a loan. Check your own credit before hand and make sure there is not any incorrect information on your report. You may also need to work on your credit. If you have any bills that have gone to collections you will need to talk to your lender about this as unpaid bills will make it harder for you to get a loan.
- With your lender determine what monthly payment you will be comfortable with.
- And finally meet with a lender to make loan application. Once you are pre-qualified then you know what price range will work for you and your family.
Let's go find your new home!
Give me a call today! It would be a privilege to help you find and purchase your first home!