Taxes, Incentives and Credits, Oh My!

Owning a home is its own reward, but homeownership can also bring rewards at tax time.

This year is especially beneficial for people who are in the market to buy a home, thanks to the
$8,000 first-time buyer credit and the $6,500 tax credit for repeat buyers.

Current homeowners can benefit, as well. Tax credits are available for owners who undertake certain projects to improve the energy efficiency of their home, including replacing exterior windows, skylights and doors and installing efficient heating and air conditioning systems.
Certain home improvements may qualify for as much as 30 percent of the project cost, up to $1,500.

Homeowners also enjoy a mortgage interest deduction; allowing them to deduct all the interest paid on up to $1 million in mortgage debt.

Article taken from NAR, "Home Delivery"

Crunch Time

The time is coming near...the first time home buyer tax credit is coming to an end on April 30th. So if you qualify as a first time home buyer...BUY NOW!!! Now is the best time to buy a home, because the rates are at an all time low and the home prices are at it's lowest...since...forever. No where else in the world would someone pay you to purchase a home. Right now, The United States will pay you to buy a home, not many times in life can you say that.

Take advantage of the tax credit and buy a home today.

Here's what you need to do:

1. Close on your home purchase between November 7, 2009 and April 30, 2010, or have a binding written contract by April 30, 2010 and close by July 1, 2010.
2. Decide whether to: apply the credit to your 2009 tax return, filed on or before April 15, 2010;
file an amended 2009 return; or, apply the credit on your 2010 return, filed on or before April 15, 2011.
3. Attach documentation of purchase to your return.

Will Short Sale be easier?

Most buyers when they see a short sale home, they either think that they are going to get a good deal or look the other way. Most buyers are looking the other way because short sales tend to take some time before it closes, ranging from two months to as long as ONE year waiting for the third party approval, the bank. Most buyers lose interest quick, especially if they are first time buyers hoping to take advantage of the First Time Homebuyer Tax Credit. However, the government are going to implement some new policy to streamline the process.

"On April 5, 2010, the U.S. government will implement the Home Affordable Foreclosure Alternatives Program. Part of the Home Affordable Modification Program, HAFA helps homeowners who are unable to retain their home under HAMP by simplifying and streamlining the use of short sales and deeds-in-lieu of foreclosures. Homeowners must meet certain requirements to participate and incentive payments are provided to homeowners and servicers."

Now when buyers are looking at short sale homes, lets hope they will be more reluctant to look and purchase the home.