Friday the St. Petersburg Times stated that Governor Christ signed a bill to allow for the First Time Homebuyer Credit to be used as down payment and I am getting numerous emails regarding the details so I wanted to take a moment and update everyone. 

GOP Plan Aims to Expand Home Buyer Tax Credits

By Renae Merle

Washington Post Staff Writer

Wednesday, March 25, 2009;

House Republican leaders plan to unveil a housing package today that would increase the tax credits available for home buyers and would direct law enforcement to crack down on mortgage fraud.

Under the proposal, borrowers refinancing their mortgage would be eligible for $5,000 to help cover closing costs or to reduce their principal balance. The plan also revives a $15,000 home buyer tax credit proposal that Republicans pushed last year. This time, the proposal would require the borrower to have at least a 5 percent down payment.

Both programs would expire in July 2010.

 ”We want to make sure responsible homeowners are able to purchase homes and stay in their homes,” said House Minority Whip Eric Cantor (R-Va.), who will introduce the legislation. “If you can get a $15,000 tax credit, that is a tremendous incentive to get qualified buyers back into the game.”

Currently the home buyer tax credit is 8,000 if you purchase a home before 12/31/2009

Should you buy now? Discounts look favorable in Tampa Housing Market-2009

Here’s a column from today’s St. Petersburg Times:  It’s actually the most cut and dry, easy to understand article that I’ve seen. It explains all the ways you can use today’s Tampa Real Estate Market, Low Interest Rates and the National Home Buyer Tax Credit to your advantage. 

It’s a terrible time to buy a home, the naysayers claim. They cite the uncertain job market, the threat of further home price declines, the plundering of retirement accounts. At the risk of raining brimstone on my head, I’ll take the opposite view.

Home buyers enjoy three discounts that might not survive 2009: a foreclosure discount, a tax credit discount and an interest rate discount.

Let’s start with a typical $180,000, three-bedroom, two-bath home for sale in almost any city or suburb around the region.

Foreclosure houses — repossessed by the bank or soon to arrive at that dismal destination — have been selling for about 75 percent of the price of regular homes. The market is rich with such bargains. So let’s take 25 percent — or $45,000 — off the top of that $180,000 home.  That makes $135,000.

Clearwater Yacht Club

We’ll move on to the $8,000 federal tax credit for first-time home buyers. The government defines that as someone who hasn’t owned a primary residence in the past three years. And the beauty of the tax credit is that you won’t have to pay it back, if you stay in the home for 3 years

But to get the $8,000 you have to buy a house by December 2009. Take that $8,000 off the $135,000. We’re down to $127,000. So far, so good.

We still haven’t added in the interest discount. Rates have fallen to historic lows. This week you could get a 30-year fixed mortgage for about 5.2 percent, as long as your credit’s good and your job pays enough. That’s a point lower than rates from 2006, when Tampa Bay area home prices peaked.

Economists predict rates will rise next year as the economy recovers. Shaving off that point saves you about $1,000 a year on your loan. Assume you’ll live in the house six years. That’s close to the average stay in these parts. That’s an additional $6,000 to subtract. So that’s $180,000, minus $45,000 for the foreclosure discount, minus $8,000 for the tax credit discount, minus $6,000 for the interest rate discount.

Our home price is down to $121,000, a tad below the Tampa Bay area’s median sales price for January.  Not a bad deal.

February 27, 2009 | Permalink

The only catch I feel; according to the article is coming up with 10% down to do conventional financing. You can always ask the seller’s to pay for a portion of closing costs and prepaid items, however banks have their limit as to how much a seller is allowed to contribute. 

An FHA approved home or condo only requires 3.5% down, which I think is a better option for some home buyers who may be purchasing their first home.

If you are in the market to buy a home we would be happy to help you find the best neighborhoods in the Tampa Bay Area. Email: realtyrae@yahoo.com with the subject: buyer’s agent.

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GREAT NEWS!!!!

We are now able to use last year’s maximum loan limits on FHA which in Hillsborough, Pasco & Pinellas is $292,500

(much better than the &$271,050 we were rolled back to).

Don’t forget about the 8,000 tax credit for home buyers. This is not just first time home buyers, it is for anyone who hasn’t owned a home for the past 3 years.  This program will expire at the end of 2009.

If you are looking for a Real Estate Agent in the Tampa Bay area, please give us a call:

813 784 7744  ask for Rae.  Or email: realtyrae@yahoo.com

The American Recovery and Reinvestment Act of 2009

ENHANCED HOME BUYER CREDIT

Who Qualifies?: Anyone who has not owned a home for the preceding three years. That means you may still qualify for the incentive even if you and your spouse owned a home more than three years ago.

How Much?: The incentive calls for a credit of ten percent of the purchase price up to a maximum of $8,000 for a single resident or a married couple filing jointly.

Are There Limits?: The credit is phased-out based on your modified adjusted gross income (MAGI).

How Does It Work?: The tax credit reduces a your tax bill or increases your refund, dollar for dollar. It is fully refundable, meaning that the credit will be paid out to you, even if you owe no tax or the credit is more than the tax that you owe. Even better, there is no repayment requirements associated with this incentive if you keep your home for at least three years.

What are the valid dates to purchase a home?:  The incentive is for homes that close between January 1, 2009 and November 30, 2009.

Principal Residences: The tax credit is available for purchases of principal residences. Purchases of vacation homes and rental property are not eligible.

To request more information on how to purchase a home using the new home buyer tax credit send an email to: info@thetamparealestateinsider.com

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