Michigan Home Buyers: Did You Know About the Tax Credit that’s NOT Expiring on April 30, 2010?

daisyThese past couple of months have seen a major increase in real estate activity in the West Michigan area.  It seems that many potential home buyers are rushing to beat the deadline to qualify for the  Home Buyer Tax Credit which provides up to $8,000 for qualified first time home buyers and up to $6,500 for buyers of second homes.

But in all the hustle and bustle, there’s another Tax Credit which will CONTINUE to be available to qualified home buyers long after the deadline for April 30, 2010 has past. It’s the MCC Tax Credit,  a federal program that allows new, qualified home buyers to take up to 20% of their annual mortgage interest to be credited against their tax liability.

This program is available from participating lenders in Michigan to Michigan home buyers on a first served, first come basis.  Interested in learning more…Click here.

If you’re an investor or purchasing a home which will require some rehabilitation, there are mortgage programs which will allow you to do this.  If you’d like a referral to a lender who is qualified to process these transactions, please contact us at 616-791-0511.

Use Your Tax Credit to Buy a Home Now! Monetizing the $8,000 Home Buyer Tax Credit

 

Step 1:  Determine if You Qualify:  Status, Income, Credit, Price

Step 2.  Pre-Qualify for your Home Loan

Step 3.  Find Your Home

Step 4:  Obtain your Funds

For a detailed review of your specific situation, contact us at info@auduhomes.com or call 616-791-0511

 

 

UPDATE #2:  May 19, 2009…

Click this link for an update regarding the Monetization of the New Home Buyer Tax Credit Information from HUD & NAR (National Association of Realtors ®)

UPDATE: 5/16/2009…It appears that there is some additional information which will be forthcoming from HUD & NAR regarding this issue and FHA guidelines for homebuyers.  This post will be updated as soon as the latest information becomes available regarding the details of the proposed monetization of the new home buyer tax credit.

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Original posting:  May 12, 2009

In an announcement yesterday to participants in the mid year National Association of Realtors meeting in Washington DC,  the  HUD Secretary Shaun Donovan said that HUD will allow its’ lenders to permit homeowners to use the tax credit for a new home purchase as a downpayment. (Credit available for those purchasing a new home for the first time or who have not owned a primary residence for the past 3 years)

Here are excerpts from the article published by the National Association of Realtors.  The full article can be accessed here.

Shaun Donovan, secretary of the U.S. Department of Housing and Urban Development, said that the
Federal Housing Administration is going to permit its lenders to allow homeowners to use the $8,000 tax credit as a downpayment.

Donovan’s remarks came in an address to several thousand Realtors®gathered this morning at The Real Estate Summit: Advancing the U.S. Economy, a special daylong session at the Realtors® Midyear Legislative Meetings & Trade Expo here.

Secretary Donovan said that important changes, which the National Association of Realtors® has been calling for, will help consumers purchase a home. “We all want to enable FHA consumers to access the home buyer tax credit funds when they close on their home loans so that the cash can be used as a downpayment,” Donovan said. According to Donovan, the FHA’s approved lenders will be permitted to “monetize” the tax credit through short-term bridge loans. This will allow eligible home buyers to access the funds immediately at the closing table.

Click to continue reading…

If you’ve been thinking about purchasing a new home in Grand Rapids, MI as a first time home buyer and wondering where you would find the cash for the downpayment, this may be just the break you’re looking for!

Related Posts:

Spring Market (2009) Update

What Does the Tax Credit Mean For Grand Rapids, MI Homebuyers

 

What Does the Homebuyer Credit Mean for Grand Rapids, Mi buyers?

How does the new Stimulus Bill affect me?

This is a question that many home buyers in Grand Rapids, MI have been asking since the bill was recently signed into law by President Barak Obama earlier in the week.

Here are some of the most significant components in a nutshell:

1.  Defining “First Time Home buyers”

You’re a first time home buyer if you have not owned a principle residence within the past three years.  (The date of purchase is considered the day when your title is transferred).  Folks who have a vacation home, but NOT a principle residence may technically still qualify. For an evaluation of your specific situation, you are advised to consult with a qualified loan professional.

2.  It’s now Eight Grand….$8,000!

The number for the tax credit has bounced around a bit.  The first tax credit passed last year under President Bush was for up to $7,500…but you had to PAY IT BACK within 15 years.  Then the senate passed a bill which increased the provision to up to $15,000, but this had to be reconcilled with the house version which was considerably lower.  The Final Compromise is capped at  $8,000 which DOES NOT NEED TO BE REPAID.  The credit is equivalent to 10 percent of the purchase price for your new home and only applies to first time home buyers who are purchasing principle residences.

3.  Are there Income limits?

Yes, there are income limits.  If you’re single, you only qualify if you make a modified adjusted gross income of $75,000 or less.  This income limit increases to $150,000 if you’re married.  You may be eligible for a reduced credit if your income exceeds these limits.  Talk with a qualified loan originator to discuss you particular situation.

4.  How long is this for?

A lot of you are wondering how long this credit will be for and if it is retroactive.  This credit is only retroactive to the beginning of 2009 and will end at the beginning of December 2009.  If you bought a home last year which qualified for the $7,500 tax credit, you will NOT be able to take advantage of this new provision.  However if you purchased your home in January 2009 or the early part of February prior to the bills passage, you will.

5.  Do I have to Pay Back the Money?

The credit offered to home buyers in the 2009 stimulus package does NOT need to be repaid.  Also…because the tax credit is ‘refundable’ qualified buyers can take advantage of this credit even if they do not have much tax liability.  Now…you must stay in your house for at least 3 YEARS to fully benefit from the credit.  If you move before you’ve been in your home for 36 months, you will have to return the money to the government.  There are however some exceptions in the event of a death or divorce.

If you’d like to compare the differences between the 2009 home buyer credit and the 2008 home buyer credit, contact us at info@auduhomes.com.  We can send you a chart which details the differences in a clear, concise way.

Other related articles:

CNN Money article on the initial proposal of $15,000.

Winners & Losers in the Final Stimulus Bill

Visit www.auduhomes.com to search for Grand Rapids, MI homes