South Philly Real Estate Blog

Down to the Wire for the $8,000 Home Buyer Tax Credit

Time is running out to cash in on the $8,000 first-time home buyer tax credit as the November 30 deadline approaches. Thousands of buyers have already taken advantage of this tremendous opportunity, but there are only a few short weeks left for would-be homeowners to act.

 

Today’s home buying process takes time. Lenders are being more cautious about approving loans and are scrutinizing borrowers’ financial information more closely. This means that the days of settling on a home in two weeks are long gone. The typical closing process now takes at least eight weeks – about 60 days. Home appraisals are taking longer, and home inspections and title searches must also be factored into the process. According to Frank Jacovini, Broker of Philator.com Realtors®, home buyers need to be realistic about the time it will take between searching for a home and closing on the deal.

 

Homeownership is an investment in your future and shouldn’t be rushed.  Buyers who want to take advantage of the tax credit can save themselves a lot of stress and anxiety by getting the ball rolling sooner rather than later.

 

Those who assume the government will extend the tax credit beyond the November 30 deadline could be disappointed and miss out, since Congress has not indicated that the tax credit will be extended. The wisest choice qualified buyers can make is to take advantage of current market conditions – high inventory, low interest rates and affordability – while the $8,000 tax credit is still available.

 

The tax credit may not be the only thing buyers miss out on by waiting. Recent statistics and trends show signs the market has already hit bottom and is rising again. Prices have stabilized in many areas and while interest rates remain historically low, there is no guarantee they’ll remain low. Current conditions may not last much longer.

 

“There has never been a better time to achieve the dream of homeownership,” Jacovini said. “Delaying the process could jeopardize obtaining the home you want for the price you want and receiving money from Uncle Sam in return. The clock is definitely ticking”

 

courtesy of the National Association of REALTORS

Green Home, Greener Wallet: Tax Incentives Abound for Energy-Efficient Homes

 Thanks to Uncle Sam and some temporary tax credits, it pays right now to go green. Although a lot of attention has been paid to the $8,000 home buyer tax credit that was established earlier this year by the American Recovery and Reinvestment Act of 2009, that legislation also established a number of tax breaks for current homeowners who want to improve their home’s energy efficiency.

The Residential Energy Property Credit increases the energy tax credit for homeowners who make certain energy-efficient improvements to their existing homes, in many cases giving the homeowner a credit of up to 30 percent of the cost of the project. Most of the improvements must be made from January 1, 2009 through December 31, 2010, but some projects will be eligible for a tax credit through 2016.  These additional tax breaks reinforce the value of going green.

Realtors^Ò understand the long-term investment and savings associated with greener homes.  As green building issues become more important to buyers, sellers and businesses, more and more Realtors^Ò are adding value to the real estate transaction by developing green business practices and educating themselves and their clients about the benefits of energy-efficient home and building features.

Most energy-efficient improvements to existing homes now qualify for a tax credit of 30 percent of the project cost, up to $1,500. Exterior windows, skylights and doors with a qualifying U-Factor (which measures how well it insulates) and Solar Heat Gain Coefficient (which measures how well it blocks heat caused by sunlight) are eligible, as are certain metal and asphalt roofs. In addition, the credit covers installation costs for HVAC, gas, oil and propane water heaters and biomass stoves.

 

The deal gets even sweeter for owners who enhance their home with geothermal heat pumps, solar energy systems or small wind energy systems. They qualify for 30 percent of the entire cost – including installation – and the credit doesn’t expire until December 31, 2016.  

There are no upper or lower income limits on energy efficient tax credits. For detailed information about all eligible projects, visit energystar.gov/taxcredits.

This is an opportunity homeowners looking into “greening” their houses should consider.  

Realtors^® know what features add value to a home, and many of today’s consumers want homes that are sensitive to the larger environment.  This isn’t just a fad. Energy efficiency and the cost savings that come along with it will never go out of style.

Courtesy of the National Association of Realtors®

 

 

Tax Credit Advance Loan Program

Congress has enacted legislation providing a federal tax credit of up to $8,000 for first-time home buyers purchasing (and occupying in the case of custom construction) their principle residence between January 1 and November 30, 2009. This credit is available to single taxpayers with incomes up to $75,000 and married couples with incomes up to $150,000. A first-time home buyer is defined as a buyer (and his/her spouse) who has not owned a principal residence during the three-year period prior to the purchase.

 

For more information on the Federal First-time Homebuyer Tax Credit click here.

 

In Pennsylvania the Pennsylvania Housing finance Authority’s Tax Credit Advance Loan Program (TCA) allows Keystone Home Loan and Keystone Home Loan PLUS borrowers to apply a portion of their 2009 first-time homebuyer tax credit towards the purchase of their home. The program offers an advance in the form of a subordinate loan to those filing for the 2009 First-Time Homebuyer Credit (IRS Form 5405) on their 2009 tax returns. Due to limited funding, the program will be available to homebuyers on a first-come, first-served basis.

 

In New Jersey the First-Time Home Buyers Tax Credit Loan (“TCLP”) Program provides a loan to pay down payment and/or closing costs to Agency Home Buyer Program first-time home buyers who meet all of the requirements of the Home Buyer Program and who are eligible for

the credit as permitted by the federal law establishing the credit and the guidance provided by the IRS in the General Instructions that accompany IRS Form 5405 and who close on a home purchase between the start of the TCLP program and December 1, 2009. The loan will not exceed $5,000 ($4,000 in the case of married filing separately) and will be secured by a second mortgage. The borrower will pledge to apply the refunds received from the first-time home buyer tax credit toward the repayment of the TCLP loan.

 

For PA Program Eligibility and Details click here.

For NJ Program Eligibility and Details click here.

 

Keep the Stimulus Plan Focused on Main Street.

   The U.S. Congress and the White House must work together to enact a new housing stimulus package to boost the economy

 

The National Association of Realtors^® has submitted a four-point plan to lawmakers in Washington, D.C., that includes consumer-driven provisions that go beyond the economic stimulus law enacted earlier in the year. 

 

Our association fully supports this plan because it will help home buyers and sellers here in and contribute to a nationwide economic recovery.

 

The plan proposed by the Realtors^® would eliminate repayment of the temporary first-time home buyer tax credit that lawmakers established this year and expand the credit to all home buyers, make the increased FHA and conventional mortgage loan limits that will expire at the end of 2008 permanent, focus the economic stabilization efforts on supporting the housing and mortgage markets instead of providing capital to banks with no strings attached, and permanently prohibit large banks from entering real estate brokerage and management.

 

NAR research indicates that reducing mortgage interest rates, combined with removing the home buyer tax credit repayment, would reduce national housing inventory by 10 percent and would produce modest home price gains of 2 to 4 percent. Such price gains would add $760 billion in housing equity for the nation’s 75 million homeowners.  Certainly, there would be meaningful benefits in our own market.

 

There is no question – there cannot be an economic recovery without a stabilized housing market. Congress and the new administration need to act immediately to help families protect their homes, savings and futures.

 

Realtors^® here in Philadelphia are joining Realtors^® from across the country to ask members of Congress for quick action to end the nation’s housing and economic crisis and direct government help to America’s families.

 

The U.S. Treasury and Congress need to work together to ensure that the American people benefit from the economic recovery plan.  The Treasury Department has gotten off track by focusing too much attention and stimulus money on Wall Street and banks that are in turn using the money for mergers and acquisitions. The administration needs to get back to the original intent of the plan – stabilizing the mortgage and housing markets – to help families avoid foreclosure.

 

It is clear there can be no economic recovery without a stabilized housing market. As Realtors^®, we see firsthand the impact that an unstable housing market is having on communities like ours.  There is no time to waste.

 

 

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Forclosure Help From The City of Philadelphia

The City of Philadelphia has announced a new program to help homeowners who are facing problems keeping their home.  If you don't understand your loan documents, or your mortgage payments have suddenly increased or if the Sheriff's office has sent you a letter that you don't understand then call-

215-334-HOME. 

You can speak to a credit or housing counselor who can explain the terms of your loan and help you find out if your mortgage can become more affordable. 

There is NO charge for this service.

So if you are behind on your mortgage payments and facing foreclosure-get FREE help from the City of Philadelphia to save your home.

Also take a look at a past article on this blog for more help.  Click here to read