A Windfall for the Homebuyer - The $15,000 Tax Credit

On February 4, 2009, the Senate passed an amendment to the stimulus package which will provide all home buyers with a $15,000 tax credit.  For many potential homeowners, this could be a "once in a lifetime" opportunity.  When combined with the FHA mortgage financing that requires a 3.5% down payment ( which can be gifted), average credit, and the Seller contribution to cover closing costs, the buyer will now have sufficient backup funds to cover unexpected expenses and provide a "cushion" for monthly mortgage payments.  The highlights:

1.  Effective date will be when the President signs the bill.

1. 2.  The tax credit is limited to 10% of the purchase price or $15,000.

2. 3.  This is for all buyers of primary residences for one year after the bill is signed.

The amendment received quick approval as most legislators realized that the housing market is a critical element in stimulating the economy.  Once first home buyers purchase a home, other home owners will now be able to move up and buy their second and third homes.  The builders will now be able to build and meet the needs of those move-up buyers.  The is process creates jobs and allows for the sales of goods and services.

There are other issues that still need to be addressed in the stimulus package such as foreclosures and the banking crises.  However, the $15,000 tax credit will have a significant impact and achieve the intended results. 

Now is the time to contact your lender and real estate agent to evaluate your options in taking advantage of this exceptional opportunity.