Act Now To Get First Time Buyer Tax Credit
The $8,000 tax credit for first time buyers is working, drawing new people into the market and providing a big reason for growing home sales in metro Albuquerque.
While the program ends November 30, as a practical matter, it ends in early September. That's because it typically takes from 45 to 60 days from signing a purchase agreement until a sale closes. You must close and fund on your new home by November 30 to quality for the tax credit.
The $8,000 tax credit is only for first-time home buyers. The law-the American Recovery and Reinvestment Act of 2009-defines "first-time home buyer" as someone who has not owned a principal residence during the three-year period before the purchase.
The tax credit is refundable. It could mean cash for you. If you pay less than $8,000 in federal income taxes, the government will write you a check for the difference.
Home buyers who file as single or head-of-household taxpayers can claim the full $8,000 credit if their modified adjusted gross income is less than $75,000. For married couples filing a joint return, the income limit doubles to $150,000.
The tax credit especially appeals to people seeking more affordable homes. Inventories are low in this range. Homes are selling quicker and for higher prices. It's a sellers market for more affordable homes. If "more affordable" describes your home and you are considering selling, it is a good time to move up, to get that extra bedroom..
For higher priced homes, however, it's a buyers market. Inventories remain high for these homes. Plenty of choice exists and you can still get a good deal.
For first time buyers, the New Mexico Mortgage Finance Authority created the Tax Credit Loan Program to help with the down payment and closing costs. A first-time homebuyer can borrow 8% of the sales price or $6,500, whichever is less, and use the tax refund to repay the loan.
Contact any Coldwell Banker Legacy agent to explain the tax credit program and find your new home.
