First-Time Home Buyer Tax Credit: Buy it in 2010 and Claim it for 2009

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With the first-time home buyer tax extension, many buyers are once again swarming into the market. If you haven’t already started looking for a house, here are a few reminders why you should buy your first (or second) within the next few months.

- Property values are insanely low. Homes are still going for about half the value they were appraised for just two years ago. This won’t last long with an increasing demand buying up foreclosed homes.

- Interest rates and mortgage rates have hit an all time low. With a recovering economy, this also won’t last much longer.

- Up to $8,000 for first time buyers, and $6,500 for existing homeowners who have lived in their home for more than 5 years.

Also, if the cost is what’s keeping you renting, keep in mind that homes are so cheap now – you can literally spend less on your monthly mortgage payment and taxes than you do renting. And while FHA loans can be for any type of buyer, first-time buyers can especially benefit from the low down payment and flexible credit requirements.

So now the question becomes, if I buy in 2010, don’t I have to wait a whole year to claim it on next year’s taxes?

Here’s the good news. You can buy a home in 2010 and still claim it on your 2009 taxes so you get the tax credit early. According to the IRS website: “For all qualifying purchases in 2010, taxpayers have the option of claiming the credit on either their 2009 or 2010 tax returns”.

With this option, you can now count on an extra $8,000 that comes with your new home. So don’t hesitate too long, as this tax credit won’t be extended again, so start looking today.

Related Information:

• Get more info about buying your own historic home from In-House Realty.
• Get started buying a home with the Quicken Loans Home Buying Center.
• Get started refinancing your mortgage with the Quicken Loans Home Refinance Center.

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