Orlando mortgage borrowers seeking to take advantage of the first-time home buyer tax credit have only 15 days to get under contract on a new home. This program expires November 30, 2009, which puts you out only 60 days from today.
Do closings happen within 60 days from the time you start looking for a home? Sure, it’s possible. But the norm lately has been right around this time frame when you consider that it takes first-time buyers as many as 2 weeks to find a home on which they want to bid.
Put another way – Orlando mortgage borrowers not under contract to buy a home by October 15 have a very small chance of meeting the November 30 deadline. Miss this “due date” and there’s little chance of your claiming the tax credit. Note: This is expressly true for those of you looking to benefit from short sales or foreclosures.
First-Time Home Buyer Tax Credit Basics
The First-Time Homebuyer Tax Credit program was put into effect as part of the 2009 economic stimulus plan. IRS Form 5405 provides the details on this program’s qualification requirements and includes the following rules:
- Home buyers may not have owned a “main home” in the past 36 months
- The home may not be purchased from a parent, spouse, or child
- Adjusted gross income for the household must be below $95,000 for single tax filers and $170,000 for joint tax filers
The credit maxes out at $8,000 or 10% of the purchase price, whichever is less, and what makes this tax credit so great is that it is an actual credit – not a deduction. This means that if an Orlando mortgage borrower claims the full $8,000 and has a “normal” tax bill of $5,000 – she would receive $3,000 in cash from the US Treasury when her tax return is processed by the IRS. Sweet!
However, it won’t be so sweet for you if you can’t close by November 30, 2009. Miss this deadline and you miss out on the cash.
To borrow a tried and true idiom — “the clock is ticking.” If you’re planning to use the First-Time Home Buyer Tax Credit, the time to act is now. Give me a call at (863) 604-3019, or catch me over at The Florida Mortgage Blogger, so I can get your pre-approval process under way and get you on the road to tax credit heaven!
