Tax Credit Extension Confirmed

As expected, President Obama signed H.R. 3548 this morning which, among other things, extended the $8,000 tax credit for first-time buyers into 2010.

“Florida residents enjoy two additional advantages,” says Florida Realtors Vice President of Public Affairs John Sebree. “The Florida Homebuyer Opportunity Program (FHOP), created by the Florida Legislature earlier this year, still has approximately $28 million that first-time homebuyers can access and use toward their downpayment. And move-up buyers now have the ability to ‘port’ their current property tax savings to a new home.”

Under the new law:

• A purchase must be under contract by April 30, 2010
• A purchase under contract by April 30 must close no later than June 30, 2010
• After Dec. 1, 2009, income limits rise to $125,000 for singles and $225,000 for married couples; up from limits effective through Nov. 30 of $75,000 for singles and $150,000 for married couples. The tax credit phases out incrementally at each $20,000 increase in income.
• Effective immediately: The maximum home value purchased cannot exceed $800,000. Prior to the law being signed, first-time homebuyers had no limitation on a home’s cost.

$8000 Homebuyer Tax Credit Extension Likely

This afternoon, the extended life of the $8000 first time home buyer credit looks like a "go" to extend it beyond its scheduled November 30th deadline! The extension was added as an amendment to an existing bill, HR 3548, that extends unemployment benefits. The U.S. Senate passed that bill on Wednesday and, after debate, the U.S. House passed HR 3548 this afternoon. It now needs only President Obama’s signature to become law, and the White House has indicated it will sign it, perhaps as early as tomorrow.

In addition to extending the tax credit for first-time homebuyers, the bill adds a smaller tax credit for homesteaded homebuyers who have lived in the house for five of the past seven years that are looking to make a move to a new home. This could bode well for those looking to relocate here to the Tampa Bay area and planning to sell their home up north. More about the $8000 First Time Home Buyer Credit.

The bill also increases the income limits of homebuyers from $75,000 (single) to $125,000; and from $150,000 (married) to $225,000. After the president signs the bill and extends the tax credit, the Florida Homebuyer Opportunity Program – a down payment and closing costs assistance program relating to the federal tax credit –automatically gets extended too. The state still has about $28 million available for homebuyers.*

The money is essentially a loan to first-time buyers; they receive it upfront, use it for a down payment or other costs, and pay it back once they get their federal refund.

Mortgage Rates Dip Below 5%

McLEAN, Va. – Oct. 2, 2009 – Rates on 30-year home loans dropped below 5 percent for the first time in four months, but still remained above this year’s record low, Freddie Mac said Thursday. The average rate on a 30-year fixed mortgage was 4.94 percent, down from 5.04 percent last week, Freddie Mac said. The last time the 30-year home loan averaged less than 5 percent was the week ending May 28, when it was 4.91 percent. Rates hit a record low of 4.78 percent hit in the spring, and remain appealing for people interested in buying a home or refinancing.

On Thursday, the National Association of Realtors said the number of signed sales contracts rose for the seventh straight month in August, as homebuyers rushed to take advantage of a tax credit for first-time owners that expires in November. “Low mortgage rates are helping to stabilize home sales,” said Frank Nothaft, Freddie Mac’s chief economist. But borrowers may want to consider the Federal Reserve’s announcement last week that it is slowing down a program intended to lower mortgage rates and boost the housing market. Analysts say mortgage rates should remain low for now but could eventually move higher, and homeowners who want to refinance mortgages shouldn’t delay.

The primary reason mortgage rates are destined to move up is the HUGE amount of money recently printed by the Fed which helped stabilize the declining economy and avoid a financial collapse. This money will eventually have to be pulled back out of the system, which will result in substantial increases in lending rates. The banks will have less money to lend which in turn will drive rates up.

On The PURTEE Team website, we have a great feature which allows a potential buyer to review competitive mortgage rates and even apply online! Mortgage Info

$8000 New Home Buyer Credit Due To Expire In November

Over $1.2 million buyers have taken advantage of the $8,000 new home buyer tax credit since its inception. Of those, 350,000 would not have purchased if not for the tax credit available to them, according to the National Association of Realtors. Currently, the credit is scheduled to expire November 30, 2009.

As the current deadline for the credit looms, potential homebuyers need to complete a contract, satisfy any contingencies, secure financing and go to closing by Nov. 30. In today’s market, NAR estimates that it generally takes between 45 and 60 days from contract to closing.“That means potential homebuyers who qualify must act now, and so must Congress,” says NAR president Charles McMillan.

Directly from our website, you can compare mortgage rates, apply for a loan and find out exactly how much home you can afford in order to take advantage of this credit before it expires. Go to www.floridagulfproperty.com and click on Mortgage Rates or Apply For A Loan.