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Increase Your Sales With First Time Buyers
By C. J. Coury
The stimulus plan that President Obama signed on February 17th contains a provision for first time home buyers that will make a HUGE impact on their purchase decision.
Unlike its $7,500 predecessor, which was nothing more than a loan, the new income tax credit is truly what it appears to be – a credit! Under the new plan a first time buyer (defined as someone whom has not owned a home in the last 3 years) will receive a tax credit of 10% of the purchase price of the home with a cap of $8,000. To qualify for the credit the closing must take place between 1/1/09 and 12/1/09 and is a significant gain for this group of potential buyers.
On a typical first time buyer purchase this tax credit will actually exceed their out of pocket costs to close. For example, on an $180,000 purchase, using FHA financing and seller paid costs, the buyers out of pocket would equal $6,300. When they file their 2009 tax return they will receive a tax credit of $8,000 leaving them with a net gain of $1,700!
Unlike the -0- down payment loans that proliferated in recent years, this tax credit requires buyers to make the required down payment and leaves the loan amount at 96.5% of the purchase price. This is no different than what any FHA buyer would be able to receive. The major difference here is that they will be given a tax credit that they can use to purchase home furnishings, window treatments, home improvements, etc. that will help the local economy in the future and provide them with an improved lifestyle.
Get the word out to those renters who have been waiting on the sidelines for the right time to buy as that time is NOW!!
C. J. Coury is a Senior Vice President with Bank of America and oversees their residential mortgage division serving Sarasota, Manatee and Charlotte Counties. Prior to joining Bank of America in 1995, C. J. was President of Mortgage Brokers of America in Birmingham, MI for 7 years. He has been an active mortgage finance professional since 1983. C. J. may be reached at (941) 952-2888 or by email at charles.j.coury@bankofamerica.com [2].
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