2009 Economic Stimulus Plan benefits to Home Owners and Buyers
Expansion of Home Improvement Tax Credit
---Tax credit for making energy efficient home improvements is 30% of costs of improvements to max of $1500.
Higher Reverse Mortgage Loan Limits
---Loan limits for FHA-insured reverse mortgages increased to $625,500 for the entire country
$729,750 FHA and Conforming Loan Limits Restored in High Cost Areas
---Higher limit was in force for 2008 but reduced to $625,500 in 2009. Stimulus plan restores the $729,750 limit
First-Time Home Buyer Credit
Definitions:
Principal residence (not 2nd home or investment)
1st Time Home-buyer: Buyer, including buyer’s spouse, have not owned a principal residence for last 3 years.
Income Limits: Full credits with adjusted gross income of $75,000 ($150,000 on joint return) or less. Phased out over $95,000 and $170,000
2008 purchases (4-9-08 to 12-31-08)
$7500 tax credit repaid over 15 years, starting 2010
When sell, have to repay balance at sale
2009 purchases (1-1-09 to 12-31-09)
$8,000 pure tax credit (no repayment as long as held for 3 years, if sold during 3 year term, entire amount repaid)
Tax Credit for New Construction Home Purchases
From 3/1/09-11/30/09, $10,000 State tax credit spread over 3 years for new home purchases from any Buyers. Limited amount of funds available from CA so will probably end before expiration date
The New Foreclosure Stability and Affordability Plan
---Mortgage remodification will help homeowners in danger of foreclosure by readjusting their interest rates down and lengthening the term of their loan by five years. Principal remains the same.
Most homeowners in Bay Area will not be able to refinance existing loans because only applies to conforming loans ($417,000 or lower) AND the home can’t be underwater by more than 5%. In
Nationally, this can help 25% of people
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