Tax Advantages for First Time Buyers - calling all pros...

How will the 8k credit turn into 15k? I'm missing something here...

I heard that they might expand to 15K without income requirements when this one expires in Nov....

Based on the latest deficit numbers, I think they would be committing suicide throwing yet more free $$$$, but i think its a 50/50 shot to go through....

new york state has a new program for 1st time, where you get a tax credit on some of your mortgage interest for 10 years i think.

http://nyhomes.org/index.aspx?page=898

i think the income limit is the same as for a sonyma mortgage, ~92K for a 2person household. You can't can't use the tax credit with the sonyma mortgage though. This tax credit can be taken on top of the 8K from the government. Don't forget that the 8K also has income restrictions.

that's called the "Mortgage Credit Certificate" (tax credit on 20% of interest paid, and the rest 80% can be deducted as usual).

http://www.nyhomes.org/index.aspx?page=63

there are also subsidized rates under the "achieve the dream" program (which also knocks 0.50% if you buy an energy efficient one). all these programs are income restricted and many have limited funding (which means 1st come, 1st service). also they are run by ny state, which means you cannot use it to buy in CT nor NJ...

thanks guys. i guess there are no extras for those who don't make the restrictons : (
but hopefully we will all be looking at 15k. only time will tell.

yep, almost everybody expects those to be extended (but so did people with the cash for clunkers though)

There is no way that Pelosi signs a bill that will remove the income restrictions....

That would be too fair to everyone....

lol, barron's run an article last weekend telling skeletor that covering existing conditions is NOT insurance (it's welfare as medicare) and that the healthy are already paying for the sick.

this issue is not gonna be solved neither this year nor next imho the way is going... the drama is just starting

i'm always amazed at people purchasing 1/2 Mill properties to get $8K... plain stupidity.

"i'm always amazed at people purchasing 1/2 Mill properties to get $8K... plain stupidity."

agree, but it can pay if the buyer is willing to walk away if the house losses value. hence, it's a risk free low hanging fruit.

but still it reminds me of a latin congressman that said in session that he had to look in the dictionary the difference between billions and trillions. "how many more zeros are in there?"

"i'm always amazed at people purchasing 1/2 Mill properties to get $8K... plain stupidity"

Ummmmmmm, how is this possible if the income restrictions would not allow a person purchasing that much house (assuming they dont pay in cash) to qualify for the 8K since they would have to make over $75,000 to qualify for a loan for that big of a house?

If they had a lot of non-taxable deductions for this year.

"For a married couple filing a joint return, the phase-out range is $150,000 to $170,000."

http://www.irs.gov/newsroom/article/0,,id=206291,00.html

so garelj, use FHA as an for example. 3.5% downpayment for a house which value is 3 times $150k. the tax credit ends up being almost exactly 1/2 of the downpayment.

Ok...your argument makes sense...

But then why is it stupid for people that are purchasing $500,000 houses that can use FHA 3.5% downpayment loans and get a $8,000 tax credit as it ends up being a complete risk free investment

Sounds smart to me, not stupid....

http://online.wsj.com/article/SB10001424052970204908604574334662183078806.html#mod=rss_opinion_main

smart for the borrower, not so smart for the taxpayer who'll need to pay when those subprime loans go south shortly.

What's another Trillion at this point....

yep garelj, it can be a smart move on the part of the homebuyer is it's approached that way (head he wins, tails it's the taxpayer loss).

it's not a smart move for those that don't even know that they can walk away (many don't know the difference between recourse vs non-recourse and the like)... they have no exit strategy, all their strategy might be to stop renting. so a less than 2% discount seems to be enough to entice them to make a purchase of a re-inflated asset (that's silly, on top of the fact that many do that choosing to spend more on housing than if they were renting). guess websites like "youwalkaway.com" are converting people from this second group to the 1st, creating more of the "ruthless" jingle mail.

The banks kind of deserve it, but since 50% or higher of new loans are FHA they could care less cause the Gov't, thus are taking it on the chin...

I remember hearing this before....ah yes, its called the MBS securization market....the only difference is the taxpayers take it on the chin instead of the investors...

At this point im totally convinced that the politicians are just too stupid to understand this whereas i thought it used to be they knew what they we're doing but they we're just going to help out their friends to do it...

Watching Maxine Waters on the House Finance Committee helped convince me of that....

And to watch her call Senators "Neanderthals" for not passing the Health Care Bill was kind of the kettle calling the pot.....

Well you get the point....

"At this point im totally convinced that the politicians are just too stupid to understand this"

most voters are homeowners and invest in the stock mkt through their 401(k), lets face it, they are buying votes (by reflating already inflated assets) for when 2012 comes while hoping the unintended consequences show later than 2016. that's all imho.