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Friday, October 23, 2009

Real Estate Loans: First Time Home Buyers Tax Credit

Dean C. Piller by GRI Instructor Dean C. Piller
Teaches GRI Course 109 - Residential Real Estate Finance, West Los Angeles College Instructor, Mortgage Broker
View future classes taught by Dean C. Piller

Congress is considering extending the $8,000 tax credit to first time home-buyers (those that have not owned a home in the last 3 years), which is scheduled to expire November 30, 2009. At least 20% of the homes sold nationwide were a direct cause of the buyers getting this tax credit. If Congress does not extend the credit, it will be crippling for housing and the economy.

Some members of Congress are pushing to expand the credit from $8,000 to $15,000, and lift the income restrictions that are currently in place. Currently the first-time homebuyer credit is available in full to those buying their primary residences that make $75,000 or less ($150,000 for those who file jointly). A partial credit is available to those making between $75,000 and $95,000 ($150,000 to $170,000 for joint filers).

Foreclosures are still on the rise and so is unemployment. To stabilize the economy, we need to keep the housing market strong and steady. Real estate led us into this recession and will be a major factor in pulling us out. Job growth is always the last sector to recover, and it will come in time. Momentum is the key here. Real estate growth, small business growth, lower taxes and overhead will lead the way. As businesses grow, they will need more employees to staff their companies, and we will get America back to work and on the road to prosperity.

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