Mardi Boettcher's Blog

Many of you have had questions about the new Tax Credit Laws, so I thought it would be helpful to post these links to two excellent Q & A documents for you from http://www.federalhousingtaxcredit.com/

Be sure you check with your tax professional before making any final decisions.

Enjoy!

Click here for a list of frequently asked questions.

Click here for information specifically about the eligibility requirements for existing homeowners.

Here is the great news we’ve all been hoping for!  Following the Senate’s favorable vote yesterday, the U.S. House of Representatives just voted 403 to 12 to extend the homebuyer tax credit, expanding the parameters to include existing homeowners and not just first-time buyers.  The California Association of Realtors (C.A.R) and the National Association of Realtors (N.A.R.) have worked for months urging Congress and the Senate to extend and expand this crucial piece of legislation.  We expect President Obama to sign the legislation in short order.

As it now stands, the federal tax credit will be extended through April 30, 2010, with a 60-day extension if a binding contract is in place prior to the deadline.  First-time homebuyers will continue to be eligible for a tax credit of up to $8,000, while existing homeowners will be eligible for a reduced credit of up to $6,500.  To qualify for the $6,500 credit, existing homeowners must have lived in their current residences for at least five years.  The bill also increases the qualifying income limits from $75,000 for single tax filers and $150,000 for joint filers to $125,000 and $225,000, respectively.  The purchase price of the home is capped at $800,000 in both instances.

Under additional provisions included in the bill, taxpayers can claim the credit on purchases completed in 2010 on their 2009 income tax returns.  The legislation maintains the provision that homebuyers do not have to repay the credit provided the home remains their primary residence for 36 months after purchase, and waives this requirement for active duty military personnel who move due to a military order.

Nationwide, more than 1.4 million first-time homebuyers were given the opportunity to become homeowners as a result of the Federal Tax Credit for First-time Home Buyers.  We expect that number to increase dramatically in the months ahead with this new legislation in place.  Thank you to my fellow members of C.A.R. and N.A.R.  We called, wrote, and e-mailed our congressional representatives and voiced our support for the homebuyer tax credit.  Our voices were heard and today’s vote is a direct result of our actions and involvement.

I have heard that U.S. Senate leaders might have moved closer to an agreement about replacing the expiring $8,000 tax credit for first-time homebuyers with a smaller one that expands access to more borrowers.  The existing credit is due to end Nov. 30.

 The proposed legislation would reduce the size of the tax credit to 10 percent of the sale’s price and cap it $7,290.  This tax credit would be available on home purchases that would go into contract by April 30th, and borrowers would have an additional 60 days to close the sale.

 The new agreement, if passed, would expand the credit to “step-up” borrowers who have lived in their current home for at least five years.  The income eligibility for first-time homebuyers would remain the same at $75,000 for individuals and $150,000 for couples.  The income criteria for step-up buyers would be $125,000 for individuals and $250,000 for couples.  The credit would be limited to homes costing $800,000 or less.

I think this is a great plan and believe it will relieve the current gridlock in the middle price range market.  Keep your fingers crossed!

With housing prices down, mortgage rates at a 30-year low and foreclosures soaring, you have plenty of incentives to jump into the real estate market.  

“Time is of the essence”  right now because the $8,000 tax credit stimulus expires at midnight, Nov 30, 2009.  In order to be sure you make the deadline, you need to be in escrow by October 1, 2009.  So get your pre-approval letter and select your home ASAP.

While foreclosures can offer you big discounts, many bank-owned properties require substantial repairs.  You will need to know what you are getting into and I can guide you safely through the search and buying process.

For a free list of foreclosed properties go to www.bankownedweekly.com/mendocino

People are always asking me how the market is doing, and for quite some time, I’ve been saying that I think we have hit bottom and that the market is headed back up.  The news media (who unwittingly control the economy) have reported positive gains, but often the national statistics do not apply to our local area.  Here are the latest and greatest stats from my California Association and it is truly good news. 

It’s also interesting to note that the Tax Credit has fueled the rally with a whopping 40% of buyers who said they wouldn’t have bought without it.  There is talk of extending the deadline beyond the Dec 1^st deadline, but with the national debt skyrocketing, I think it may not happen.  If you want to take advantage of it, you had better be in contract by October 15^th to ensure you can close in time.  Loan underwriters are slammed and approvals are taking up to an extra two weeks.

I’ve highlighted the main points for you, in case you are in a hurry.

Home sales increased 12 percent in July in California compared with the same period a year ago, while the median price of an existing home declined 19.6 percent, C.A.R. reported yesterday.  “The federal tax credit for first-time buyers played a critical role in the purchase decision of many buyers,” said C.A.R. President James Liptak.  “Nearly 40 percent of first-time buyers said they would not have purchased a home if the tax credit was not offered.  Because the tax credit has helped so many first-time buyers become homeowners, it is critical that Congress extends the credit beyond the Dec. 1 deadline, and includes all buyers, not just first-timers.”

Closed escrow sales of existing, single-family detached homes in California totaled 553,910 in July at a seasonally adjusted annualized rate.  Statewide home resale activity increased 12 percent from the revised 494,390 sales pace recorded in July 2008.  Sales in July 2009 increased 8.1 percent compared with the previous month.  The statewide sales figure represents what the total number of homes sold during 2009 would be if sales maintained the July pace throughout the year.  It is adjusted to account for seasonal factors that typically influence home sales.

The median price of an existing, single-family detached home in California during July 2009 was $285,480, a 19.6 percent decrease from the revised $355,000 median for July 2008, C.A.R. reported.  The July 2009 median price rose 3.9 percent compared with June’s $274,740 median price.

“July marked the fifth consecutive month of month-to-month increases in the median price,” said C.A.R. Vice President and Chief Economist Leslie Appleton-Young.  “This was the largest increase on record for the month of July based on statistics dating back to 1979.  The yearly decline in July also was the smallest in the past 19 months.”

Get Up To $8000 in Free Money From The Federal Government To Buy A Home In 2009

You get 10% of the value of the home you purchase, up to a maximum of $8000

In order to claim your $8000 – you must:

1. Have not owned a home in the last 3 years.

2. Make less than $75,000 as a single tax filer — or less than

$150,000 as a couple.

3. Buy a home before November 30th, 2009.

To get a FREE Tax Credit Guide, just call 1-888-275-5165 x 302 for a

24 hr. Recorded Message — or go to www.TaxCreditGuide.com

Now you may have a big incentive to “Go Green.”  There is a new 2009 law that gives you uncapped and unlimited tax credits for installing qualified solar, wind, or geothermal energy improvements in your home, or other residence.  For each 2009  dollar you spend, you earn a 30 percent tax credit and there is no limit on the credit.  You have plenty of time too, because the credit does not expire until December 31, 2016!  Tax credits are the best because they reduce your taxes dollar for dollar.  See your CPA for all the details.

I just received an excellent e-newsletter from my Loan Consultant and Team Member, Ginny Richards.

It has a great article about The Benefits of the Stimulus Package, The Tax Deduction Benefits of Home Ownership, How to Help Aging Parents with Their Finances, and Great Deals on College Education For Your Kids.  If you would like me to forward it to you, just send me an email, mardi@ukiahvalleyhomes.com

Have you received a letter in the mail regarding a reduction in your property taxes for a fee?   This is a solicitation from a private company that is not affiliated with any government agency.  If you believe that your property value has declined and that your property may qualify for a reassessment, contact your County Assessor’s office.  All review of assessed values are FREE through the county.