Woodburn Independent Online

Tax credit ending soon on new homes

Buyers must have a signed deal by April 30 to still get $8,000 credit

• By: Jason Horton  
• Published: 2/16/2010 10:56:26 AM

WOODBURN — Time is running out on the government’s $8,000 tax credit to buy a home. According to Travis Newton, a Keizer mortgage broker with Sunset Mortgage, a signed offer must be complete by April 30 and the deal closed by June 30 in order to get the credit.
 
“If you have a contract date before April 30 and it closes before June 30, you can get up to $8,000 credit and this is for first-time home buyers, which is anyone who hasn’t owned a home in the past three years,” he said.
 
Also, there is up to $6,500 for buyers who have lived in their principle home for five out of the past eight years.
 
“It almost pays for the real estate agents to list it, or helps with some of the lost value because of the market,” Newton said. “But it is a nice incentive for people who own a home, and are looking to buy, to go out and purchase a new home. The nice thing is neither tax credit has to be repaid.”
 
While the $8,000 credit is going away soon, the U.S Department of Agriculture’s (USDA) Rural Loan program is ongoing, and all of Woodburn falls in this category.

“The rural loans are zero-down and are for Woodburn and the outlining areas,” Newton said. “Really, it’s for towns of less than 20,000, but Woodburn was grandfathered in.”
 
The rural loan is not just for first-time home buyers, either, Newton said. The home just has to be in a designated rural area and all of Woodburn falls in that category.
 
“Anyone in Woodburn can get a zero-down loan for anywhere in  Woodburn,” he said. “Obviously, it’s on approved credit, but you just need to have a 620 credit score.”
 
Newton said the time to buy is now because housing prices are extremely low.
 
“It’s a fantastic buyers market. We’re looking at 2006-07 prices on homes and interest rates are still at all-time lows,” he said. “You combine those two things, with this tax credit and a zero-down loan, it makes affording a home much easier for a lot of people.”
 
For more information on any of these loans, contact Newton at 503-931-4490.
 
 
AT A GLANCE: $8,000 first-time home buyer tax credit
 
* The $8,000 tax credit is for first-time home buyers only. For the tax credit program, the IRS defines a first-time home buyer as someone who has not owned a principle residence during the three-year period prior to the purchase.
 
* The tax credit does not have to be repaid.
 
* The tax credit is equal to 10 percent of the home’s purchase price up to a maximum of $8,000.
 
* The tax credit applies only to homes priced at $800,000 or less.
 
* The tax credit now applies to sales occurring on or after Jan. 1, 2009 and on or before April 30. However, in cases where a binding sales contract is signed by April 30, a home purchase completed by June 30 will qualify.
 
* For homes purchased on or after Jan. 1, 2009 and on or before Nov. 6, 2009, the income limits are $75,000 for single taxpayers and $150,000 for married couples filing jointly.
 
* For homes purchased after Nov. 6, 2009 and on or before April 30, single taxpayers with incomes up to $125,000 and married couples with incomes up to $225,000 qualify for the full tax credit.
 
 
AT A GLANCE: The $6,500 move-up/repeat home buyer tax credit
 
* To be eligible to claim the tax credit, buyers must have owned and lived in their previous home for five consecutive years out of the last eight years.
 
* The tax credit does not have to be repaid.
 
* The tax credit is equal to 10 percent of the home’s purchase price up to a maximum of $6,500.
 
* The credit is available for homes purchased after Nov. 6, 2009 and on or before April 30. However, in cases where a binding sales contract is signed by April 30, the home purchase qualifies, provided it is completed by June 30.
 
* Single taxpayers with incomes up to $125,000 and married couples with incomes up to $225,000 qualify for the full tax credit.

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