Are you a first-time homebuyer? Don’t be too quick to answer that question, because you might be very surprised to find out that you actually are a first-time homebuyer. The correct answer to this question could actually qualify you for up to $7,500 (interest-free loan) from Uncle Sam.
Before I go any further, let me clearly disclose that I am not an expert tax or financial adviser so after reading this short post you may need to consult a professional tax adviser before proceeding.
Now, are you really a first-time homebuyer? Well according the federal government and the Internal Revenue Service, you qualify as a first-time homebuyer if you meet the following definition:
Taxpayers who owned a main home at any time during the three years prior to the date of purchase are not eligible for the credit. This means that first-time homebuyers and those who have not owned a home in the three years prior to a purchase can qualify for the credit. IRS Website FAQ Link
So, if you (and/or your spouse) have not owned a home during the last three years, then you qualify as a first-time homebuyers and are eligible for the new Tax Credit of up to $7500 if you purchase a home before July 1, 2009. This definition may include many different families who under various circumstances have NOT purchased or owned a home during the past three years. The family may have relocated and have been renting a home for the past three years while deciding where, when and how to purchase a new home. Individuals or families may have gone through some life change circumstances which have prevented them from purchasing or owning a home during the last three years, such as divorce, financial or medical struggles, unstable employment, etc. For these individuals, as well as individuals who have never purchased a home, the new Tax Credit program can offer a substantial financial benefit along with lower-priced homes and lower mortgage interest rates. Please note that in my opening paragraph I referred to the Tax Credit as an “interest-free loan,” because this is money that does have to be paid back to the federal government over the next fifteen years without any interest. (i.e. – $500/year for 15 years = $7500)
Don’t let the words “first-time” cause you to ignore a potentially great opportunity!
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