In the annual holiday special, Charlie Brown asks Lucy what she wants for Christmas

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According to reports on CNBC, president Obama signed a bill today to extend the current $8,000 tax credit
to first time home buyers and includes a $6,500 tax credit to exsisting home owners purchasing a home.  

Senate lawmakers struck an agreement to not only push back the measure’s looming deadline but expand it to allow current homeowners and more affluent buyers to claim the credit. “We welcome efforts taken by Congress to extend the first-time home buyers tax credit for a limited period,” Treasury Secretary Tim Geithner and HUD Secretary Shaun Donovan said in a joint statement today. “This credit has brought new families into the housing market and contributed to three consecutive months of rising home prices nationwide.

Although various proposals to extend and expand the credit have circulated in Congress for weeks, Senate lawmakers finally reached a deal in recent days. Under the terms of the agreement, the deadline for first-time home buyers to claim the $8,000 credit would be pushed back to April 30, 2010. But the term “deadline” doesn’t mean the same thing as it does in the current credit. The Senate agreement stipulates that buyers must have a sales contract on a house by April 30 to be eligible, but it gives them an additional 60 days to close the purchase. That’s much different from the current credit, in which transactions must be closed by November 30. Looked at one way, the effective deadline of the credit under this agreement is actually the end of June.

But perhaps the most significant change is that current homeowners would become eligible for the tax perk as well. The current credit prevents home buyers who have owned a primary residence within the past three years from claiming the credit. The agreement, however, would allow current homeowners to claim up to $6,500 as long as the property they are vacating has been their primary residence for at least five years. Expanding the credit beyond first-time buyers is intended to boost home sales to “move up” buyers–those moving from one house to another–which some lawmakers, most notably Georgia Republican Sen. Johnny Isakson, argue is essential to a housing recovery.

The agreement also enables more affluent Americans to claim the tax credit. Senators moved to increase its annual income limits from $75,000 to $125,000 for single buyers and from $150,000 to $225,000 for married couples. These limits apply to both first-time and move-up buyers, although neither can purchase a home for more than $800,000 and still get the credit. Anyone taking the credit on a 2010 purchase can claim it on his or her 2009 tax return. And as long as home buyers live in the property they purchased via the credit for three years or more, the tax credit does not have to be repaid.

Too many people bought too much house for too many years. Yes, the financial system almost collapsed because mortgage bankers and brokers told lies about loan terms and loosened standards in dangerous ways, and investment bankers packaged those loans into bonds that were far more toxic than ratings agencies predicted.

But the roots of the mortgage contagion lie with all of us and our desire to own just a bit more house.

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Tom Keyes

Edina Realty

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Top 10 Red Flags for Homebuyers. Sellers don’t always disclose the whole truth to potential homebuyers, especially if they’re eager to sell. http://bit.ly/MvJGx

Tom Keyes

Edina Realty

Contact me

First Time Home Buyers — Take Note!!

There has not been a time in decades where the time has been  more right to purchase your first home:

• Interest rates are the lowest we’ve seen in years
• Home prices are still affordable (although starting to rise a bit this month)
• There is a good supply of entry-level homes available on the market
• The FHA is still offering loans for as little as 3.5% down

Now is the time!!

For more information about purchasing your home, or why now is the right time to do so, visit us online at:  www.HomeBuyerEducationTeam.com