Today, our very own Springfield Real Estate Market was featured in the USA Today. In an article written by Christine Dugas, “the Springfield, MA Home Market Sees an Upswing.” In October, the median home price is $133,500, up 5.9% from a year ago. Also, October, 2009 saw home sales 20.5% higher than the same month last year. Click below to read the full article.

http://www.usatoday.com/money/economy/housing/closetohome/2009-12-01-closetohome01_ST_N.htm

The National Association of Realtors® (NAR) has created a Tax Credit Comparison Chart to help homebuyers better understand the recent changes to the Home Buyer Tax Credit. Click below to view the comparison chart and feel free to contact us with any questions.

2009 NAR Changes Chart

The Home Buyer Tax Credit Extended and Expanded until April, 2010, read more here.

• Extends the First-Time Home Buyer Tax Credit of up to $8,000 to first-time home buyers until April 30, 2010.
• Expands the credit to grant up to $6,500 credit to current home owners purchasing a new or existing home between November 7, 2009 and April 30, 2010.

The following FAQ should answer all of your questions:

Question: Existing homeowner credit: Must the new house cost more than the old house?
Answer: No. Thus, for example, individuals who move from a high cost area to a lower cost area who meet all eligibility requirements will qualify for the $6500 credit.

Question: I am an existing homeowner. On October 25, 2009, I signed a contract to purchase a new home. I have lived in my current home for more than 5 consecutive years andam within the new income limits. I will go to settlement on November 20. If President Obama has signed the bill by the time I go to settlement, will I qualify forthe new $6500 tax credit?
Answer: Yes. The existing homeowner credit goes into effect for purchases after the date of enactment (when the bill is signed). There is no reference to the date of contract for the new credit. The provision looks solely to the date of purchase, which is generally the date of settlement.

Question: I am a first time homebuyer but was not within the prior income limits at the time I entered into my contract to purchase on October 30, 2009. I will be covered, however, by the new income limits. If the new rules have been signed into law by the time I go to settlement, will I be eligible for a credit?
Answer: Yes. The new income limitations go into effect as soon as the President has signed the bill.The income limit and other eligibility rules will look to your status as of the date of purchase,which is the settlement date. So if the new rules have been signed when you go to settlement, you should be eligible for the credit (or a portion of the credit if you're within the phase out range).

Question: I am an eligible existing homeowner. I have a fair amount of equity in my home. I have found a home with a non negotiable price of $825,000. Will I be able to use anyof the $6500 tax credit?
Answer: No. The $800,000 cap on the cost of the purchased home is firm at $800,000. Any amount above $800,000 makes the home ineligible for any portion of the credit. The $800,000 is anabsolute ceiling.

Question: I owned my home for 10 years, but sold it two years ago year and have been renting since. If I purchase a home, will I be eligible for the $6500 tax credit if I meet all the other eligibility tests?
Answer: Yes. Because you lived in the home for more than 5 consecutive years of the previous 8, youwill qualify for the $6500 credit. For example, Say John and his wife bought a home in 2000 and lived there until 2008 when he got a divorce. Whether John has been renting or bought in the interim, he WOULD INDEED be eligible for the credit because he owned a home and occupied it as his principal residence for 5 consecutive years out of the last 8 years. The keyword here is "consecutive." As long as he lived in that house for 5 years straight what he did since 3 years doesn't impact eligibility.

Question: I am an eligible first time homebuyer. I entered into a contract to purchase on November 1, 2009. Do I have to go to closing before December 1? How does the extension date affect me?
Answer:You do not have to close before December 1. Once the legislation has been signed, it will be as if the Nov 30 date had never existed. Therefore, so long as the contract settles before April 30(or July 1, worst case), the purchaser will be eligible for the credit

FHA loans are the easiest type of real estate mortgage loan to qualify for. The FHA guidelines for loan qualification are the most flexible of all mortgage loans that require less than 5% down payment.

Following is the basic FHA loan qualification guidelines.

• Two Years of steady employment, preferably with same employer.
• Last two years Income should be the same or increasing.
• Credit report should typically have less than two thirty day lates in last two years with a minimum credit score of 620 or higher or in some cases no credit score at all.
• Bankruptcy's must be at least two years old, with perfect credit since discharge.
• Foreclosure's must be at least three years old, with perfect credit since.
• Your new mortgage payment should be approximately 30% of your gross (before taxes) income.

These are some of the most basic of FHA guidelines for qualifying for a FHA loan. If you have answered yes to most of these statements, you probably qualify for a FHA mortgage loan.

Just a reminder for all of you first time homebuyers – please keep in mind that the government’s First-Time Home Buyer Tax Credit program expires November 30, 2009.

It can take up to 6 weeks to close on a home, so you may only have 2 weeks, at best to find a home. Specifically, if you are not under contract by October 16th, you may have little chance of meeting that deadline.

The clock is ticking. If you’re planning to use the First-Time Home Buyer Tax Credit, the time to act is now. Call us today to set up showings to find your home before it is too late.

This is a fun and easy-to-understand web video that provides a short description of the first time homebuyer credit.




Visit our Buyer’s section to get additional information on the first time homebuyers tax credit as well as a search tool to find your next home.