First Time Home Buyers Get $8000 in NC

March 20, 2009 by 2 Comments

With the new programs adopted by the Government, there’s a great “gift” for First Time Homebuyers!

It’s a G-I-F-T from the Government, and unlike the $7500 credit given out in 2008, you do NOT have to pay it back, as long as you are actually going to live there for 3 years!

This makes getting a mortgage so much better!

Here are some of the details!

  • The $8000 tax credit or 10% of the home’s purchase price, whichever is less, is available only for first time home buyers (Definition of a “first time home buyer” is a buyer who has not owned a principal residence during the three-year period prior to the purchase)
  • There is a $75,000 adjusted gross income limit for tax filers filing as single and $150,000 limit for joint return filers.
  • The $8000 tax credit is available only for primary residence purchases.
  • The tax credit does not require a repayment in most cases.
    • The tax credit does have a repayment provision if the homeowner does not occupy the property for a minimum of 3 years from the closing date.
  • The home buyer must purchase a home between January 1, 2009 and December 1, 2009.  (Remember – this does NOT go through the end of the year!)

The $8000 tax credit is received when you file your tax return.

Frequently Asked Questions:

How do I claim the tax credit? Do I need to complete a form or application?
Participating in the tax credit program is easy. You claim the tax credit on your federal income tax return. Specifically, home buyers should complete IRS Form 5405 to determine their tax credit amount, and then claim this amount on Line 69 of their 1040 income tax return. No other applications or forms are required, and no pre-approval is necessary. However, you will want to be sure that you qualify for the credit under the income limits and first-time home buyer tests.

I read that the tax credit is “refundable.” What does that mean?

The fact that the credit is refundable means that the home buyer credit can be claimed even if the taxpayer has little or no federal income tax liability to offset. Typically this involves the government sending the taxpayer a check for a portion or even all of the amount of the refundable tax credit.

For example, if a qualified home buyer expected, notwithstanding the tax credit, federal income tax liability of $5,000 and had tax withholding of $4,000 for the year, then without the tax credit the taxpayer would owe the IRS $1,000 on April 15th. Suppose now that the taxpayer qualified for the $8,000 home buyer tax credit. As a result, the taxpayer would receive a check for $7,000 ($8,000 minus the $1,000 owed).

For more information on the 2010 Tax Credit click here.

If you have questions about purchasing a home in NC (or refinancing into a lower rate), we would love to help!  Please call Steve and Eleanor Thorne, Mortgage Lenders @ Corporate Investors Mortgage Group, 919-649-5058 x 104

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Va Loans and Co-Borrowers

March 31, 2008 by 7 Comments

va mortgage loans The marriied spouse of a military member or veteran can co-sign a VA loan. WHAT DOES THAT MEAN? In practical terms it means that if you are not married – and the other borrower is NOT a veteran, you will not be able to borrow the maximum allowable VA loan of $417,000.

Again, two unmarried military members are able to co-sign on a VA loan with full benefits. When a military member or veteran wants to bring an unrelated, non-military cosigner, the VA allows this with one major exception.

The VA Mortgage Loan guarantee is limited to the amount of the veteran’s interest in the property. Some companies won’t allow these types of “mixed” loans, so you are likely better off getting an FHA loan!

For more information about qualifying for a VA Mortgage Loan, please click here!

If you have questions about these and other homebuying options – contact Steve and Eleanor Thorne, Government Loan Experts at Corporate Investors Mortgage Group!

Call us at 919-649-5058 – we LOVE working with Veterans!

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Worrying About Your Credit

March 18, 2008 by 1 Comment

fha loansMany new homeowners worry about their credit. They are concerned that with their particular situation, they will never qualify for a home loan.  FHA loans are particularly designed for folks who’ve lived a real life with real life problems that caused “dings” to their credit report.

There are a few myths you should be aware of when you are working to repair your credit:

Myth #1 If a negative item is successfully deleted from my credit report, it will just come right back on my report.

The credit bureaus have cleverly spread this myth through the news media and government agencies. In truth, the credit bureaus will often temporarily delete a negative listing if they have not heard from the credit grantor for 30 days since an item has been disputed. Should the credit grantor submit verification a week or two later, it will be re-inserted. (This is called a soft delete.) Most of the time the creditor simply fails to respond and the negative item is permanently deleted. If the creditor verifies the item the account may still be deleted later in the process as the challenging process is intensified.  (If you have questions about dispute letters click here)

Myth #2: When I pay off a past-due account, such as a charge off or a collection account, it will show “paid” and no longer be negative.It is difficult to fully restore your credit without paying your outstanding debts. However, paying off a debt can actually hurt your credit. Negative items on your credit report are allowed to stay on your credit report for a maximum of seven (7) years, except for bankruptcy that can stay for up to ten (10) years.

his 7 or 10-year clock begins ticking at the date of last activity. Making a payment represents new activity and restarts the clock. When paying an outstanding debt, you will change the account status to paid collection, paid charge-off, satisfied judgment, or paid ‘was xxx days late”. This is still considered very negative and appears as though you had to be strong-armed by the credit bureau to pay the account.

It is almost always prudent to have a professional help so as to not further damage your credit by trying to do the right thing… we counsel people everyday and help them improve their scores!

Myth #3: I can create a totally new credit file by getting a federal tax ID number or changing a few numbers on my social security number. This fraudulent scheme has proven to be complex, difficult and illegal. Lying on a credit application is a criminal offense and with the linking of computer systems it is virtually impossible to get away with. It is in your best interest to face the music by confronting the credit bureaus armed with the rights congress has granted you through the consumer protection laws.

In general – FHA is looking for a credit score of at least 620 and good credit for the last 12 months.  Because Fannie Mae and Freddie Mac recently announced they are going to STOP purchasing loans with credit scores under 640, this may shortly be the bench mark!

If you have questions about qualifying for an FHA loan in Raleigh, Cary, Apex or Holly Springs, contact Steve and Eleanor Thorne, 919-649-5058, we have the BEST RATES in the Triangle!

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