Courtesy of Stanford Mortgage Josh S Mottashed Loan Consultant There have been many questions that have come my way from both Realtors and clients in regards to the different scenarios that may be presented to determine a clients eligibility for the First Time Homebuyer Tax Credit. I’m writing this to clarify two of the major ones that I’ve been asked. I’ve attached a FAQ from the IRS website that will answer more for your inquiry; however. Q: Can my client file an amended 2008 tax return to acquire their $8000 this year rather than waiting until 2010? Many folks are asking whether or not they can use the funds in lieu of their down payment. The answer is twofold--there is a mortgagee letter out from HUD indicating that you cannot use the funds for down payment. You can use them for closing costs; however the money still has to come from eligible source (ie: friend, family, etc) and then will be paid back after the loan has closed. It really is quite cumbersome to be perfectly honest. What I've been recommending to folks is if they qualify for the tax credit and need the money shortly after close either for reserves, repairs, furniture, etc. to file an amended return and take advantage of the tax credit and funds within the time frame that the IRS processes the return. Per my tax accountant, assuming they file prior to October 15, it’s still electronic and should be within about 2-3 weeks. With that being said, they’ll have up to $8000 in hand prior to their 1st payment of their loan—that’s pretty darn cool!! Some folks have said that if you didn’t purchase a home prior to the April 15 tax filing, that you will have to wait until 2010 filing to acquire your funds—this is not true. Do keep in mind that I’m not presenting myself as a tax advisor, simply quoting or proving information either provided to me by the IRS website or my tax accountant. Q: If my client purchased a home under last year’s law, can they re-qualify if you will under the new expanded law and get back the full $8000 and not have to repay? The answer to this is yes! The government apparently felt the heat on this one after the law changed in the 2008/2009 rollover where not only did some of the eligibility guides change so did the actual credit and repayment plan. The credit as most of you know went from $7500 to $8000 and is now not repayable. Because there was so much heat on this since folks last year have to still repay over 15 years at not interest, they are now allowing folks to file under the $8000 even though they purchased under the old law. I do hope this helps you all. If you should have any questions please feel free to call or email me. Regards, Josh S Mottashed Loan Consultant , Stanford Mortgage Ph: (916) 941-3430 Fx: (916) 933-2975 VFax: (916) 724-3630 joshmottashed@stanfordloans.com View Attachment 2:
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