New Information For First-Time Homebuyers

I have gathered together information on the Housing and Economic Recovery Act signed into law in July of 2008.  A first-time homebuyer is anyone who has not owned a home in the past three years. If two people are purchasing together neither can have owned a home in the last three years.

Tax Credit

The Tax Credit pertains to homes that are purchased between April 9, 2008 and July 1, 2009.  The tax credit is an interest free loan of 10% of the property value, with a maximum of $7500.  The loan is to be paid back in 15 yearly installments of 6.67% of the credit amount ($502.50 per year) starting the following year.  This credit is a refundable credit which means it is tied to your income tax return.  For example, if the buyer owes $4500 in taxes, he will receive a refund of $3000; if he has paid withholding taxes over and above his tax liability, he will receive his allotted refund plus the $7500.

The refund is income driven.  Income limits to qualify for the full $7500  credit are maxed out at $75,000 for individuals and $150,000 for married couples.  Higher incomes receive a reduced credit.  People with incomes at or above $95,000 individually or $170,000 for couples receive no tax credit.  If you have questions regarding this, I would advise you to contact your accountant.

Loan Limit Updates

Conforming loan limits, including FHA have been raised from $417,000 to a maximum of $625,500 for high-cost areas.

Minimum Downpayment

The minimum downpayment required has been raised from 3% to 3-1/2%.  With FHA this can be a gift.

Downpayment Assistance Programs

As of October 1, 2008 all downpayment assistance programs such as AmeriDream and Nehemiah will no longer be available although sellers will still be able to pay up to 6% for closing costs.

Bottom Line

There are many homes for sale at great prices.  If you want to purchase a home, get pre-approved now and find a home you love!  Give me a call at 630-664-9472 for the names of some great loan officers if you are not already pre-approved and let's see those homes! 

You may be surprised to learn that there are 217 single family homes for sale in DuPage County priced at $200,000 or lower and that there are 505 single family homes in Will County priced at $200,000 or lower. Other choices are condos, townhomes, half-duplexes, etc. Some of these come with very low or no assessments.

Now you may be wondering where the downpayment and closing costs will come from. If you have money invested in the stock market and are disappointed with how those stocks are performing, you might want to consider selling some of those stocks.

Just cutting down on fancy coffees can save a bunch of money. Try some FREE musical entertainment on Friday nights from 7-9 pm in Naperville next to the Riverwalk Eatery. Here's the schedule: June 27 - Karma (70s & 80s rock/classic rock; July 11 - The Cattails (Americana); July 18 - Ron Hayden (solo guitarist); July 25 - Fifth Avenue Band (variety); Aug. 1 - The Blues Shakers (blues); Aug. 8 - The Gecko Club (80s post punk).

There are also programs such as Ameridream.

Give me a call at 630-664-9472 or email mariannehofmann@att.net if you have any questions or if I can be of service to you.

Buying A Home, Selling A Home

Whether you are going to buy a home or sell a home, you should receive my real estate newsletter.

Here's Why:

• It comes out only once a month. You will not be bombarded with email.
• You will find valuable information no matter if you are a first time buyer, seasoned buyer or a home seller.
• You will receive items of value from Lowe's Home Improvement Centers including coupons.

Simply send your name and address to mariannehofmann@att.net.

Buying A Home, Selling A Home

Probably the most important quality your real estate agent must have is being a full-time Realtor.  Ask your agent if they have another job.  You want to know that when you call your agent he or she can devote their full attention to you.  You do not want to hear "Can I call you back in a minute?"", knowing that it will be hours before you hear from them.  This can be crucial when negotiating a contract.  If the buyer's agent doesn't stay on top of things, the seller can be looking at another contract that came in while the first buyer was waiting to hear back from his Realtor.  So, the buyer could very well lose the house he or she fell in love with.

You will want to have a home inspection and perhaps other inspections such as radon, lead paint, etc.  You will want your agent to be able to attend the inspections, especially if by some chance, you cannot.  Your agent must talk with you and your attorney about what you want to do about any issues that come up in the inspections and this has to be done in a certain time-frame otherwise you will have no recourse as far as having any repairs, etc., done to the home.

Another reason that you want a full-time Realtor is that whether buying or selling, there is going to be a lot of communication going on with your attorney by phone and fax and they usually work from 9-5, Mondays through Friday.

Before hiring a Realtor, ask for some testimonials.  This will give you a great deal of information about the Realtor, how hard they work, what they know about negotiating and will they go above and beyond to ensure that you have a successful sale or purchase of a home.  If you have any questions, please give me a call at 630-664-9472 or e-mail: mariannehofmann@att.net.  I'd love to hear from you!