Brookfield Homes

On Thursday, February 26th, the Franchise Tax Board (FTB) announced that the $10,000 State Income Tax Credit for purchase of a newly constructed home in California would be based on a first come, first served, close of escrow priority. That means the $100 million allocation created by SB 15, will be utilized quickly. Many industry professionals now believe the credit will be exhausted by this summer.

This means that buyers need to act decisively and quickly if they want to take advantage of this stimulus benefit. Please read my earlier posts regarding the California and Federal Tax Credit form more particulars.

The FTB has not yet posted the “certification form” to be used for claiming the tax credit. They believe that form will be posted later today.

The FTB is also creating a report to help home buyers understand how quickly the tax credit is being used. When these tools are posted, I will provide you the links.

Remember, the California State Tax Credit ($10,000) will be applied on a first come, first served, close of escrow basis!

The Federal Housing Administration (FHA) followed Fannie Mae and Freddie Mac and announced they would match loan limits across the United States. That means in San Diego County, the FHA loan limit for a single home purchase is $697,500 and in Riverside County the FHA limit is $500,000.

“February 24, 2009

MORTGAGEE LETTER 2009-07

TO: ALL APPROVED MORTGAGEES

SUBJECT: Loan Limit Increases for FHA

This Mortgagee Letter provides information on Federal Housing Administration (FHA) single family loan limits that have changed as a result of the American Recovery and Reinvestment Act of 2009 (ARRA) signed into law on February 17, 2009. These limits are effective for those loans for which credit is approved in calendar year (CY) 2009 and will remain in effect until December 31, 2009. “

Tax Credits

Did you hear about the new, higher, conforming loan limits?

First, the American Recovery and Reinvestment Act approved an $8,000 Federal Tax Credit for first time homebuyers.

Then, California approved a $10,000 Tax Credit for new home purchases.

Government Money!

Now, we have another benefit from the American Recovery and Reinvestment Act … a return to higher loan limits for Fannie Mae and Freddie Mac! The new loan limit amounts are going back to the 2008 levels. That means up to $697,500 for a home buyer in San Diego County and up to $500,000 in Riverside County. These new loan limits apply to all conforming loans originated in 2009! Match that new loan limit up with fantastic pricing, historically low interest rates and your buying power today is stronger than ever!

Then to sweeten the pot, California will give you a $10,000 tax credit for the purchase of a new home and the Federal Government will give you an $8,000 tax credit (subject to certain limitations and time frames.)

See your Brookfield Homes Sales Professional for more details. Let us try to match you up with the right home and the right deal.

$10,000 Tax Credit for Californians

Did you hear about the California $10,000 Tax Credit for the purchase of a newly constructed home? 

The Legislature for State of California passed a revised budget plan today. Governor Schwarzenegger has promised to sign the historic legislation tomorrow. Included in this new budget is a $10,000 Tax Credit for the purchasers of a newly constructed home in the State of California.  The bill is called SB 15. There are conditions to receive this Tax Credit, some of which are still being worked out. Let me tell you what we do know at this time:

1. The Tax Credit is good for 5% of the value of the newly constructed home, up to $10,000. (That would mean any home priced over $200,000 would qualify for the full credit.)

2. The Tax Credit will be available between March 1, 2009 and March 1, 2010, or when the funding authority runs out. (The Legislature has earmarked $100 million for this credit. That mean at least 10,000 new home sales. We don’t know yet if the Tax Credit will be based on when the contract for sale is written or when the escrow is closed for the purchase.)

3. The Tax Credit will be allocated by the Franchise Tax Board and will be available to new home buyers over a three year period. (Roughly one third of the Tax Credit will be available each year, details here are still being worked out.)

4. The new home purchaser must live in the home for at least two years.

5. There are no income limitations for the purchaser.

6. There is no “first time buyer” restriction.

7. There is no repayment requirement (unless the purchaser sells or rents out the home before two years have past from the close of escrow).

This is great news for California home buyers! And, if the home buyer also qualifies for the $8,000 Federal Tax Credit (see my post from February 18, 2009), then the total Tax Credit for buying a newly constructed home would be $18,000! That is $10,000 from the State of California and $8,000 from the Federal Government. Stay tuned for more details.

California Housing Tax Credit

Now, go visit a Brookfield Homes community and talk to our professional sales staff. They will be able to help you with your buying decisions and get you a great deal on a new Brookfield home!

The new Stimulus Bill provides for an $8,000 Federal Tax Credit! Are you eligible?

President Barak Obama signed into law yesterday H.R. 1, The American Recovery and Reinvestment Act of 2009. As part of the new law, first time home buyers will be provided up to an $8,000 tax credit. The credit will be available to those home purchasers that close escrow on a home between January 1, 2009 and December 1, 2009.

This is a true credit, refundable to those taxpayers that have less than $8,000 in tax liability. That means the IRS will give you $8,000 to help pay your taxes in 2009, for buying a home in 2009. If you owe the IRS $9,000 for your 2009 taxes, you will only have to send them $1,000. If you owe the IRS $2,000 for your 2009 taxes, the IRS will send you $6,000, if you buy a home in 2009. What a great deal! There are some restrictions that home buyers should be aware of:

1. The credit can not be used as part of your down payment and you still have to qualify for a loan.

2. There are income limitations for the purchasers, $75,000 for an individual or $150,000 for a couple. Partial credits may be available if you exceed the maximum income limits.

3. The Tax credit is for 10% of the home’s value, up to $8,000. And, it may be used to buy a new, resale or foreclosed home.

4. You must be a first time home buyer. By definition, this means you (and your spouse, if buying jointly) must not have been a home owner for the past 3 years.

There are other provisions in the American Recovery and Investment Act of 2009 that home buyers might want to be aware of:

1. The new law extends the higher Fannie Mae and Freddie Mac conforming loan rates from 2008 thru December 31, 2009, check with your lender for specifics of loan limits in your area.

2. Extends tax credits for energy efficiency home improvements.

3. Provides a “patch” for the Alternative Minimum Tax rules for 2009.

More information will become available over the next couple of weeks. Watch this blog for future updates. Until then, good luck and good shopping for that new home!