The good news is that it would be available to qualified first-time home buyers with an up-to-$8,000 tax credit until April 30, 2010.  Buyers would need to sign a sales agreement by the end of April and close on their home by June 30, 2010.

Another version of the legislation circulating suggests a full $8,000 available in quarter 1 of 2010, $6,000 in Q2, $4,000 in Q3 and $2,000 in Q4 with the credit expiring December 31, 2010.

But, it also offers a reduced credit of up to $6,500 to repeat buyers who have owned their current homes for at least five years.  This opens up a credit to buyers to a new segment that hasn’t been enticed to enter the housing market with federal incentives yet.

As more details emerge or the final version becomes law, we’ll keep you posted.  Let us know what you think the tax credit extension can do in your market for your business.

Yesterday the U. S. Department of Housing (HUD) issued a press release clarifying the status of the up to $8,000 federal tax credit in use with Federal Housing Administration (FHA) loans.

Here are some of the new guidelines for homeowners using the $8,000 tax credit:

• State Housing Finance Agencies and certain non-profits can "monetize" the tax credit up to the full amount of the tax credit (depending on the amount of the mortgage) to allow borrowers to immediately (rather than waiting for their federal tax refund check) apply the funds toward their down payments.

• Buyers financing through these state and non-profit organizations will be able to use the tax credit for their down payments via a short-term loan provided by the HFA or non-profit. In addition to the borrower’s own cash investment, FHA allows parents, employers and other governmental entities to contribute towards the down payment. (Remember that individuals can gift up to $13,000 per person per year tax-free.)

• Home buyers using FHA-approved lenders can apply the tax credit to their down payment in excess of 3.5% of appraised value or their closing costs, which can help buyers achieve a lower interest rate. Buyers cannot use the tax credit amount as part of their 3.5% down payment, but can use any or all of the funds as additional down payment.

In light of these changes, what does this mean for the first-time buyers you are working with? The news is brand new – have you told them yet through your many marketing methods?

In addition, the National Association of Home Builders predicts that the tax credit will fuel 160,000 home sales in the U. S. What portion of the 160K homes that are sold by November 30 will you have a part in?

Remember the date: the first time home buyer tax credit applies to purchases closed/settled on or before November 30, 2009. Don’t lose the opportunity to inform your buyers and get their business before time runs out for this federal tax credit.

However, do you know the exact details of what the income limits are for the different packages, the dates that the offers go into effect (and end), caps or limitations on the tax credits or if the program is being run by the federal government or a state agency or something else altogether? Because the news articles we tend to see don’t give us the nitty gritty details that determine whether or not home buyers and sellers (your clients) will qualify for a program, you need to go to the original source.

In this case, Thomas.gov comes in quite handy. (Back in 1995, Congress directed the Library of Congress to make legislation (and pending legislation) easily accessible by the public. It’s a great resource to learn what actual legislation says and learn about what bills are pending in the House and Senate.)

So, if you’re interested in learning which of your first-time homebuyers can qualify for an up to $8,000 tax credit and how homesellers can get a rebate when they purchase energy-efficient appliances and a tax credit for energy-efficient home improvements turn to Thomas.gov. Right now the link to the stimulus bill is on the front page of the website , but searching on “American Recovery and Reinvestment Act of 2009” will allow you to find the document in the future.

And for a quick read to see the Senate version, the House version and the Conference agreement (final agreed upon wording):

First-time homebuyer tax credit, “Extension of and increase in first-time homebuyer credit; waiver of requirement to repay.” (Currently page 16-18.)

Homeowners improvements that qualify for a tax credit, “Credit for investment in advanced energy property.” (Currently page 139-142.)

Be sure to get the details of this legislation out to your clients.