Stimulus Plan Benefits Home Sellers and Buyers in 3 Ways

The Recovery Bill was passed today which includes provisions to benefit home owners and home buyers.

First Time Homebuyer Tax Credit has been amended. The Tax Credit has been increased to $8,000 for homes purchased between 1/1/09 and 12/1/09. Additionally, the credit will not be required to be paid back if the home is purchased between 1/1/09 and 12/1/09 and the buyers remain in the home without selling it for at least 3 years. The credit can be claimed on 2008 taxes with an amended return or on 2009 tax returns. It should be noted that if the home was purchased in 2008 the credit remains $7,500 and it still needs to be paid back over a 15-year time frame beginning in 2011.

FHA Loan Limits will temporarily be reverted back to the 2008 loan limits.
This would mean that the current FHA loan limits for Maricopa county of $271,050 would increase back to $346,250. Effective date for these loan limits is not yet known as Fannie Mae, Freddie Mac and FHA must determine pricing, policy and delivery requirements. We are anticipating a March 1st effective date, but will let you know as more details become available.

Home Improvement Tax Credit has been expanded.
Tax credit for making energy efficient home improvements is now 30% of the cost of the improvements, or a maximum amount of $1,500. Eligible improvements include energy efficient exterior doors and windows, insulation, heat pumps, furnaces, central air conditioners and water heaters.