$7500 First Time Homebuyer Tax Credit

Last night, a reader named Heather asked the following question:

We are debating about whether or not to take the $7500 from the government for being first time home owners. In 2 years, we will have to start paying “them” back $500 for the next 15 years. If we were to sell our house in that time and not make a profit, the debt would be forgiven. I’m not sure I want to owe anyone anything, but hubby thinks of it as an interest free loan… What’s your take on this?

Oddly enough, I was in the process of writing about the first time homebuyer credit when her question rolled in. Weird. Anyway…

The First Time Homebuyer Tax Credit

When it was first proposed in the “Housing Rescue Bill, ” the first time homebuyer tax credit was, as Heather noted, little more than an interest free loan (more on this below).

According to IRS guidance, the credit:

  • Applies to homes purchased after April 8, 2008 and before July 1, 2009
  • Reduced a taxpayer’s tax bill or increases their refund dollar-for-dollar
  • Is fully refundable, meaning that you can get it even if you owe not taxes

The amount of the credit is 10% of the purchase price of the home in question, up to a maximum of $7, 500 for single taxpayers, or married couples filing jointly. There are, however, a couple of catches…

For starters, the credit is phased out based on your modified adjusted gross income (MAGI). For married couples filing jointly, the credit phases out between $150k-$170k. For all others, the phase out range is $75k-$95k.

The other problem is that it’s not really a credit. Rather, this “credit” has to be paid back in equal installments over the next 15 years along with your taxes. Not such a great credit anymore, huh?

That’s the bad news. The good news is that changes may be afoot…

Conversion to a True Credit?

House Democrats recently outlined their $835 billion economic stimulus package, and one of the things that they’re hoping to do is make the homebuyer tax credit a true credit — with no repayment necessary. Of course, this is still subject to negotiations between the House and Senate, and to passage of the economic stimulus package itself, but…

If it happens, buyers who qualified for the credit in 2008, or those who do so in 2009, will be relieved of the repayment requirement. Is this enough to make you go out and buy a house? Probably not. But if you’re buying one anyway, be sure to take advantage.

Update: The Senate just passed an amendment to the stimulus bill that would create a $15, 000 tax credit with no repayment requirement. Moreover, it would be available to all purchasers, not just first-time homebuyers.

144 Responses to “$7500 First Time Homebuyer Tax Credit”

  1. Anonymous

    Does anyone know the deal with the 7500 credit. I have been repaying every year but I wanted to get info on maybe a way that I should get the 7500 as a full credit rather than a loan. Its definitely not fair that I have to pay this back I bought in dec 08. One more month and I would have gotten the 8000. Lets fight this loan it should be changed from a loan to a credit. Come on one more month and I would have gotten 8 with no payback. Write the congres house even the pres and lets make it equal now. And the guys who don’t get the credit it doesnt hurt to write a letter either your kids might be affected by this injustice.

  2. Anonymous

    Well, at least you can sell for a loss and then not have to pay it back. Which, if you bought in ’08 and are selling now, chances are you will be selling for a loss. You will have to treat it as income and be taxed on it, because forgiveness of a loan is treated as income!

  3. Anonymous

    there something i dont understand here why do you have to repay if you bought in 2008 and dont have to in 2009 damn…. i bought in 2008 i dont think thats fair..

  4. Anonymous

    Hi, just wondering if anyone has started a petition or writing letters to Senators and Congressmen about the repayment of the $7500 yet? Is there another website I can go to?

  5. Anonymous

    still confused about the updates. I was told that the 7500 no longer needed to be repaid due to the fact that the following year the homebuyers incentive was increased to 8000.00 with no payback. is this true or have I been mislead……???????thanks for your comments and time

  6. Anonymous

    Can anyone answer this question about the tax credit? We bought our house from my wife’s parents in May 2009. At this time the IRS didn’t specifically say you weren’t eligible for the credit if you buy a house from family. This rule was added more recently to combat fraud. If we can prove that we paid fair market value determined by two appraisals, can we still file for the credit?
    Thanks for any help.

  7. Anonymous

    The gov really trapped a lot of folks into thinking this is the answer. notice theyve done nothing for the millions of americans who are suffering from this. They are only trying to help the ones who havnt een trapped by this financial fiasco, and as we can see, those who are qualifying for this credit arent doing any better. y cant the govt just wipe out everyones debt and staft from scratch. that will boost the economy cause we will go get ourselves right back in a hole

  8. Anonymous

    Kid..I am not negative.

    There is nothing wrong with having the viewpoint that is different than yours…

    You were fortunate enough to recieve a $7500 interest free 15 year loan from Uncle Sam. I simply disagree that you are owed money because a change was made to a program AFTER you participated in it. Why is that so tough for you to accept. This website is dedicated to discussing the issue, not supporting your viewpoint.

    BTW – I have a wonderful wife, a daughter, two dogs, and a beautiful home that I work very hard to pay for.

  9. Anonymous

    maybe not forced but rushed is a better word….what is your problem man….i am trying to work with others to try to write letters and follow the process so that this may be changed…you are negative and perhaps need to find a more relevant blog for your rude behavior…Again I state the program should be a fair one and i do not believe it was…looking for peeps to write to their congress people to try to make a change that is all…Jason you need a pet or a girlfriend or something…..sorry you are having a bad day or life or whatever……

  10. Anonymous

    You bought a house because you “kinda felt forced by the realtors and the bank and the gov”, and you are calling me ignorant…LMAO

    What is so ignorant about understanding that “fair” has nothing to do with these tax credits…nor should it! No one owes you anything!!!

  11. Anonymous

    Jason….walk a mile in our shoes then spout off your ignorant comments..i was hoping to find others here to appeal to the legislature to make this a fair program…start to finish

  12. Anonymous

    Yea … well I kinda felt forced by the realtors and the bank and the gov to get in …. to get this great deal….so I equate it to a trusting relationship….i shook hands and now feel cheated…. say what you want but it is just a form of discrimination I feel

  13. Anonymous

    I guess my point is the tax credit is not meant to be “fair”. It is intended to stimulate consumption. The credit you recieved stimulated your consumption. It took altering the credit to get more folks to buy.

    Imagine if someone who closed in March of ’08 decided that they to “deserved” some incentive. Or even those who bought their house in ’05 and have since lost half of the value…maybe they should get a check too?

    Well I have to go now…gas prices are down 10 cents from when I filled up yesterday. I am going to ask the attendant for a refund…I deserved to pay the lower price!

  14. Anonymous

    So you just sit back and do nothing? seems real productive! If nobody at least tries to speak up, then you can bet they will do nothing. If everyone spoke up more often for what they belive in, then just maybe you will be heard and things will change. Sitting back and just letting everything fly is a horrible way to be and an awful attitude. Nothing gets done if you don’t do something about it. this is at least a start and about the only thing you can do, so quit being such a lazy debbie downer and attempt to make some difference in this world, you might just suprise yourself.

  15. Anonymous

    I agree Paul, we also took advantage of this “credit” when it came out in 2008 thinking how ‘great’ this was and that we were lucky enough to just happen to have closed on our house just past the April 9th deadline. All the hype was that you should take advantage of this, it’s not going to last, you are sooo lucky to qualify for it, bla bla bla! So we thought heck yeah, jump on board, it’s not very often the government gives away basically an interest free loan! well little did we know they would not only extend it BUT ALSO make it so these new lucky people did NOT have to pay it back, unlike us. Then on top of it, they have also made the credit for more and available to more people. Ummm, hello? why is there nothing in there to revise it so us people who took advantage of this in 2008 to no longer have to pay it back???? I’m beyond furious they did this and have now made it clearly unfair to us suckers who trusted it the first go around! Makes me see just how ‘fair’ our government is… What you should do is write to all of your state representitives and tell them exactly what you think about all of this and tell them how unfair this is! I have already done this in hopes that maybe enough fuss will get them to really look at this and change it. So far I’ve gotten one letter back, basically it didnt say a whole lot other than the whole bill is back into the ways and means committe for re-vision, so fingers crossed that it is about this issue! sigh…sure makes you have all kinds of trust and faith in our fine ol’ government, eh? lmao!!

  16. Anonymous

    I purchased in Sept of 2008. I am a single dad and get no support from ex. Kids and I have not found one program to help us. I make a single middle class income. We took the credit to pay for washer dryer etc. I see millions going to someone or some bank or some car company, but my family has not seen anything. Now my student loans have skyrocketed, my credit card companies are hitting me with more fees, my health insurance has gone up, and secretly groceries have tripled but no one says anything. This credit not being extended to those of us that first took part in the program is a disgrace and I regret having to have had to use it. The new credit is open to all home buyers. The only ones who can not benefit from this program are those who were the first to trust it. And here is the only place i can vent… maybe 1 person will read this.
    Paul powerlinep on facebook.

  17. Anonymous

    Okay, I know I’m going to get slammed for this and seem very irresponsible…but here it goes. I was with my company for six years and moved several times with this company. My last move was to an area where I could actually afford to finally buy a house. My wife and I had 2 daughters and she was giving birth to twin boys right when we moved to this area. So we bought the house, had the twins, took the tax credit (purchased house in 9/2008). Just like with so many others, the recession got the best of me and my position with the company was eliminated. We couldn’t make ends meet, we used our tax credit to pay bills (mostly credit cards and medical). My wife finally said that she couldn’t take it anymore and wanted to move back to her country. So in a drastic move, we put the house up for short sale and left the United States. We just recently sold the house for nearly $50,000 less than the purchase price. The short sale was approved and it’s all finished now. My question is, how badly am I going to get hit this tax season. Are they going to make me repay all $7500 at once? I’m living outside of the US and waiting for my residency papers so that I can work here. Repayment is going to be really tough. Like I said…I know how irresponsible this makes me look, so don’t be too brutal. Any comments would be appreciated.

  18. Anonymous

    I bought my house May 8th and submitted for the first time home buyers credit on my 2008 taxes on May 12th. I still haven’t recieved any money. My file went through exams and they approved the return on Aug 31st. It has been a total of 180 days. Here is my message to the President: Mr. Obama, The reason this economy isn’t doing better is because the people responsible for handling your incentives are slackers or just plain stupid. DO NOT COUNT ON THIS MONEY FOR ANYTHING IMPORTANT!

  19. Anonymous

    honestly most of you who qualify should feel blessed to have the opportunity to take advantage. The disadvantage are to those who bought prior to April 2008 but havnt been in long enough to qualify for the new tax credit. This system is designed to get us and keep us in a rut. a lot of folks who bought during the peak of the housing are stuck in inflatedly priced homes and are housebroke, ans still the government refuses to help those folks. when i file for bankruptcy, im never borrowing money for anything again

  20. Anonymous

    I agree with Joe, I bought in August of last year and got the $7,500. agreeing to pay back the $500.00 each year for the next 15 years, everywhere you looked it was do it now the tax credit will not last. NOW, they pass the tax credit for $8,000. with NO REPAYMENT! I do not feel this is right, those who are eligible (purchased a home between 4/1/08 – 7/1/09) for the $8,000. tax credit, but got hooked into the 7500. should have the ability to reapply and pay back the 7500. with the credit from the 8000. Only fair!

  21. Anonymous

    I dont get this, how does a person who bought their house in 2008 at a higher interest rate and higher home price get 7500 that has to get paid back, yet a person who buys a house in 2009 at a lower interest rate and cheaper house price get 8000 that does not have to get paid back. The way i see it is you shouldnt give anybody anything but if you are going to give tax dollars away why does one pesron have to pay back and the other person get a free ride

  22. Anonymous

    People have short memories! The real estate market was crazy between 2005-2007 and everyone complained about how expensive it was to purchase. Homeowners were asking astronomical prices for cardboard boxes.

    Now prices have fallen through the floor, vacant properties are destroying neighborhoods and the government is providing incentives to get nervous buyers back into the market.

    If you were able to buy “before” the tax credit – count your blessings and stop denigrating those who can take advantage of the benefit. Believe it or not some of the homebuyers are taxpayers too. Grants have always been available in some form from organizations out there and not everyone could benefit – I couldn’t. I was lucky enough to have held off buying and now there is incentive for me to jump into the market without taking a huge chunk out of my account.

    Like many people, I’ve been watching the market and managing my pennies and will stay within my means. Hopefully the economy will get moving again.

  23. Anonymous

    im not sure about that but i thought it would be a separate from your income tax only if you did both on the same day i thought irs would deposit your full amount together if its done that way.

  24. Anonymous

    Your refund will be included in your tax refund, or will offset the amount of taxes you owed. In short, you will only receive one check or deposit from the federal government.

  25. Anonymous

    is this first time home buyer credit separate from your refund of is it included in your refund? i thought i would be getting a separate check or automatic deposit in my bank account that was just for $7500 i was eligable for.

  26. Anonymous

    thanks! another thing i did i filed my taxes in feb & applied for the tax credict on mar 03-09 i was wondering was that a reason y didn’t recieve it in 2 weeks instead i have to wait until 6 to 8 weeks?

  27. Anonymous

    If you sent your tax return by mail it takes 6-8 weeks. If you e-filed your return, it only takes about 10 days. You can go online to irs.gov and check the status of your return and make sure that it is not being held up for some reason. If it is, you will get instructions that will tell you a number to call etc… I have called them before and it is not too bad. My son bought a house in Feb. tried to file his tax return with the tax credit the same day by efile but the irs was not set up to take efile on the tax credit yet. He waited two weeks and got his whopping check in 10 days!

  28. Anonymous

    hello i was wondering i filed for my tax credit on mar 3rd and sent off my paper work the same day why do i have to wait 6 to 8 weeks for me to recieve my tax credit? and will i actually recieve it its now my 6th week and im still waiting.

  29. Anonymous

    This is incredibly confusing! Is there any credit for a first-time home buyer (me) who closed on February 1st, 2008? If so, do you know what form i would use to claim it?
    Surely, there were credits for home purchase before last year? What are MY options? I could just cry right now given these numbers and dates. Please help if you can. Thanks. ~KM

  30. Anonymous

    I know that the IRS will allow the 7500.00 credit

    “If you constructed your main home, you are treated as having purchased it on the date you first occupied it.”

    I closed on my house April 1st 2008 but did not occupy it until mid May. Does the rule only apply to new construction or would a situation like mine be eligible for the credit?
    Thanks in advance- Lee

  31. Anonymous

    I have a question! So the tax credit is for home purchased AFTER April 8, 2008. What would be the purchase date? Is it the day you acquire the home? b/c the settlement for my home was exactly on April 8, 2008 but I didnt get the keys to the house 2 days after that. So do I still qualify for this tax credit?

  32. Anonymous

    To those of you who qualify for the $7500 tax credit that HAS to be repaid…..PLEASE, please write to your state Senators and Congressmen of how unfair the current $8000 giveaway is for 2009 first time homebuyers! The $7500 credit was pushed by the government to stimulate the housing market…..and now the ones who procrastinated get mightily rewarded and the ones who bought in 2008 get completely shafted. Write now!!

  33. Anonymous

    I think the credit/loan is a horrible attempt by the government to fix the problem. Its a band aid for a wound that needs stitches. That being said as a recent home buyer I took the credit, because its there and I might as well use it. I took the entire $7500 and used it all as a principle payment against my mortgage. Since my mortgage is at 6.25% I ran some calculations and if I sell my home in 5 years (my mental plan) the governments money will save me $2500 of interest avoidance so to speak. Sure beats what a high yield savings account would give me. Not sure that is how the the government wanted me to use it, but since I dont need the money at all and already have an emergency fund and investments, I figured it was the safest and most prudent thing to do with the money. And since the money is “buried in my mortgage” it also acts as an insurance policy in case my home sells for less than I bought it for. I encourage anybody else in my situation to look at doing this.

  34. Anonymous

    My biggest question/concern is how taking this tax credit will affect my credit score and ability to get future loans within the 15 year period.

    This doesn’t seem to be answered anywhere.


  35. Anonymous

    Will this $7,500 be taxable as part of our federal tax refund on our CA state return? I’ve not found any info addressing this issue; as a loan it should not be taxable.

  36. Anonymous

    I purchased my home in Oct of 2008 and I am in the process of drafting a letter to our Congressman. It seem ridiculous that those of use who purchased a home in that 8 month period have to pay it back. All this does is sends a message that if you hold off and wait a better benefit will be implemented…and isn’t instilling a sense of hesistation in consumers that worst thing to do at this time. All benefits should be retroactive, so that people don’t feel like sitting back and waiting will yield better benefits…we want people to go out and spend now, then you should not make them afraid of doing so.

  37. Anonymous

    I purchased my home in Oct of 2008 and I am in the process of drafting a letter to our Congressman. It seem ridiculous that those of use who purchased a home in that 8 month period have to pay it back. The original home buyers credit was issued for the same purpose of stimulating the housing market; why should those of us who participated in this in 2008 have to be subject to different conditions of repayment? All this does is sends a message that if you hold off and wait a better benefit will be implemented…and isn’t instilling a sense of hesistation in consumers that worst thing to do at this time. All benefits should be retroactive, so that people don’t end up feeling cheated as we do and don’t encourage others to wait…it will only make things worse. I hate the fact that 10 years from now, those of us in this eight month window will still be paying off this loan, while other who waited just a few months get better benefit free and clear. PLEASE WRITE TO YOUR REP!!!

  38. Anonymous

    I too am frustrated with the decision to not relieve those who bought in 08 of paying back the “credit”. I debated taking the $$ but in the end did it and will stick it away for safe keeping. If you plan on purchasing a flat screen and new entertainment center you will likely find yourself in the same hole I’ll bet you are already in. If you invest this money, even in a basic savings account, you will make a tiny bit of money and have some money to spend if you find yourself in a true crisis or emergency.

  39. Anonymous

    I qualify for the $7500 as I bought in April ’08. At first I was inclined to take it as $500 per year for 15 years is a very easy payment for us to make, however after reading further and realizing that it must be paid back in full if the house is sold inside of the 15 year window I was leary. To me it still seems like a good deal as you get $7500 to spend or invest, etc but what if we sell in 5 years and have 10k equity in our home, then we see that equity sliced by the amount owed back to the government. Am I correct in this assessment?

  40. Anonymous

    From what I have read, the 08 buyers have to repay the 09 buyers do not. I bought in 08 and I am kinda frustrated but hey it it still a $7500 dollar interest free loan, who is ever going to offer an interest free loan? Take it!!!

  41. Anonymous

    I’m confused. With the bill that was passed today, does the $7500 tax credit from 2008 first time home buyers need to be paid back? I’ve read a lot where congress was going to change the terms of the initial credit to where it didn’t require payback. Thanks.

  42. Anonymous

    I purchased April 4, 2008 and was told I would receive the credit. Thank’s for the great posts and information, although I would have preferred to have found out I was eligible…

  43. Anonymous

    I thought that as well. I have heard great things about turbotax so I will probably use that software. I do know this…I WILL NEVER use H&R Block in the area I live in.

    Thanks Booch for the information, I will be sure to wait until Tuesday.

  44. Anonymous

    You can claim it this year. I filed on H and R Block’s online system and they have the appropriate place to claim it for 2008. But I would wait until after Obama signs the bill on Tuesday so you can claim the $8000 tax credit. That way you will not have to file an amended return.

  45. Anonymous

    I am now terribly confused. I just closed on my home 2/11/2009. I went to H&R Block and was told that I could not receive my first time home owner tax credit until 2010…is that correct? I was under the impression it could be claimed on our 2008 return and collected this year.

    Any clarification on this issue would be greatly appreciated.

    I don’t want to hear how fair or unfair this credit may be, strictly the facts.


  46. Anonymous

    I don’t know why anyone would complain about getting $7500 on an interest free loan for 15 YEARS. I hope they keep it this way, I don’t like the idea of a “tax credit” that doesn’t have to be paid back. Why does everyone want something for free?? Getting an interest free loan for 15 years is a great deal for anyone. I think the only homebuyers that should actaully get a true “tax credit” should be people who make very little money (maybe use RD income limits)

  47. Anonymous

    It is being reported by AP tonight that the $15,000 tax credit has been stripped from the reconciliation bill.

    “Working to accommodate the new, lower overall limit of the bill, negotiators effectively wiped out a Senate-passed provision for a new $15,000 tax credit to defray the cost of buying a home, these officials said.”

    All this angst, apparently all for naught.



  48. Anonymous

    yup, line 69. I thought I read that you can only use the regular 1040 form and cannot attach the Schedule A for the deductions, but I have not seen it anywhere since.

    I definately want to itemize this year, as it is my first year of mortgage interest and I think I can claim my closing costs as well.


  49. Anonymous

    There is a line (sorry, don’t have the form in front of me to tell you specifically) on the 1040 to write in your form 5405 credit. Don’t see how itemizing could change that…. although I could be wrong. I was going to do the same thing though, but I’m holding out for the new credit (if they ever work it out). I closed on Jan.30, 2009, so I’m hoping that I’ll fall within the new credit dates, which I have yet to see any info on.

  50. Anonymous

    All of this info has been great. I closed on April 30, 2008, so I will be claiming the $7,500 refundable tax credit when I do my taxes.

    One question I do have and I thought I saw it somewhere once that I could not itemize my deductions and still claim the credit. Does anyone know that when I claim the credit using the 1040 (attaching schedule A) and 5405 forms, am I able to itemize my deductions and claim the $7,500 credit?

    Thanks in advance.

  51. Anonymous

    Does anyone know if the date will be retroative to before April 9, 2008? I noticed there was something posted about February 28, 2008. Thanks for any insight that could be rendered.

  52. Dean: Actually, it is complicated enough to take up the space that I gave it. There are income limits, effective dates, the possibility of this being converted to a true credit, and even the possibility of this measure being replace altogether by a larger credit under the new stimulus bill.

  53. Anonymous

    this isnt complicated enough to fill up one page. you get to add 7500 to your refund. you pay in back in 15 equal payments–deducting 500 from your refund for the next 15 years–interest free–next question?

  54. Anonymous

    But what are the eligibility dates for the new tax credit? And is this new $15,000 credit another “have to pay it back” arrangement or is it truly a real tax credit?

  55. Anonymous


    Isakson’s press release reads: “The amendment would sunset the current $7,500 housing tax credit on the date of enactment.” What does the term “sunset” mean there? In this context, the term “sunset” means that the $7,500 new home buyer tax credit would be supplanted by the proposed $15,000 credit, which applies to all home purchases–not just new homes. “If you are operating under the $7,500 [credit], that’s the one you [have],” says Joan Kirchner, Sen. Isakson’s Deputy Chief of Staff. “Then, from the date of enactment forward, the new one takes over and nobody else gets the old $7,500 [credit].”

    That last sentence makes it official as far as I read it.


  56. Anonymous

    The way I see it, why take the chance of missing out on both credits if you qualify for the old $7500 credit? I went ahead and filed this week when I heard that this new bill will sunset the old credit once Obama signs it.

    If you file now, and a better deal comes along, you can always amend your tax return.

    Losing out on not having to repay sucks somewhat, but right now, a $7500 tax free 0% interest loan is too good to pass up, especially considering they are simply loaning me my own money before it is withheld from my future paycheck for the next 15 years. I ALWAYS get at least a $1200 refund. So now, I will only get a minimum of a $700 refund. If I adjust my withholdings by $45 a month I will not even see a difference in my refunds.

    But why let Uncle Sam earn the interest on my future earning when I can instead. Taking the credit NOW is a no brainer for someone in my situation.

  57. Anonymous

    Here is what I am sick of hearing how everybody thinks this money is for people who cant afford a house to buy a house with this money. Me and my wife are first time home buyers buying a forclosed house who can afford the payments and have saved for a down payment. And this money will come in handy to pay for all the repairs that people who had bought houses that they could not afford in the first place and decided to destroy a beautiful house because they could not make there payments and were “mad at the banks for not understanding what they were signing”. GIVE ME A BREAK!! You were greedy and selfish and now you have to pay for it. We have looked at so many houses that have missing appliances, missing cabinets, pee stains all over the carpets, holes in walls, missing air conditioners, just totally destroyed because of there stupidness. So yes I am very happy to be receiving this money and I thank the government for it. Even if I have to pay it back. Maybe if people would appreciate what they have instead of always wanting more and never being satisfied with what they have. Then maybe just maybe we wouldnt be in this situation.

  58. Anonymous

    Previous poster…I would be upset with my loan officer if I were you. The only requirement regarding the downpayment change to FHA was that your FHA case number be issued by 12-31. In your case I am sure it was probably issued well before that. As long as this was the case you could close with the old 3% down rule after 12-31 and your first payment would not have been due until March 1st.

    I also closed FHA with 3% down and it was done on the 2nd of January.

  59. Anonymous

    I guess what makes me so mad is that I fell for the government’s first effort. I wanted to get the credit this tax year, and lock my loan in before the FHA program changed. Thus a Dec 31st close. That some people will get a break under the same program (those who bought one day after me with the same market knowledge and dynamics), but I will not is what is so upsetting.

  60. Anonymous

    Yeah…but it’s kinda hard to get over the missed opportunity to really get ahead with an interest-free loan…My husband and I closed on March 28th as well, and that money would sure help us out. We’re pretty disappointed.

  61. Anonymous

    Ok scot and everyone else complaining about the date, Guess what, if the date was january 1 of 2008, people would complain about that also saying, I bought my house on dec 3rd of 2007, why did they pick jan1 and not a time where i can get the benefit…GET OVER IT.. this is rediculous. DO YOU GET IT YET!!!!!! How dumb are people…. sorry if you dont approve of the date, but that is just the way it is… GET OVER IT…

  62. Anonymous


    I don’t think YOU get it. This bill wasn’t passed on April 9th, and that’s why Bush chose that date. As a matter of fact, the bill wasn’t passed until July. They picked the April 9th date for some reason…however it isn’t very fair because if you listen to Bush’s speech concerning the bill, he states that the bill was aimed at helping those who purchased a home in 2008. Then he choses a random date in April. I purchased my home on March 28th, less than two weeks shy of the cut-off date. I purchased my home in 2008 and that purchase contributed to the housing market. It took my wife and I all that we had saved to purchase this house. We can afford the payment and we’re slowly building our savings back up, but this credit would have been so beneficial for us, despite having to pay it back.

  63. It’s not intended to be fair. It’s intended to get people to go out and buy houses. If you already bought, then you’re not part of the target audience. It sucks, but it also makes sense.

  64. Anonymous

    Tricia –

    I am in the exact same situation, also closed on my first home on January 30th. I am a CPA and did taxes for the past ten years, but have left the public accoutning field over the past year, so I have similar questions. But from what I know about tax law, you can ammend past tax returns. So if these laws do change you would need to be able to pay back the $7,500 in order to amend the 2008 tax return, but you can always remove the credit form the 2008 tax return to make it available to take on the 2009 return. I do not see how they could stop us if we bought during 2009 of taking advantage of any recent amendments.

  65. Anonymous

    I would think that if you take the credit on 2008 and there are changes to this credit that you could always file an amended 2008 return next year. You would need to send the money back that you recieve and then refile under any more beneficial plans that come to pass. Not sure here…but it seems logical.

  66. Anonymous

    I have just closed on a new home and have every intention of taking advantage of the tax credit. I figure this is a way to get some of those home improvements done sooner than planned. But as I listen to the news I hear about 2 proposed revisions and wonder how/when these may effect me. As I understand it now, I can get $7,500 which would be repaid of 15 years with 0% interest. New option 1: no repayment is necessary. New option 2: the amount gets repaid still at 0% but the amount can go up to $15,000. So my question is this… what if I apply for the credit now and then the program changes? By doing this with my 2008 taxes (since I can) am I going to lose out on “free money” or more credit? Would there be any retroactive adjustments allowed? Would I be better off waiting to do all this with my 2009 return? (I closed on January 30,2009, so could do either year according to the rules).

    Can anyone offer any guidance here?

  67. Anonymous

    A couple of things.
    1) For those who complain about people whining for buying a house recently but before Jan 1, consider that the people who purchased houses between then and the beginning of the debate on this bill did were not motivated to buy the house with the tax credit, yet still benefit.

    2) The people who seem most concerned with the tax credit not being fully refundable are those who qualify for the 7500 tax credit under the 2008 bill, but will not qualify for the free money portion of it. It seems that a non arbitrary cut-off would be fully refunding all those who qualify for the first time home buyer credit.

    3) Consider my case. I researched and found that the FHA down payment requirement was going to rise on Jan 1st. So I closed on Dec 31St. I am in a loan that I can afford, and was planing on using the Tax credit slowly, if at all. the government singled to me that I should act before Jan 1 and now I’ll probably be out $15,000.

    4) People like me and those who did follow the government signals and have recently bought a house with the thoughts of the tax credit have a very very high marginal propensity to spend. We’ll put the money back into the economy in a highly fast and effective way, home building projects, consumer spending (70% of the economy) on the house, ect… Probably the best sort of folk to target for a recovery program, cause if you can get a loan now, you are probably fiscally responsible.

    5) If this seems unfair, email your senators they really do pay attention to their mail and the feel of their voters. Tell them to waive the repay of the first time home buyers tax credit for all who qualify for the original bill, not just just the lucky few who’ve purchased in the last 30 days they really do pay attention to their mail

  68. Anonymous

    We just closed our first house for the first time and NO, we are not irresponsible adults. We take the economic status to a height and our finances. Hope this bill for “true-credit” gets approved. I heard Australia had been doing the same thing for free. This would help a lot and attract more buyers minus the amount it would cost and the buyers money it would generate. But then again there should be a –fine line between checking the buyers capability as a long term investment on a house, otherwise there maybe a possibility of sinking everything back.

  69. Anonymous

    @Ross: Thank you very much, I was under the impression, and understand that came from others word of mouth (them not having a clue) that it had passed.

    Thank you very much for the clarification, and I will start following it much more closely. Thank you again.

  70. Anonymous

    @Chad: It looks like the bill currently proposed would not require people who purchase a house after 1/1/2009 to repay the credit.

    Remember: THIS BILL HAS NOT YET BEEN PASSED, so it is not law yet, so as of the law that stands today, you would have to pay back the credit. Hope this helps.

  71. Anonymous

    I am in the middle of closing and though it is probably due to my lacking of tracking the current events I am totally in awe at the confussion being caused by the both old and new bill. I understand in the old bill that it was a repayable loan, so interest free not a bad deal, but the new one I haven’t fully comprehended.

    Even if it’s still an interest free loan you get dollar to dollar interest free loan, but does the new one also require you to pay it back over time or are you omitted from the repayment???

  72. Anonymous

    another point of our irresponsible goverment and the over taxation of the working man. me and my wife bought our house 10 yrs ago and still live there. you did not get a 7500 tax credit for first time homebuyers. then why should people who have been responsible and paid there bills be responsible for paying everybody elses. i think this is a real crock of crap because 99% of this money is not going to be used correctly.it is just another screwed up mess that our great grand kids are going to be paying off. and the only people thant wont agree with this are the ones that get it or wish they could.

  73. Anonymous


    I think you have a great point here… Life is never fair.

    I am an engineer, not an economist, so I am probably missing the point of this 7500 credit. Irrespective of the qualifying period for this credit, the way I look at it is – if you want to sell a product that is not selling you need to lower the price to make it attractive. In this case, home prices have already come down, thus making this credit superfluous. The main concern of a new home-buyer is the falling prices. Therefore, if the Fed assured them that in future whenever they have to sell the house or get home equity based on the home value, it would cover 10% or upto 7500 of the loss in home value, IF ANY, that would alleviate the home-value concern.

    Someone who does not think can afford a home right now should not be encouraged thru such means to fall in this trap. That would be a wrong impetus. How is this different from the sub-prime mortages offered by banks which was a big reason for all this mess. A 0% loan from the Fed is nothing but an extreme case of sub-prime loan since the credit is not based on the buyer’s credit worthiness. Am I missing something here…?

  74. Anonymous

    A bunch of you folks just aren’t getting it.

    Why can’t it have been (two days, two weeks, two months, two years) earlier? Because the point was to get people to buy from that point on! There always has to be a cut off somewhere — get over it.

    Why can’t the idea of forgiveness be retroactive for everyone who gets the credit? Because the point is to increase the impetus to buy now. Making it retroactive only loses the gov’t money — you’re not going to be more likely to have bought three months ago because of this bill that’s coming out now. Therefore it defeats the purpose.

    If you’ve already bought — you are getting the benefit of the tax break since it’s helping to prop up your home value.

    The only people who are truly getting stiffed are those of us who are renting and won’t be buying in the near future. But if the economy actually recovers some, then we gain too.

    Do some people gain more than others? Sure they do. Life’s like that. At least for once the people who gain the most aren’t people making $5 million a year or more.

  75. Anonymous

    Imagine how I feel. I closed on May 1st, so I AM eligible for the credit, but according to what’s in the currently proposed stimulus package, I will STILL have to repay MY tax credit, but those that qualify for the EXACT SAME tax credit, but who closed AFTER January 1st (instead of the original April 9th date) WON’T have to repay it. Now how fair is THAT?
    Why should I have to repay mine but they dont have to repay theirs.

    Either everyone who gets the credit should have to repay it, or no one who gets it should have to repay it. It make no sense, and I emailed Sen Isakson of GA, who sponsored the new Bill (Senate Bill S.253) and told him so. I encourage everyone do so as well. Let your State Senator and Congress person know as well.

  76. Anonymous

    This $7500 tax credit seems to be quite UNFAIR to folks who bought their home prior to Apr 9 ’08. I don’t want to sound like a jealous kid who bought in 2006, when the home prices were much higher, mortgage rates not as attractive as today and is right now finding it tough to even refi bcoz of lower appraised value. While those who were anyway planning to buy in this period are getting all the advantages – lower home price, great rates and this windfall money. As someone said here before, how does a retroactive credit help in bringing in more new home owners who wouldn’t have otherwise thought of buying one. If the Fed’s point here is to assure propective home buyers that home prices will not fall anymore then why not present this credit as an insurance upto 10% or $7500 if the home prices were to fall and they had to sell theirs in the future. The bottomline is – will this credit really make an impact whatsoever to the economy? Time will say…

  77. Anonymous

    I bought a house last year and not one realtor knew about this. I am eligible to get it. The non-repayment stimulates knothing as I’m already in a new home. This is robbery from tax-payers who didn’t buy a home last year. I feel like I’m a recipient of the human fund. (Money for people)

  78. Anonymous

    I am glad that you have the forms in front of you. I had not seen them. It does give me hope that we may be able to file for the tax credit in 2008 when we are buying in 2009 and not have to repay it if this new part is approved. I would still like an official answer from somewhere.

  79. Anonymous

    It is my understanding that is the way it works. But if you filed it on 2008 taxes your repayment would not start until your 2010 taxes are filed. So it give you a couple of years to start repaying.

  80. Anonymous

    Just have a repayment question. Is the $500 due on the taxes at the end of the second year? If I get normaly say get $1,500 refund, the second year I’d only get 1,000. And, the $500 will go for the repayment? Just wondering. Thanks!

  81. Anonymous

    Same question here…closed on the 2nd of January…hopefully I will just miss repayment requirement…but I would also like to claim it now to use for updates on the house.

  82. Anonymous


    I am wondering the same thing as yes you can file for it on your 2008 return even if you purchased the home in 2009. For example, my wife and I just purchased/closed on a home on January 23, 2009. If you look at the 5405 form you have to put the date of the purchase and also (line 3) check off if you are taking the credit for a home purchased in 2009 on your 08 return. I think this will be a great tax law question because the form clearly designates a spot for 2009 home buyers to claim on the 2008 form while also distinguishing them from the 2008 buyers by checking a box that the purchase is in 2009. I am not sure who the best person will be to check with whether it be someone from the IRS, or your House Rep or Senator. Lets all work collectively to find this answer and then post it up here.

  83. Anonymous

    There is discussion in the new stimulus package that if you purchase a home in 2009 that the $7500 would not have to be paid back if you own the home for 3 years. It is been my confusion if you claim it on your 2008 return that you would fall under the original plan which would make you pay it back $500 over a 14 year period of time. Still not clear. So when you file if you claim it for 2008, don’t you have to state that you purchased the house in 2008 which would make you part of the original plan? I would think a person would wait and file it on 2009 to make sure that it was not a loan and a true credit…… still confused.

  84. Anonymous

    I closed on my house 1/16/2009 when will i recive my 7500 loan, this years tax return 09 or will i not see the money till 2010? If I could get a answer on this it would realy clear things up.

  85. Anonymous

    We are also military. I’m guessing that since the home was your primary residence at the time of the credit it will not be an issue. We will probably have to rent ours if we have to PCS as well and will be taking the credit.

  86. Anonymous

    Bought a house that closed April 15th, 08. ; ) I am active duty and was wondering if there is any exemption if I get PCS orders out of this duty station. Do I just keep my mortage and repay this, if I don’t even live in the house; although it says it has to be your primary residence… Kind of stuck, I never know when I will have to sell my house, I gets thats part of being in the Mil though. Just can’t wrap my head around not taking it though, seems too easy… Just don’t want screw myself

  87. Anonymous

    If you can get it and pay down debt or invest the money to fully fund your IRA then do it. This is truly a gift and there really isn’t a negative to it. You don’t even get a credit ding!

  88. Anonymous

    In Tylers case it might be looked at differently, being that he is losing his house, they may not give it to him. If you can get it great, but just as people have been saying “people are taking ADVANTAGE of this, when they shouldn’t own a house in the first place” This must be one of those “irresponsible Buyers” Now this could make people made!

  89. Anonymous

    Tyler: See comment 7 above. I asked an official tax advisor about the same question.

    If you look at tax topic 611 on the IRS website:

    You will see the exception listed out:
    “In the case of a sale of the principal residence to an unrelated person, the increase in tax due to accelerated recapture is limited to the amount of gain (if any) on such sale. For purposes of calculating gain, the adjusted basis of such residence shall be reduced by the amount of the first-time homebuyer credit allowed, to the extent not previously recaptured. In the case of an involuntary conversion, recapture is not accelerated if a new principal residence is acquired within a 2-year period. No amount is recaptured after the death of the taxpayer.”

    The adjusted basis price is calculated by taking the purchase price of the home and subtracting the amount of credit you received.

    I am not a tax advisor, but this is the exact information that my advisor gave me.

  90. Anonymous

    Rich: Thanks for the response. Yes, that is my understanding as well, but I cannot find documentation of this and really do not know who to ask, as we do not employ an accountant. Thanks again, any additional comments are greatly appreciated.

  91. Anonymous

    Tyler: from what I understand and you really need to check on this but you definitely should as I do not believe payback in required if you lose money on the house. Again check and I don’t know the specifics of your short sale but look into it.

  92. Anonymous

    Hey guys, this is a great blog, very informational and thanks to all who have contributed. My question is: If we purchased during the allowed period, and are planning to sell our home as a short sale in March 2009 or so, should we take the credit? Will me and my wife me required to pay back the credit even though we are selling our $230,000+ home for a $30,000 loss in a short sale? Thanks in advance for your help guys.

  93. Anonymous

    Yeah this blows i bought my house FEB 29th 2008 and now i cant recieve this credit. Why the heck is is April 9th, the economy had already nose dived way before that.

    I would so drop this on my home to lower my interest payments if i could recieve it though. If people use this money right it very well would help stimulate the economy but these things usually get put into the wrong hands, people that will go out and buy a newer car or take vacation and something else that is retarted with the money, which you have to back.

    AHHHHH i am so mad. And for the person that is complaining about having to pay it back. ITS 0% interest at $500 dollars a YEAR, dont tell me you cant come up with that.

  94. Anonymous

    People have to realize that a no interest loan is free money! just not $7500 worth of free money at least not right away. Even if you don’t need the $, why don’t you take it and just put it toward the principle on your house and its that much less you have to pay in interest! Better yet if you have a car loan or students loans that you can’t write off the interest from your income pay those off. Even take it and put it in a high yield savings account at %3 that’s almost 4K free by the time you pay it back in 15 years or better yet buy a 15 year bond (I know its kind weird re-lending the government money it just lent you) but there’s nothing to say you can’t and at the end of that the loan will almost be free. Point there is no reason in anyone’s situation why you should not take this unless you are just really undisciplined and bad with money, in which case you probably shouldn’t be a home owner anyway.

  95. Anonymous

    We bought our house (that had been on the market for over 2 years empty) Feb 1st, had to work night and day for 2 months just to be able to live in it…Our so called loan would have only been 3,850 however that would have paid for new windows for our house. (We live in rural IL). Why April 8th..strange date…

  96. Anonymous


    The ways and means only discuss the post Jan 1 2009 purchase. The S. 253 and the discussion from fixhousingfirst.com are suggesting changes to the current tax credit. The ways and means you refer to talk only to changes in anything Post Jan 2009. Take a look at http://www.fixhousingfirst.com Does anyone have any suggestions on where to find proposed bills sent to from the house to the senate as this is where the stimulus/bill are at now?


  97. Anonymous

    I think this credit is aimed at people such as my wife and I. We are in the process of buying a house right now. We have a decent down payment that we took a long time to build up, but laying it all on the line would leave us both uncomfortable and possibly vulnerable in our new home. Having this credit takes me from being nervous to confident in my purchase as now I don’t have to deplete my savings to do it. If the credit helps more people who are capable of repayment make the commitment to buy, then it will in fact help out the housing market which is good for everyone, homeowner or not. Some may not see it that way, but luckily they aren’t the ones voting on such things.

  98. Anonymous

    My only problem with the credit is why was is not retro back to Jan. 1, 2008. I closed on my home on March 28 and I had an original close date of April 11. If I would have known something like this would take place I would have waited to close on April 11. I would definitely take the credit, if I was eligible. Have anyone heard about any changes with the retro date?


  99. Anonymous

    You can find more about the current proposed “American Economic Recovery and Reinvestment Plan” here:

    All of the tax implications are rolled into this pdf:

    Including the provision:
    “Refundable first-time home buyer credit. Last year, Congress provided taxpayers with a refundable tax credit that was equivalent to an interest-free loan equal to 10 percent of the purchase of a home (up to $7,500) by first-time home buyers. The provision applies to homes purchased on or after April 9, 2008 and before July 1, 2009. Taxpayers receiving this tax credit are currently required to repay any amount received under this provision back to the government over 15 years in equal installments, or, if earlier, when the home is sold. The credit phases out for taxpayers with adjusted gross income in excess of $75,000 ($150,000 in the case of a joint return). The bill would eliminate the repayment obligation for taxpayers that purchase homes after January 1, 2009. The provision would retain the credit recapture if the house is sold within three years of purchase. This proposal is estimated to cost $2.562 billion over 10 years.”

  100. Anonymous

    Someone had stated that if the bill passes that only repayment will be required by those who purchased a home in 2008 and if you bought a home in 2009 let’s say today Jan 25th 2009…you wouldn’t have to repay it at all.

    Can someone, anyone, show me where to find this proposal I would like to read it myself.



  101. Anonymous

    I must be awfully dumb. I’m having a hard time seeing how forking over an interest-free loan (or a free handout) to recent home-buyers — who have presumably ALREADY purchased a house or have made the decision to do so, right? — is going to do much to turn the housing industry around.

    If you bought a house in 2008, this isn’t going to cause you to run out and buy another one, nor is it likely to increase the value of your home. It might be that if you used it to finish your basement, the money would help Home Depot’s business and maybe keep a handyman or small contractor going for a few more months. If you put it in a savings account and you don’t use a credit union, it might enrich a banker a bit more, and you’d get all of what? 1.5% interest on it? Around $580 over the five years before you have to start paying it back? My house has dropped in value one heckuva lot more than that.

    But if you spend it, soon enough you end up with another $500 (!!) monthly payment, with which you will be saddled for 15 long years. This, on top of your mortgage, your car payment, your utilities, your insurance, your taxes, and your credit-card bills. Yup. Everyone needs that.

    If you sell the house — which unless things change real quick now, you will do at a loss — you have to repay the $7500 out of the sale proceeds, leaving you with even LESS return on the sale than you would have in the current market, which presently is a negative return.

    Meanwhile, the rest of us, who continue to see the value of homes we bought within the past six years or so falling below what we paid for them, get no “stimulus.” We just get laid off.

    Well, I could do without a $500/month bill for the privilege of being stimulated. But if Congress is going to change this to a handout, how’s about giving us all a handout? Or maybe a job?

  102. Anonymous

    actually, the change has been included in both the House and Senate versions of the bill now. But repealing the repayment provision applies ONLY to houses purchased in the first six months of 2009 – houses purchased in 2008 still require the repayment of the “credit”. Also, if you take the credit in 2009, you DO still have to repay it if you sell the house within 3 yrs.

  103. Anonymous

    Kev you bring up lots of good points, but if you dont yet know this; the government sucks our money from us for many stupid things, this is just a small part, and eventhough it is small it is still something….. All you, I and or any other person that pays taxes is, is cattle for the government. we bring them money and thats it…… Look how much they make a year…. We are all screwed. No body can change that.

  104. Anonymous

    I never said that the people receiving this credit were irresponsible buyers, but I do believe this “credit” was born out of irresponsibility. Whether or not the irresponsibility was on the part of consumers, the lenders, or the government can be debated from now until the end of time – whatever… There’s is plenty of blame to go around.

    Some of you said you are going to use this credit to improve your new homes by adding things like finished basements. Others have said they are going to save / invest this money and use as it as an interest-free emergency fund. While I agree that those are very nice options to have, I am failing to see how that will help the current situation.

    I know this may sound somewhat juvenile, but my core issue with this credit is that it isn’t fair and while it may be helping some – it is hurting others.

    Anyone who receives this credit is getting a financial advantage over the people who don’t, even though we are ALL paying for it. I don’t get to build my emergency fund using a fifteen year interest-free loan. I don’t get to finish my basement and increase the value of my home by using an interest free loan. The only thing I get to do is PAY for it. Others will be paying for it too and many of them don’t even own homes – some of them NEVER will.

    The government should not be using my money to give anyone an advantage over me. Our tax dollars should never be used to pick life’s winners and losers – this goes against everything that is free market.

    This credit is Washington’s sad attempt at getting people to start buying homes again. The best they could come up with was “Well… If people can’t afford to buy them, then we will force others to help them buy them!” How is this right? How is this good for us as a nation?

  105. Anonymous

    I’m settling on my first home Feb 20th and I plan on taking this credit to finish the basement. Yet my boyfriend says it’s a bad idea to owe the federal government anything. Wouldn’t it be nice if it was decided on being just a credit after all???

  106. Anonymous

    My wife and I are in the process of buying a brand new home, we were approved for 250,000. we are first time home buyers. Now you all say that most are irresponsible, well eventhhough we were approved for 250 we are buying a new house for 113500. this same house sold last year for 205,000. I am taking the 7500 tax credit simply to finish the basement and bring up its worth.. Dont say most are not responsible, i could have bought something for much much more but decided not to, i didnt want to be irrespnsible.

  107. Anonymous

    I think this is a nice backup plan to those who have put nearly everything they have down for a downpayment on their first home. My wife and myself nearly depleted our savings account to buy a home…(which I’m sure some of you will say was a dumb idea anyway…but locking in an interest rate of 4.5% and buying the new house for 10k under what it sold for two years ago…was hard to pass on.)

    This tax “credit” will be placed in our savings account immediately and begin to draw interest. We will not use this money unless absolutely necessary, and will be used as a last resort if needed for home repairs, loss of income, etc. If we never have to use any of the money and still are required to pay it back….the interest accrued will be money earned. Maybe if we are lucky…the bill will be passed and we will not be required to pay it back at all.

    I do not claim to be a financial guru…so any constructive criticism/ comments would be greatly appreciated.

  108. Anonymous

    The idea is nice but while people don’t have jobs and the economic climate is such that people are saving money and holding off on any financial gambles, I don’t know how much it will help.

  109. Anonymous

    My son is in the process of purchasing his first home. He is trying to decide whether to take the credit in the 2008 tax return or the 2009. Where can I find more information about the people who qualified in 2008 being able to take advantage of the new stimulas package that does not require the tax credit to be repaid?

  110. Anonymous

    Regardless of whether it is a credit or a loan, I personally think it is encouraging the exact people who SHOULDN’T be buying a house to buy one. If you can’t save the money for a downpayment yourself then you probably haven’t done the planning involved on taking on mortgage debt.

    It would be one thing if they were somehow subsidizing the interest rate, and you still need to come up with the downpayment yourself. Coming up with a proper down payment yourself is half of proving that you deserve it right? Proving that you are financially responsible enough to take on the mortgage debt. If you have assistance its cheating.

  111. Anonymous

    If you’re going to buy a house anyway, then it’s a no-brainer that you should take the credit – even if it’s NOT a true credit. You simply cannot beat a 0% loan.

    The thing you SHOULDN’T do is a buy a house to get the $7500 credit and then take a huge capital loss on the sale (beyond the $7500 credit).

    Anyhow, all this amounts to is the government trying to get involved in the housing market and trying to manipulate the prices (keep them from falling and/or push them higher). Meanwhile, tax payers who do not own a house are getting royally screwed in two ways:

    1. Their share of the national debt goes up.
    2. It makes it even harder to buy a house because the governmental policies are trying to keep prices high.

  112. Anonymous

    $835,000,000,000………………please pass the pepto.

    And I have to comment on an above comment too. Yes, this may help some intelligent people who have behaved responsibly, but your comment insinuated that the irresponsible idiots were in the minority, which is not the case AT ALL. The vast majority of this problem has been caused by idiots who overextended themselves on an enormous mortgage with insane interest plans, and probably had butt loads of other consumer debt on top of that. I have been interested in buying a home for a couple years now but I know I have too much debt and not enough saved up for a 20% down payment(which was a restriction that never should have been loosened) yet to actually do so. Even against my own mother’s “advice”, I have already passed on potential “opportunities”. I refuse to be a part of the problem.

  113. Anonymous

    I’m pissed about this credit. I bought my first home at the end of January 2008 so I don’t qualify for this credit (which I would, for sure, take).

    The qualifications should extend back to the beginning of 2008. Such crap!

  114. Anonymous

    I thought I would also share a clarification I received on the the first time homebuyer credit.

    The credit does not have to be paid back if you sell your house at or below the “adjusted basis price” of your home. The adjusted basis price is calculated by taking the purchase price of the home and subtracting the amount of credit you received.

    For example, you buy a house for $200k, and get a $7500 credit. Your adjusted basis is $192500. If you sell your house for that price, you don’t have to pay the credit back. If you sell your house for $195000, then you will have to pay back $2500 on your next year’s return.

    Thought this might be helpful, especially to those who have seen their housing price decline recently.

    And for the record, in response to the comments above, I completely agree with Kev: people need to be responsible for their own personal finances (just like corporations should be held responsible also…) and I think that it is a little crazy that credits like this are actually available. I have personally seen Builders and lenders using these credits just as marketing material, and as another way to entrap those who don’t know any better, and don’t research the topic on their own.

    However, if I am offered an interest free loan like this, I am sure going to take it and stick it in a high-yield savings account.

  115. Anonymous

    “House Democrats recently outlined their $835 billion economic stimulus package, and one of the things that they’re hoping to do is make the homebuyer tax credit a true credit — with no repayment necessary.”

    could you provide a link that has that info?

  116. Anonymous

    I agree too, this is some of the biggest crap I’ve heard. What about all the other homeowners out there. This is either going to be a bonus for people that weren’t expecting it or people who didn’t think they could afford house and still probably can’t are going to overextend themselves cause they are going to get this 7500. And when the money runs out they’ll be in the same situation. I’m fine with a credit that stimulates the economy, but I don’t think this will work.

  117. Anonymous

    To be fair, not everyone receiving the credit were irresponsible buyers. We live in the DC area where the housing market was out of control. We waited two years and watched the market like a hawk. When the house in the neighborhood we wanted became available for a price we could afford we jumped on it. We also spent hundreds of hours with spreadsheets and budgets to make sure we were not being irresponsible. We purchased our home before the credit was announced. While the credit does applaud irresponsible behavior in some it is not the case for all. With the tax credit and with refinancing our existing loan we may be able to pay off our 30 year loan in half that.

    I totally understand your frustration. Had we purchased our home 2 weeks prior we would not qualify.

  118. Anonymous

    Angie’s Comment:

    “Maybe I’m just jealous that I make too much to qualify, but won’t be able to save up enough money for a downpayment for 5+ years. (Yup that’s probably the main reason). That and the fact the government thinks just giving away money fixes things.”

    I couldn’t agree more and I am definitely jealous! Even if remains an interest free loan it’s still an awesome deal – I can’t go out and borrow 7,500 dollars interest free! It’s all starting to get a little old. I realize that we will all benefit from speedy recovery in the housing market, but I’m failing to see how this “credit” will assist with that.

    I purchased my home around six years ago. It was months of spreadsheets, “what-If” scenarios, and educating myself on as much of the process as possible. It was also months of looking at all the homes in my price range that I never would want to buy. I stuck to my plan though and I refused to listen to all the people who were telling me what I could afford. As much as I wanted to buy into what they were selling, I knew that the only person on this planet that was able to tell me what my price range was me and that the brand-new homes in the brand-new subdivisions just wasn’t in the cards. At least they weren’t if I wanted to be responsible.

    Now – b/c so many other people didn’t approach this in the right way, there is all these “benefits” out there that my tax dollars paid for – yet I will never be eligible for.

    I would love to see a “You’re Not A Total Moron” credit! Sorry for the drawn-out post. This is just a sore-subject with me…

  119. Anonymous

    So the government wants to give money… to people who don’t make a lot of money… So they can get into a mortgage that they won’t be able to pay back… Makes perfect sense to me!

    Maybe I’m just jealous that I make too much to qualify, but won’t be able to save up enough money for a downpayment for 5+ years. (Yup that’s probably the main reason). That and the fact the government thinks just giving away money fixes things.

    Did the tax rebate in 2008 make any noticeable difference for Americans or the economy?

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