Chicago Relocation

High hopes for the $15,000 bonus for home buyers

February 7, 2009

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The U.S. Senate has high hopes about the $15,000 bonus for home buyers.  This means good things for people moving to Chicago or looking for Chicago real estate.

The key differences between this and the $7500 tax CREDIT, (besides my blatant use of capitals in the word “credit”) are HUGE. The Senate aproved this proposal, unanimously, on Wednesday.  “It is time to fix housing first,” said Sen. Johnny Isakson, R-G. I asked Lane Sears of RWF Mortgage for his thoughts.  Per Lane, here are some of the basics:

  1. The tax credit is the lesser of 10% of the home price or $15,000 and can be spread equally over 2 tax years.
  2. The housing tax credit can be used for purchases of primary residences only…no investment properties or second homes.
  3. The home purchase can be an existing home, a newly constructed home, or a bank foreclosure home…but the purchase must be completed within 1 year of the passage of the American Recovery and Reinvestment Tax Act of 2009.
  4. The home buyer does NOT have to be a “first time home buyer” to qualify for this housing tax credit, unlike housing stimulus based tax credits from last year.
  5. This 2009 housing tax credit does NOT have to be repaid to the government unlike the $7,500 first time home buyer tax credit

from last year UNLESS you cease to make it your primary residence within the first 24 months (i.e.. sell within 2 years). In an op-ed that appears in Thursday’s Washington Post, President Barack Obama painted a dire picture if Congress fails to move quickly to pass the stimulus bill.

This week, president Obama weighed in on the economy in a Washington Post Op-Ed: “This recession might linger for years. Our economy will lose 5 million more jobs. Unemployment will approach double digits. Our nation will sink deeper into a crisis that, at some point, we may not be able to reverse,” The article was entitled “The Action Americans Need.”

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