Jay Jacobs

How does up to $8000 tax credit sound after purchasing your new home? You may qualify for the First Time Home Buyer Tax Credit-In Ventura County.

This is exactly what will happen if you qualify and file for the First Time Home Buyer Tax Credit of $8000 as I explain below.

This first time home buyer tax credit program is available until December 1st, 2009.

What is it? It is a first time home buyers tax credit up to 10% of the purchase price of the home up to $8000 whatever is less. To be a first time home buyer you must have not owned a "main home" for the last 3 years. A "main home" is defined as a home which a person has lived "for most of the time." For married couples it applies to both home buyers.

Also, there are some income restrictions. If you filed taxes separately and your adjusted gross income was over $95,000 the first time home buyer tax credit is unavailable to you. The same goes for married couples who filed taxes jointly and your adjusted gross income exceeded $170,000.

Officially the first time home buyer tax credit is under the American Recovery and Reinvestment Act of 2009. Unofficially it is a great opportunity to help replenish the down payment of your new home.

Let me clarify this: you can not claim the first time home buyers tax credit until after you close your escrow. That means that you still need to come up with the funds needed for the down payment on your own. But after you close escrow, you can take the refunded tax credit and put it back into your savings.

How do you get your tax credit? First you must buy a home before December 1st, 2009. Second you submit IRS Form 5405 with your 2009 tax returns by April 2010.

What exactly will you get as a refund. This depends on your tax situation. Let's look at 3 different scenarios:

1. You owe $4000 in taxes. You had taxes withheld from your paycheck and at the end of the year had paid $4000 in taxes. Since you have already satisfied your obligation, you will receive the entire first time home buyers tax credit you qualify for (remember 10% of the sales price up to $8000 whichever is less).

2. You owe $4000 in taxes. But you overpaid by $1000 with the taxes withheld from your paycheck. You now qualify to receive the overpaid amount of $1000 and the full tax credit you qualify for.

3. You owe $4000 in taxes. But you underpaid by $1000 with the taxes withheld from your paycheck. You now will qualify for the full tax refund minus the $1000 you owe. If you qualified for the full $8000 you will receive $7000.

Finally, do no wait until December 1st to buy your home. As a first time home buyer, you need to start the process at least 60 days prior to December 1st. Why, because once you put a house into escrow it could take at least 60 days to close escrow and you have to close on your new home prior the this date. If you are buying a short sale or foreclosure, this could even take longer.

Bottom line, if you are a first time home buyer, and have been thinking about buying, this is a golden opportunity to get some assistance. Please realize that I am not an accountant, please refer to your tax preparer for specifics to your situation. Also, work with a professional mortgage planner to obtain your financing and seek out a Realtor who can help navigate the process for you. don't miss out on this opportuity to recieve your first time home buyers tax credit-in ventura county

How much should you Borrow for a Home Loan in Ventura, California?

This question can sometimes be answered by looking into your bank account. You may be limited to the amount of money you have available for the purchase of a home.

The other factor is how much of a home loan can you afford. You may want to put down as little as possible, but the loans amount that you are left with may not make sense from a monthly obligation stand point.

While it might be tempting to borrow whatever amount of money your lender is willing to give you, it is important to think carefully about how much you’ll actually need to borrow in order to purchase a new home. From the down payment to property taxes to insurance to interest rates, there are many factors to consider when making this important home loan decision.

Contrary to popular belief, there is no standard formula for accurately calculating the specific dollar amount you should borrow when purchasing a new home. Many web sites offer calculators to help with deciding what amount you should, borrow, but the variables vary greatly from one site to another. Another rule of thumb suggests that you should never borrow more than 2 1/2 to 3 times your gross annual income, or that 28%, 32% or even 40% is the maximum amount of debt you should ever take on (your total housing payment divided by your gross monthly income).

As mentioned above, you may be forced to borrow the maximum due to the amount of saving you have available to put towards the down payment. What you must do in this case is determine if the home loan that you end up with by putting the least amount down is affordable. There are lots of lenders that will provide you with the loan with the least amount down, but you are the one who has to make the payment, and therefore that really becomes the important question. What if you only have the minimum amount of money for a down payment (which is 3.5% on an FHA loan, in most cases), and the payment is not comfortable. Then you need to either seek out a gift from a relative, determine if the city has a down payment assistance program or continue to save for a larger down payment and less of a home loan.

The best advise I can give you is to speak with a mortgage professional and get yourself pre-approved (not pre-qualified) for a home loan. By getting pre-approved for a mortgage, you not only increase your chance of finding the perfect house for your needs, you also become a “cash buyer”, instantly increasing your bargaining power.

As a mortgage professional, I see my role differently than a traditional loan officer. While my job is to match you with the best mortgage available for your specific needs, I feel that it is also my duty to make sure it is the most responsible home loan as well.

Whether you choose to work with me or not, be aware. A lender will often offer you the maximum amount of money that you qualify for, whether you actually need the full amount of not. Because of this, it is vital that you sit down with a mortgage professional who you can trust to figure out your complete financial picture.

Jay Jacobs

805-218-6651

Pacific Coast Lending

Ventura, California

www.venturamortgageguy.com

How much should you borrow for a Home Loan in Ventura, California?