I feel lucky to be in the position I find myself in right now. As I am sure you are all aware, my main occupation is as a Mortgage Broker for Team USA Mortgage. I am also a Tax Professional with H&R Block and have been for the past two seasons. This has given me a great advantage, as I am able to be trained on how this Act affects the everyday person and also what advantages it provides to home owners.

First, let’s talk about the first time home buyers credit. This is available to anyone who buys a home in 2009. The first time home buyer credit is an $8,000 refundable tax credit. Let’s pick this apart a little. What is the definition of a first time home buyer? A first time home buyer is a person who has not owned a home in the past 3 years. So, if you used to own a home and sold it in 2006 and now wanted to purchase another home, you would be considered a first time home buyer and qualify for the credit.

What is a refundable tax credit? A refundable tax credit is a credit that is issued even if you have no tax liability, and would be added on to any refund you would normally get. The difference is that a non-refundable credit is one that would only allow you to lower your tax liability.

Some of the other rules are in regards to income. If you are single and make more than $95,000 or married and have a combined income of over $170,000. This credit is not required to be paid back.

So what does all this mean? This means if you fit into the first time home buyer scenario, and you’re not thinking about purchasing a home, you are doing yourself a great disservice. This credit will only last through December 1, 2009, so I expect to hear from a lot of the readers, because I know that you are all educated and would not miss out in a once in a lifetime opportunity.

Let’s put some numbers to it. If you were buying a home for $200,000 using an FHA loan, the required down payment would be $7,000. You are going to get a credit for $8,000 from the IRS. The seller can pay all your closing costs and interest rates in the 5.00% range. This sounds like a no money out of pocket home purchase to me, which will probably have a monthly payment less than what you are paying for rent now.

There are many other facets of this act, from extended unemployment, EIC, additional Child Tax Credit, credits for certain energy efficient improvements to your existing home, certain vehicle purchases and additional 529 distributions.  Call us today to see which credits you qualify for.

Bill Degar is a Branch Manager for Team USA Mortgage.  To contact your local TeamUSA/Homefront Capital representative and learn more about available tax credits, please call 816-434-9810 and ask for Brynn-Marie or contact her via email at Kloster@homefrontcapital.com.