I recently read “3 People the Homebuyer Tax Credit Helped” on CNNMoney.com about 3 real life people who took advantage of the homebuyer tax credit. It got me thinking about what a great opportunity this can be for first time buyers who are on the fence about purchasing a home.

The  program is part of the stimulus bill  created by Congress. It offers up to a $8000 tax credit to first time home buyers as an incentive to boost home sales.

I know from personal experience that when you’re purchasing a home for the first time, $8000 added to your budget can make a huge difference. In fact it could make the difference between deciding to purchase and feeling like you just can’t quite swing it financially.

The article sited 3 different people from different parts of the country who took advantage of the credit. In all 3 cases, the tax credit had a huge impact on their ability to purchase a home.

Rob Logan purchased his home in October 2009. “I wouldn’t have been able to afford my house without it, it was one of the main reasons I started looking”.

More good news! The original credit expired in November, but due to the popularity of the program has been extended to April 30, 2010. There is talk of a further extension as well.

1. Home prices have fallen making this an excellent time to buy. Purchasing real estate in a down market is an excellent investment in your future. Over the long haul home prices still appreciate more than the stock market.

2. Interest rates are currently at near record lows making purchasing a home NOW more affordable than ever! Lock in on an interest rate that fits your budget.

3. First time home buyer tax credit. If you are a first time home buyer (haven’t purchased a primary residence in the last 3 years) and meet income regulations you qualify for a $8000 federal tax credit! The full amount is refunded to you directly in your federal return. More info at: FederalHousingTaxCredit.com

4. Mortgage loans are available. If you have good credit and a down payment, lenders are eager to work with you.

5. Great selection. With so many homes on the market you can get the fabulous features you want at a price you can afford.

6. Spring has sprung! This is the best time of year to purchase a home. Get settled in time to enjoy the summer months and be ready for the new school year!

We have received many inquiries regarding the specifics of the first time home buyer tax credit. The following information will give you a broad overview. If after reviewing this you have further questions, please consult  with your professional tax provider.

• The tax credit is for first-time home buyers only. A first time home buyer is defined as a buyer who has not owned a principal residence home in the past three years. If a couple is married and one of the spouses has owned a principal residence within the last three years, the couple is disqualified from the tax credit. However, unmarried joint purchasers may allocate the credit amount to any buyer who qualifies as a first time buyer. Ownership of a vacation or rental property not used as a principal residence does not disqualify a buyer as a first time home buyer.
• The tax credit pertains to the purchase of any kind of home, new or resale, that will be used as a principal residence, and has been purchased on or after January 1 2009 and before December 1, 2009 (the purchase date is the date when closing occurs and the title to the property transfers to the home owner).
• The tax credit does not need to be repaid. This is the most significant difference between this tax credit and the one Congress enacted in July 2008. Because it had to be repaid, the previous credit was in essence, an interest free loan. This tax incentive is a true tax credit. However, the home buyer must use the residence as a principal residence for at least 3 years or face recapture of the tax credit amount.
• The tax credit is equal to 10 percent of the homes purchase price up to a maximum of $8000.
• Single taxpayers with incomes up to $75,000 and married couples with incomes up to $150,000 qualify for the full tax credit. Individuals and couples whose income exceeds these limits may qualify for a partial tax credit.
• Claiming the tax credit is easy! Simply claim it on your federal income tax return and the money is refunded to you in your tax refund check.