What Is First Time Home Buyer Tax Credit

The first time home buyer tax credit is a refundable federal tax credit for homebuyers who have not owned a home within the past three years

. The first time home buyer tax credit is an interest-free loan from the federal government that must be repaid in equal instalments over 15 years. The 2008 tax credits may have to be repaid. For the 2009 and 2010 tax credits, you may not have to repay the credit as long as you own and live in the home as your principal residence for at least three years.

As a home buyer you may qualify for the tax credits,

If you have owned and lived in your principal residence for at least three years.

If you had bought the residence on or after April 9, 2008.

If you had signed a binding sales contract before May 1, 2010, and closed no later than September 30, 2010.

If you do not meet any of the conditions defined on page two of the IRS document.

If you meet the income guidelines.

Before deciding on any loan, a research on home finance may help you get the one that best suits your needs. There are many online services provided by various companies which can help you with all of your home finance needs. You can find online libraries with finance articles that may have the information on mortgage rates, mortgage lenders, the best mortgage loans, mortgage calculators and online counseling. It may be a good idea to make use of the available information about home finance before deciding on any particular option.

A first time home buyer may have several questions on home mortgage. A mortgage is a legal written statement signed by the lender and borrower to use the property as security for the repayment of a loan. The property you purchase is the collateral for the mortgage. If you fail to make payments on the loan, the lender can obtain the home through what is called foreclosure, meaning the forced sale of a home or property that is pledged as security against a mortgage.Some interesting facts about mortgages are as follows:

They are usually offered as 15 or 30 year loans with an interest rate.

The interest rate is a percentage of the loan the borrower must pay to the lender, in addition to the monthly payment, for lending them the money.

There are generally two types of rates, fixed and adjustable rates.

Fixed rate loans have unchanged rates throughout the term of the loan.

Adjustable rate loans have rates that can change based on the current market indices.

For a mortgage to be approved, you may need good credit scores.

Lenders use a credit check procedure to determine if you will be able to repay your loan.

A positive credit history generally helps in loan approval.

Knowing the secret to get the best mortgage rate will help you find the right loan.

by: Ask Bill

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