Boise First Time Home Buyers Leverage Tax Credit

Once again, it is time to remind all Idaho first time home buyers that have NOT taken advantage of this free money gift, that the time is running out. Even though there is much talk about extending the tax credit, don’t count on it. The loan has to be CLOSED by November 30th in order to qualify.

One way to leverage the $8,000 tax credit, is to increase the down payment. If a Idaho first time home buyer were to buy a $100,000 home, for example, they could put down the whole $8,000 instead of the traditional 3.5% ($3,500). That would reduce the loan amount on the first mortgage and lower their mortgage payment approximately $30.00. Remember every little bit helps!

A second way to capitalize on this great offer, would be to pay off some consumer debt. Back to the 100k example, a first time buyer could put down the regular 3.5% ($3,500) and use the remaining $4,500 to pay off a car loan. Imagine that, no car payment. How empowering. Now the new home owner can take it to the next level by leveraging the monthly car payment and applying it to other debt. That extra monthly savings can also be applied towards the new mortgage. If a home owner were to make one extra payment a year, a 30 year fixed would be reduced to a 22 year loan. That difference could save a home owner 30-40 thousand in finance charges. Saving money and leveraging limited income is the key to financial success.

And yet another way to leverage the $8,000 tax credit is to contact a local H & R Block tax professional and have 2008 tax returns amended. That would put the cash in a new home owner’s hand in a few weeks, instead of waiting until next spring.

Always consult a tax professional regarding the $8,000 tax credit! Everyone’s tax situation is different.

When is comes to financial responsibility, home buyers need to take control. Set up a Personal Budget and don’t live beyond your means.

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