The state of California has extended and enhanced the $10,000 tax credit for home buyers in California. The tax credit used to only be for brand new built homes, now the tax credit includes ALL first time home buyers buying ANY type of home, new or resale. This is great news those who first time home buyers who intend to get FHA loan to purchase their first primary residence home in California.
This credit is set to go into effect May 1st 2010 just as the $8,000 federal tax credit expires April 31st 2010. And the California tax credit will be available through August of 2011. The credit is 5% of the homes purchase price with a limit of $10,000. So to get the full $10,000, you would have to purchase a home for at least $200,000.
The way tax credits work is if you paid state taxes, you can get a refund for those taxes up to $10,000. So yes you will get a check for $10,000 if you fit into this program and you paid $10,000 in state taxes. If it works like the federal tax credit, you will be able to amend you 2009 returns and get the credit for 2009, or take the credit in 2010.
FHA is the preferred financing of first time home buyers (the major recipients of the California home buyer tax credit) because of the minimum down payment of 3.5% (which can be a gift from a relative), flexible qualifying guidelines and still terrific interest rates.
And here are some additional highlights to remember about FHA loans:
- To get a FHA loan credit score does not have to be perfect
- FHA loan interest rates are at historic lows
- You can use gift funds for FHA loan down payment
- Maximum FHA loan is $729,750, so you can get a FHA loan in expensive parts of California like Los Angeles, San Jose, San Francisco and San Diego
- Debt-to-income ratios on FHA loans are allowed up to 55% where conventional loans require 41% with less than 20% down
Give me a call (858-922-7899) or email (homeloan8@gmail.com) if you have any questions at all about getting approved for a FHA Loan.
Warmest Regards,
Rob Chomentowski
Sr. Loan Officer (and FHA specialist)
858-922-7899
Update on New California Home Buyer Tax Credit - Perfect For Those Who Qualify FHA Loan
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