President signs new law giving $7,500 tax credit to first time home buyers
WASHINGTON, DC (7/30/2008) -- President Bush signed into law the Housing and Economic Stimulus Act of 2008, a sweeping housing bill passed by Congress to revitalize the mortgage and real estate markets, in part by offering a $7,500 tax credit to first time home buyers.
The tax credit is structured as follows:
- Available to first time home buyers only
- Limited to 10% of the purchase of the home or $7,500, whichever is less
- You must earn less than $75,000 per year as an individual, or $150,000 if married and filing jointly
- You must be buying a primary residence (i.e. no second homes or investment properties qualify)
- The tax credit is recaptured over a period of 15 years, during which interest of 6.66% is added to the tax credit amount
- Applies to home purchases that take place between April 9, 2008 and
July 1, 2009
The tax credit is structured to resemble a 15-year loan of up to $7,500, designed to help first time home buyers purchase their new homes.