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$7,500 1st Time Home Buyer Tax Credit
By admin | January 13, 2009
I got an e-mail about this and wanted to share some thoughts.
This is very topical considering yesterday afternoon I just signed the papers to put a contract on my first house. The Kakaras family is very excited but I still have much work to do shopping around and locking in my mortgage.
Anyway, basically if you are a first time home buyer and purchase your home between I think like April 2008 and April 2009 you get to make an election (on your 08 tax return) to receive $7,500. However, this must be paid back within 15 years.
Here is an article on it that was sent to me:
http://digits.hrblock.com/
The purpose of this is to stimulate the housing economy with a $7,500 interest free loan. I have heard of many programs in the past and never get excited at things like this. I by no means am saying its a bad thing. But I think it is more of a neutral thing than it is a good thing. If it were free money you better believe I would be pushing this thing like crazy (thats a no brainer).
But always my fear with debt is it tricks people to spending money that they don’t have. You cannot tell me that isn’t true considering the shape the most Americans are in. Record high in foreclosures. Record high in bankruptcies.
I am not sure if I would recommend to make the election or not to people. Yes, it is an interest free loan which you can’t get anywhere. However, there is a danger with people ending up blowing it and you are stuck paying it back and find yourself in a tough situation.
My instinct would be to put it in a money market and leave it for a while but I have been told by others that this would be unethical. So, I may just say pass on it…
Topics: Debt |
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