The new law stipulates the following…

• Extends deadlines for purchasing and closing on a home.
• Authorizes the credit for long-time homeowners buying a replacement principal residence.
• Raises the income limitations for homeowners claiming the credit.

Basics under the new law…

Eligible taxpayer must buy, or enter into a binding contract to buy, a principal residence on or before April 30, 2010 and close on the home by June 30, 2010.

If you make the qualifying purchase in 2010, you have the option of claiming the credit on either your 2009 or 2010 return.

Long-time homeowners who buy a replacement principal residence may also claim a homebuyer credit of up to $6,500 (up to $3,250 for a married individual filing separately).

If you make more money, you may actually qualify now, as the new law extends the chance to folks with higher incomes. The new law raises the income limits for homes purchased after Nov. 6, 2009. The credit phases out for individual taxpayers with modified adjusted gross income (MAGI) between $125,000 and $145,000 or between $225,000 and $245,000 for joint filers. The existing MAGI phase-outs of $75,000 to $95,000 or $150,000 to $170,000 for joint filers still apply to purchases on or before Nov. 6, 2009.

See frequently asked questions about the first-time homebuyers tax credit.

Post from: Thrifty Mommy

NO house is perfect: Repeat this mantra like the waves on the ocean. There will never ever be a perfect house. Make a list of wants, needs, and bling wishes. If you find a home that meets at least most of the needs, some of the wants, and maybe one bling choice (i.e. you HAVE to have a tree in the front yard), is a good house. Settling for most of what you want is a good bet when buying a house. Waiting and waiting can cost you time and money.

Research neighborhoods first: Before looking for the house, look for an area. Find out as much as you can about the people in the neighborhood, the schools, and the other issues (shops, events, etc). Also if you think you’ll stay for a long while think ahead to make sure the home fits future needs, for example, is there a good middle school nearby?

Make a moving time line: Plan out the move / buy / market timeline. Know when your lease is up at your current place so you don’t end up finding a house way before you can actually move. Is the market in your area getting tighter or better?

For tons more money saving tips related to home buying visit the consumer info page at the Portland Metropolitan Association of Realtors (I know it’s a specific hometown, but the articles are actually nationally helpful).

[image via stock.xchng]

Post from: Thrifty Mommy

If you’re thinking you don’t need renter’s insurance because you have few valuables you’re most likely wrong. You don’t need gold statues to benefit. Renter’s insurance can be set up to cover electronics, clothing, albums, and more. Your whole clothing collection and your TV cost way more to replace than insurance will cost you.

What will a policy cover?:

Most of your home goods. A basic renter’s policy will not usually cover natural disasters like a major flood though. You’ll need to look into extra insurance for that. Talk to an insurance company to get an idea of what is and is not covered. It’s helpful if you create a good home inventory list before shopping for insurance because this list can help an insurance agent find you the best coverage for your needs.

How much does it cost?

I’ve had renter’s insurance at many different dwellings and it’s always averaged around $20-30 a month, although I know it can go as low as $15 a month. If you lose all your possessions in a home crisis, it’s going to cost you far more than that yearly fee of about $300. Plus you can get usually get a discount if you double up your insurance; for example, if you get auto and renter’s through the same company. You can also usually get discounts if your home has fire or burglar alarms, fire extinguishers, sprinkler systems, or deadbolts.

Of course discounts don’t always come easy so be sure to shop around.

What do you think? Do you have renter’s insurance? Why or why not…

Post from: Thrifty Mommy

That said, there are also some ways a home can cost you. Buying a home is not hands down, 100%, all the time the best idea for every person or situation. Here are some potential downsides of home owning that may cost you…

• Property values are never guaranteed to appreciate. A home can lose value for any number of reasons; recession, bad home ownership ethics (i.e. you let the home go), if your neighbors suck, and more. A home won’t guarantee later wealth for you.
• It’s expensive to get used to. Rent is normally cheaper than a mortgage. If you’re used to lower rent it can be a shock at first. On the up side, you may be bale to get some money back via tax benefits – but you’ll need to speak to a tax pro in order to assess your personal situation.
• You are responsible for EVERYTHING! Forget the days of calling your landlord to replace the dishwasher or fix a leaky toilet. If something breaks you’ve got to fix it. Worse, many issues must be fixed right away. If you let some stuff go, it can get worse, and cost more. Be prepared to set aside a maintenance budget.
• Selling can be a pain in the a**. Say you get terrible neighbors. Say you get a job transfer. Say you lose some income and can’t afford the mortgage. If you have to sell it’s going to cost you fees, updates, and probably time away from work and depending on when sell, the market could be good or bad. Selling is especially problematic when you need to sell right away.

What do you think? What are some other downsides of home ownership?

[image via stock.xchng]

Post from: Thrifty Mommy

The other day, I drove to a lovely little city in Western Maryland called Cumberland and spent a day exploring. I found homes in move in condition for under $75,000 and homes that needed a bit of work, but were pretty livable, for under $60,000. It is a really nice area with a lot of outdoor entertainment options (and a possible casino venue nearby if the slots come to Maryland.)

There are jobs for people in the medical industry and there are some blue collar employment options, but it looks like most people keep their jobs at the local colleges and schools forever, so I don’t think people in education would have a very good chance of finding a job in that field. If you have a career with Giant Foods, there is a Martin’s grocery store.

The people I met were very friendly and it seems like a nice place to raise kids, what with three great hiking opportunities within five minutes of the city.

Do you have an area near you that is affordable and safe? I think it would be awesome to help people who are open to relocation find a place that was cheap enough to allow them to fulfill their dream of owning a home without overextending themselves.

Post from: Thrifty Mommy