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Old 05-10-2011, 03:55 PM
 
2,311 posts, read 3,506,319 times
Reputation: 1223

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How fitting ...
2010 Tax Credit for New Home / First-Time Buyer


How the $8,000 Tax Credit Cost Home Buyers $15,000 - SmartMoney.com

In net, it was a pretty worthless waste of tax revenue ...
Home prices were set to decline and that trend hasn't stopped..
Yes, a bunch of people were convinced to jump on a falling knife....

In providing a tax credit, prices were given a support.. thus, money was transfered from the home buyer to the seller ...

$100 million pissed down the drain and the home buyer generally screwed more.
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Old 05-10-2011, 05:20 PM
 
2,093 posts, read 4,698,944 times
Reputation: 1121
Quote:
Originally Posted by yeahthatguy View Post
How fitting ...
2010 Tax Credit for New Home / First-Time Buyer


How the $8,000 Tax Credit Cost Home Buyers $15,000 - SmartMoney.com

In net, it was a pretty worthless waste of tax revenue ...
Home prices were set to decline and that trend hasn't stopped..
Yes, a bunch of people were convinced to jump on a falling knife....

In providing a tax credit, prices were given a support.. thus, money was transfered from the home buyer to the seller ...

$100 million pissed down the drain and the home buyer generally screwed more.

The article makes some good points. However, the blame rests with the home buyers who are just as guilty for pulling the trigger to purchase a home to receive the 8,000 tax credit handed out by the government. Had they crunched the numbers and did the math before pulling the trigger, they wouldn't be suckered into the program, unlike me. For example...

When I bought a home last year, I took advantage of the first home buyer credit (anyone would be an idiot not to take advantage of it). Once I received my Federal 8,000 tax credit, half of that amount when to paying my personal property tax this year. The other half will go into next year's property taxes.

I also took advantage of the 10,000 tax credit provided by the state of California and now I owe the state nothing for the next 2 years when I file my state taxes.

So, I got even with the Federal and state governments. But that is only short lived. On the other hand, I'm very fiscal with my budget and I've ensured minimal loss when it comes to home value. No big gains but no big loss either. I just have a roof over my head without losing my money to a landlord's pocket.
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Old 05-10-2011, 09:54 PM
 
880 posts, read 1,800,394 times
Reputation: 770
The biggest joke is how 1,200 prison inmates got in on it.

Nearly $30 million stolen from Homebuyer Credit: report - Jun. 23, 2010
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Old 05-11-2011, 12:46 AM
 
2,311 posts, read 3,506,319 times
Reputation: 1223
Quote:
Originally Posted by Hwy phantom View Post
The biggest joke is how 1,200 prison inmates got in on it.

Nearly $30 million stolen from Homebuyer Credit: report - Jun. 23, 2010
Reminds me of the same way illegal immigrants get into the country and manage to stay here ... with even the biggest idiot being able to define methods for identifying them.. govt. is reckless w/ its money and power because it flows so freely ... Govt. is a joke and most often the things they spend money on are too .. the loopholes gaping wide... namely because the expenditure was stupid in the first place and not thought out.. o' this would look great for re-election.. yeah, go right ahead johny... *approved
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Old 05-11-2011, 10:16 AM
 
Location: USA
79 posts, read 174,136 times
Reputation: 70
Tax credit only applies to homes used as a taxpayer's principal residence.
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Old 05-11-2011, 01:57 PM
 
2,311 posts, read 3,506,319 times
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Quote:
Originally Posted by Carla Hailey View Post
Tax credit only applies to homes used as a taxpayer's principal residence.
I think that is implied by 'first time home buyer'
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Old 05-11-2011, 03:01 PM
 
Location: SW MO
23,593 posts, read 37,484,310 times
Reputation: 29337
Quote:
Originally Posted by yeahthatguy View Post
I think that is implied by 'first time home buyer'
Interesting. We qualified and used the credit. My wife had never owned a home and I hadn't for awhile so we were able to take advantage of it. It certainly didn't put us at risk and our home has, at the least, maintained its value and likely increased. We purposely purchased one that resulted in a mortgage we could easily sustain in good times or bad, even with our post-retirement, "fixed" incomes. Sorry about those who over-extended.

Isn't that what caused the bubble in the first place? Thankfully, we're not that dumb!
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Old 05-11-2011, 03:46 PM
 
2,093 posts, read 4,698,944 times
Reputation: 1121
Quote:
Originally Posted by Curmudgeon View Post
Interesting. We qualified and used the credit. My wife had never owned a home and I hadn't for awhile so we were able to take advantage of it. It certainly didn't put us at risk and our home has, at the least, maintained its value and likely increased. We purposely purchased one that resulted in a mortgage we could easily sustain in good times or bad, even with our post-retirement, "fixed" incomes. Sorry about those who over-extended.

Isn't that what caused the bubble in the first place? Thankfully, we're not that dumb!
Those who really benefited from the program are the ones who take in account the worst scenarios should they commit to purchasing a home; just as I was saying earlier in the thread. You buy a house because you need a house to dwell in, and to save on rent cost over the long term.
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Old 05-11-2011, 09:48 PM
 
Location: SW MO
23,593 posts, read 37,484,310 times
Reputation: 29337
Quote:
Originally Posted by TimC2462 View Post
Those who really benefited from the program are the ones who take in account the worst scenarios should they commit to purchasing a home; just as I was saying earlier in the thread. You buy a house because you need a house to dwell in, and to save on rent cost over the long term.
Very true! From the very beginning we considered it our home, not an investment. The uopgrades we've done and continue to do are for us, not some future buyer after we assume room temperature.
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Old 05-11-2011, 10:44 PM
 
5,113 posts, read 5,973,187 times
Reputation: 1748
Here is something to think about:

If you wanted to purchase a $750K home, and get a $600K, 30 year, 0 points, fixed rate loan at 4.875% (4.925% APR), impound account, you would have to come up with ~$158K closing cost, your monthly payment would be ~$3,200 per month and over the life of the loan, 360 months, you would have paid ~$1.4 million and that’s not counting maintenance over 30 years which could easily run you over $200K which brings the total to ~$1.6 million.

Compare that to a person who rents a $1,500 per month apartment/house will pay $540K over the same 30 years and have to come up with basically nothing to start and can move whenever they wish.

That difference is over a million bucks. I’m over 50 so in 30 years I will be over 80.
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