At the end of April (when the tax credits expired) the interest rate was hovering around 6%.you would have spent much more than the $8000 Tax Credit for 1st-Time Homebuyers – many times over!

My friend Rob Levy, a top-producing agent from Portland, OR (and a fellow member of the CyberProfessionals) shared a great article he wrote on the impact of lower interest rates on the housing market.   I liked his approach and it prompted me to write this post.  I added and changed some information and details to reflect our housing market on Long Island.  The examples given do not include property taxes – only principal and interest.  You would need to add the monthly cost of property taxes for any particular home to the monthly principal and interest to know what your total monthly payment would be.

Is now a good time to buy a home?  Even if prices drop some more?  Consider this – If you buy a home for $400,000, and for this illustration obtained a $400,000 mortgage for the property – and that home drops 10% the next year – you lost $40,000.   Easy enough to figure.  But if the mortgage you obtain today cost 4.25% and the one available in a year cost 6 % – then the difference in the total cost of that home is a lot less if you purchase a home now.  $400,000 @ 4.25% = Monthly Payment of $1,967.76 vs. $400,000 @6% = monthly payment of  $2,398.20 – for a difference of $430.44 – Each and Every Month!  For a 30-year mortgage that difference in the finance charge adds up to $154,960.74.  And one thing is a “given” – when the economy improves, interest rates will rise.

And what about the “Housing Tax Credits” which expired April 30?  Did you mess up by not taking advantage of that opportunity?  Not really.  About that time in April interest rates were hovering around 6%.  The Cost of the Home – even with the tax credits – would have cost more in April than today with the historically low interest rates available. 

Despite what you’ve heard, homes are selling – and this is a great time to buy a home.  The bottom line is “How much is it going to COST to Pay for the home?”  It’s not just the purchase price that has to be considered – but the total cost of paying for it, and for most buyers that means the cost of financing a home.  Check out the financial calculators on my website to do your own estimates.

For more information – or any questions Contact Cheryl at cheryl@liagent.com or 631-493-0542.  Search the MLS for all homes available on Long Island at www.LIagent.com.

Video from the IRS provides information about the new First-Time Homebuyer Tax Credit and how it can benefit you.  The law went into effect Nov. 6 and it extends the first-time homebuyer credit to April 30, 2010 (must be in contract by that date and contract closed by June 30, 2010). Eligibility requirements for purchasers are expanded.

There’s more information about the requirements and how some current long-term homeowners also can use a Tax Credit of $6,500 for the purchase of another home in an article from the IRS website. 

Start your search for a new home at www.LIagent.com.  Click on the map to search for all homes for sale on the LI MLS. Or use the quick search form on the upper right sidebar.  Contact us at CGTeam@CherylGrossman.com.

 President Obama signed into law today an extension and expansion of the homebuyer tax credit.  The $8,000 First-Time Homebuyer Tax Credit is extended until April 30, 2010.  Buyers must be in contract by that date – but have until June 30 to close.  Current homeowners who have lived in their home for 5 years can receive a $6,500 tax credit when they purchase another home.  Income levels have been raised to $125,000 for single buyers and $225,000 for couples.  The purchase price of the home cannot exceed $800,000.  There are requirements and limitations.  The National Association of Realtors (NAR) published a chart which list the stipulations -  NAR Tax Credit Brief.

These new guidelines will help many buyers on Long Island.  All combined - the tax credits, reduced home prices, and historically low interest rates make the total cost of buying a home now the lowest it’s been in years - creating an incredible opportunity for you and your family.

Start your search now at www.LIagent.com or use the Quick MLS Search on the upper right sidebar.  Call us at 631-493-0542 or CGTeam@CherylGrossman.com.

There are a couple of First-Time Homebuyer Assistance Programs available for local  residents.

For Huntington residents wishing to purchase a home in the Town of Huntington, the Town has a great program for First-Time Homebuyers called the “Huntington American Dream Homebuyers Assistance Program” which matches funds for a down-payment.  There are eligibility and income requirements and the purchase price of the home cannot exceed $396,150.  For more information and to request an application contact the TOH Community Development Agency at 631-351-2881.  Huntington American Dream Homebuyer Assistance Program.

Although it’s over for this year, there is a Suffolk County Down Payment Assistance Program for First-Time Homebuyers which will start up again next May.  I’ll post information about that program next Spring.

The State of New York has several programs for First-Time Homebuyers which include such benefits as below-market interest rates, financing up to 97%, new construction incentives, financing for remodeling an existing home, programs for military veterans and more.  All are designed to make the home purchase more affordable for low and moderate income families.  The easiest way to see if you qualify for one of these SONYMA programs is to go to their website.

To find out more information about these homes, click on a photo.

Any Questions?  Want to arrange an appointment to view any home, please contact me at Team@CherylGrossman.com or call 631-223-8549.  More homes at www.LIagent.com

First-Time Homebuyers can benefit from two new programs in the Town of Huntington unveiled today.    These two programs are funded by the Town’s Affordable Housing Trust Fund – using money that developers paid into the trust fund in return for obtaining increased density for their projects.  (Most of the funding came from the developers of The Greens.)   “Helping people, especially people just entering the workforce, find housing they can afford will help ensure the Town’s future by addressing one of the major factors cited as contributing to Long Island’s brain drain. I can think of no more important role government can play,” Supervisor Petrone said.

The two programs for First-Time Homebuyers to be implemented are:

The “American Dream” program, which will help first-time buyers realize the American dream of home ownership by providing 50 percent of their down payment, up to a maximum of $15,000. The town has earmarked $600,000 from the housing trust fund for this program, which is open to people making no more than 120 percent of the median income in the town. On a sliding scale, that works out to $85,600 for an individual or $122,200 for a family of four. The maximum purchase price of the house is $396,150.

The “Take Back the Blocks” program, which will make available to first-time buyers houses the town has purchased from absentee landlords and rehabilitated to include a primary residence and a legal accessory apartment. The projected income from the apartment will help buyers qualify for a mortgage and meet carrying costs. The Town has allocated $429,000 in housing trust fund money to help purchase properties on Columbia and Tower Streets, which will be converted to a total of 16 living units. Other funding for this program is coming from Suffolk County and from the State’s Restore NY Communities program. This program is open to people making 80 percent of the median income, or $57,000 for an individual and $81,450 for a family of four on the sliding scale.