Lawton_The sour news of the national mortgage crisis just got a little sweeter. In an attempt to boost the sluggish housing market and get people into homes across the United States, Congress passed the "Housing and Economic Recovery Act" last week, giving first-time homebuyers a federal tax credit of up to $7,500. The legislators' goal is to maximize the stimulus for the housing market and economy, help stabilize home prices, and increase sales.
Since Lawton is one of the few cities across the country that's growing during the threat of a national recession, new homes are being built in preparation for the 10,000 people expected to relocate over the next few years with the Base Closure and Realignment (BRAC). Now, getting new people into new homes will be a little cheaper.
A single homebuyer earning less than $75,000 per year, or a married couple earning less than $150,000 per year, will be eligible for the full $7,500 tax credit. "We're going to take advantage of what's going on, as far as things being bad in other parts of the country - Florida, California," said Steve Barnes with the Lawton Homebuilders Association. "But, again, our economy here is strong. We don't have much as far as inventory, so it will help us sell a lot of homes - especially at this time, with BRAC coming in. So the timing couldn't be better."
Even if a homebuyer has owned a home in the past, he or she will still be considered a first-time homebuyer if a home hasn't been purchased in the last three years. "We're ready, we've got plenty of lots coming on, prices are going to go up," said Barnes. "There's no time like the present - and right now is it."
However, the tax credit must be paid. Homebuyers will be required to pay the credit to the government, with no interest, over 15 years, or after the house is sold with sufficient capital gain. "Anytime you can give someone $7,500 - interest free, pay back in 15 years - it's wonderful," said Barnes. "It's not a government giveaway, though. You know, a person will have to pay it back. "But, at those terms, it's wonderful."
The tax credit applies to any new homebuyer who will use a newly purchased home as their primary residence. Any home - new or old - qualifies, including single-family homes, townhouses, and condominiums. This tax credit is not the same as a "tax deduction." A tax credit is a dollar-for-dollar reduction in what a taxpayer owes, which means that a taxpayer who owes $7,500 in income taxes, who receives a $7,500 tax credit, would owe nothing to the Internal Revenue Service. If you have any questions, visit the Lawton Homebuilders' Association website at www.lawtonhomebuilders.com.
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