My wife and I decided that since my daughter has moved out of the house into her own apartment and my son will be moving out in the next year that it was time to downsize our home. The other main advantage right now of doing this is to get the 6500 dollars home buyer tax credit.
We currently have a 3658 square foot home. We absolutely love our house but for just the wife and I, 5 bedrooms and 2 1/2 baths with all of this space is a bit much. So we decided to put this great house up for sale. We priced it very reasonably for the current market and will still walk out with some equity. We will apply this equity to a home that is actually 1543 square feet. It is also a great pool home, but is the right size for life going forward.
Right now interest rates are fantastic which also makes it a great time to buy or sell. When you sell, someone buying your house can get a much lower payment. We locked in on a 5.25% with zero points for 30 year fixed rate loan. We will only be borrowing a little over 100K. The plan is to pay at a rate that will get this house paid off in 5 years. This is our goal to be completely debt free in 5 years.
You may be asking OK Steve, thanks for sharing your plan. But how to get or qualify for the 6500 dollar home buyer tax credit is the real question. OK, for current home owner you must have lived in your house over 5 years, have a signed contract by April 30th, 2010. You must close by the end of June 2010.
There is also a stipulation in regard to your income. You must not make over $125,000 if single or over $250,000 if married. The price of the home also cannot exceed $800,000 that you are going to buy.
So we basically qualify this year because we made under $250,000 being married, the house we are buying is actually under $200,000 and we have lived in our current home going on 7 years. We are looking forward to getting the $6500 tax credit and will use it to update a couple items in the home that will finish it off nicely. We are going to put new carpeting in the living room and dining room. We are going to install Granite Counter tops in the Kitchen with a new sink and faucet. We will also do some painting to make it feel more like ours. But other than that the new smaller house is perfect and are really excited about moving in.
So if you have been thinking of down sizing or changing homes this is how to get the 6500 dollar home tax credit.
