Can 1st homebuyers rent back to seller for a few months after closing??
We are in negotiation with first time buyer on the sale of our home. They are under the impression that if we close on 7/1/09, they can not rent back to us for 2 monhts after the closing ( whihc is the time frame that our new home is available to us) be cause they would ooce the $8000 tax refund as 1 st tiume homebuyer? Is this true?
It seems strange since renting back to sellers is a common rela estate negototion to accommodate different close dates on each end....Please advise....
Hi K,
You are perfectly right on your second point that buyers may, and do, rent back to sellers after a close.
Yet, to qualify for the $8,000 First Time Homeowners Tax Credit, it is only eligible for buyers who use the property as their primary residence. As a real estate professional, f they were asking me, or many of us in the real estate profession, I/we would most likely be advising them to consult a professional Tax or Legal Advisor to double-check their eligibility if they should not want to move in right away and rent their new purcahse back to the party they are buying from in order to purchase their ideal new home that way.
Here's a link with lots of Q and A's on the topic.
http://www.federalhousingtaxcredit.com/2009/index.html
Good luck to you!
Ralph
if you take the $8000 tax credit you must agree to live in the house for 3 years. if you leave before then you must pay back the enitre amount.
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