• The deduction is worth 10 percent of a home’s value up to $8,000, which means all homes worth more than $80,000 could qualify for the maximum amount.

• There is an income limit to qualify. A married couples’ modified adjusted gross income (MAGI) should be under $150,000 and single filers’ MAGI should be less than $75,000.

• Partial tax credits may be available for married couples with MAGI incomes over $150,000 but under $170,000, and single filers with incomes over $75,000 but under $95,000.

• If married couples file separately, they can both claim 5 percent of the home purchase ($4,000 each for a home over $80,000) on their tax returns.

• It’s a tax credit, not a deduction. That means the entire amount goes back to the first-time homebuyer unlike deductions, such as mortgage interest, that are subtracted from gross income before tax is calculated. If qualified for $8,000, the buyer gets $8,000, even if they would not owe that much in taxes otherwise.

• The tax credit applies to homes purchased between Jan. 1, 2009, and Dec. 1, 2009.

• The tax credit does not have to be paid back, providing the homebuyer keeps the property for at least 36 months and resides in the home.

• To qualify as a first-time homebuyer, the purchaser cannot have owned a home within the previous three-year period. However, ownership of a vacation home or rental home does not disqualify the buyer.

• If purchasing a new home, the effective date to receive the credit is the first day the homeowner actually lives in the house. If construction began in 2008, that buyer could still qualify. And if construction begins in 2009 but the owner does not take possession until 2010, the buyer would not qualify.

• The tax credit can be claimed on 2008 income tax forms even though the purchase took place in 2009. A buyer could close on a home the same day that President Obama signs it into law, fill out their income tax forms the next day, and receive the tax credit fairly quickly.

The tax credit is not a downpayment, but it could be used toward a downpayment if first-time homebuyers plan ahead. U.S. taxpayers have money withheld from every paycheck for income taxes. If they owe more tax than the amount deducted, they pay the IRS; if they owe less, they get a tax refund.

By anticipating at least an $8,000 refund in early 2010 when they file 2009 taxes, these buyers could cut down on their tax withholding this year and save the money toward a downpayment. There is one caveat, however: Should they not buy a home in the qualifying period, they would still owe the IRS the money, and reducing their withholding amount could result in a high bill at tax time.

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Many people talk about secured credit cards. We don’t like them. Why? There are better ways:

The way to go is the so called American Express “Global card transfer program”.

 You have to be an American Express cardholder in your home country (otherwise you should join immediately). You call the US global card transfer center at 1-800-453-2639 (North America) or 01-801-945-2048 (International) 7:00 am – 5:00 pm (MDT).

HINT: Check out which card you want to take before you call! The information on the phone can be very complicated, and you only have 1 choice (you can apply for other cards through the regular ways later, but you can only transfer 1 card).

What they do is they use the internal “AMEX credit report” from your home country and transfer to the AMEX credit report at your destination country. This works worldwide where American Express cards are available (not only for the US). You don’t have to have a SSN in order to transfer your card to the US. However, if you have one it’s even better for you.

For more info: American Express Global Transfer Program

By using the American Express Global Transfer Program you will get a relative high credit line from Amex into your local credit report, your credit worthiness will grow really fast. A SSN will help to make sure that the Amex credit report is assigned to the right person when reported to the nationwide credit agencies (Transunion, Experian, Equifax).

Hope this helps!

Axel

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1. Check for and correct errors in your credit report.

2. Pay down credit card bills.

3. Don´t charge your credit cards to the maximum limit.

4. Don´t purchase expensive items e.g. furniture for your new home on credit cards until the loan is approved. The amounts will add to your debt.

5. Don´t open new credit card accounts before applying for a mortgage. This will also lower your credit score.