Washington is now pushing for a $7,000 tax credit for people who buy a home that is in foreclosure. People who buy a foreclosed home would get a $3,500 credit this year (2008) and another $3,500 next year (2009.)
I get it that the point is to help reduce the glut of foreclosed homes currently on the market, but I also see a huge downside to people who are selling their homes BEFORE they reach foreclosure. It's like adding $7,000 to the price of these houses and makes them much less appealing to buyers.
Full disclosure: I am one of those people who has been making payments on time, who put thousands of $$$ into improving my home to help it sell, and now the houses up for sale by those who haven't paid a dime in 6 months or more are suddenly being given a HUGE advantage. I feel like we are being punished for doing the right thing and being responsible. It is especially upsetting because much of this problem was caused by 'speculators' who wanted to make a quick buck by 'flipping' houses, and instead just drove up the market until the bubble finally burst.
I feel bad for people who have lost their homes, but it's not like we have deep pockets and can take still another $7,000 off our already devalued house to compete with the foreclosures. We're using our family savings just to get by, but nothing is being done to help people like us. I don't even WANT government help, really, I just don't want to be put at a disadvantage --- especially since they are using MY tax dollars to do this.
Does anyone else have thoughts on this --- either for or against the $7,000 credit?
I don't think it's fair at
I don't think it's fair at all. I had to take my house off of the market late last year because my house was making all of the foreclosure homes look better price wise. People would come look, no bites EVER. And my house is pretty nice. Now since it's dropped even more in value I'm upside down. Should be interesting when or if I can refinance in a few years to get out of my 5 year arm.
Lisa - Mom to her spunky little Scarlette
I think the government is
I think the government is trying to fix a problem. I have a close friend who purchased a home a few years ago. It's in a nice, gated community, community pool, etc. Fast forward 3 years, and now over half the homes on her block are forclosed. Most of those homes are empty. Often those who choose not to forclose the home "rent" it out and they don't always get the best renters into the homes.
The lawns are never mowed, the frount yards are trashed, and the tentants don't care. Neither do the landlords, as long as they get their rent check that month.~ And there is nothing the HOA can do about it.
Why should she get punished when she is the one making her payments? I think the government is trying to "fix" the communities by offering incentives for forclosed homes.
I agree, foreclosures are
I agree, foreclosures are owned buy the banks, so it would be giving the banks an unfair advantage over homeowners that need to sell their homes as well! Why should banks get tax dollars contributed to their homes? The banks should be held accountable for their bad business choices that are negatively impacting all of us.
Angela
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