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Random questions from a first time home buyer
Hi ladies I am a lurker on here, but need some help. First my H and I have been the market to buy a house. Last Saturday we sound the one and it is a short sale. After almost a week of competition we are under contract. First off as far as our contract goes this lady and Rural Development excepted our price, but won't pay for anything. Such as home warranty, Radon testing and to fix radon if there is a problem. Also if something comes up in the inspection she won't pay for anything. Is this normal or should it be a red flag. SInce we are new to this process I just don't want people to think they can take advantage of us, since we are first time home buyers. This lady lost her job, so I can understand that she doesn't have any money.
Ok next are there any more tax credits for buying a home? Or any grants we would try to get? Also anything deductible we should keep in mind like fees, closing cost etc? I really wish I could find a website with a list of all the things that could be deductible in the home buy process. Any and all advice is great.
Re: Random questions from a first time home buyer
Yep, it's a short sale which means that the seller is getting no money from it and probably can't afford the repairs. It's normal for the buyer to pay for the radon test. You can decide to walk away or try to negotiate the price down, but they probably aren't going to fix anything.
I think the federal tax credits are gone (though you'll get a very nice deduction from closing costs and all that jazz). I second the pp on asking your realtor about local ones. In our area there is a $10K grant for first time homebuyers who make below a certain percentage of the median income for the area. I think there is a class involved and a lot of paperwork. If something like that exists in your area, your agent should definitely know about it.
Generally the only tax deductible items from closing are prepaid interest, upfront PMI(there are some exceptions to this as well),, and points if you pay them to lower your interest rate. Other than that most items are NOT tax deductible. Of course your monthly interest, PMI, and property taxes are deductible as well.
I can't help with the short sale, but congrats on finding a house you love!!
The tax deductions are as PP's said, your prepaid interest, some closing costs and fees for getting the mortgage. This IRS publication might be helpful http://www.irs.gov/publications/p530/ar02.html