Hi! Just received a message that our application for 10K tax credit was denied on because <deleted mortgage company name> faxed the application 1 day late. Do we have any recourse in this situation? Thoughts?

My response was this:

Dear Mr. X:

Not that I am aware of.

If this were me, I would call <deleted mortgage company name> and ask to speak with a manager about the situation.

I think that your only chance of any kind of “remedy” is to get high enough at <deleted mortgage company name> and get someone to listen to you and see what happened.

From the sounds of it, <deleted mortgage company name> is at fault and whoever “messes up” should “fess up” and fix it.

I would be happy to be a sounding board for you and give you advice as needed… but I worry that it is going to be a bad situation all around and no one will own up to it.

Keep me posted… if you want!

If you think you are eligible for the California 10000 new home tax credit, make sure that you are not late on turning in your application. It is a first come, first serve basis and also has strict timing requirements of what documents that you have to submit by when.

California 10000 New Home Tax Credit: How To Apply

The problem is that many of the typical first time home buyers (age 20-30) are having a tough time finding a job in California. Unemployment in California is currently hovering around 11 percent and that number is expected to creep up through the end of 2009.

From the LA Times:

Although the often volatile unemployment rate dropped to 11% from March’s 11.2%, the Golden State still lost 63,700 jobs during the month. The number of people seeking work has swelled by 842,800 from a year ago, the state Employment Development Department reported Friday.

Economists predict that jobs will continue to disappear for at least the rest of the year. “The unemployment rate will creep up,” said Esmael Adibi, an economist at Chapman University in Orange. “During the summer months, there is a jump in the labor force mainly because of new college graduates or students seeking temporary positions. Clearly, there would not be that many jobs.”
The grim job market — the worst in almost half a century — has put a damper on the graduation season celebrations of students such as UCLA English major Rachel Beezy.

“I’m doing my very best to stay optimistic, but I’m in the same boat as everyone else,” Beezy said. “It’s a horrible time to graduate.”

Before the recession sank its claws in her dreams, the 28-year-old Van Nuys resident hoped to make a career in film production.

So far, she’s sent out 20 resumes without getting a concrete response.
Now, Beezy said, she’d be willing to go back to the retail management job she held before college. Even a $10-an-hour internship would sound attractive.
Campus career center directors and recruiters agree that they’ve never seen competition as tough as it is this spring.

“It’s unprecedented. We see fewer and fewer firms coming to hire graduating students,” said Gary Greener, associate dean for career services at Southwestern School of Law in Los Angeles.

In a normal year about 600 employers come to interview juniors and seniors at USC, said Eileen Kohan, who runs the Career Planning and Placement Center, but recruiting efforts are down about 30%.

“Every firm that has laid off people in the past year didn’t come,” she said. “It’s been an incredibly difficult year.”

State data bear out Kohan’s observations. In March, nearly one in seven job seekers between the ages of 20 and 24 — many of whom are high school and college graduates — were unemployed.

That’s up 40% from a year earlier, and unemployment among people of all ages with bachelor’s or advanced degrees increased by 50%.

The outlook is even worse for teenagers graduating with high school or general educational development diplomas. Unemployment among 16- to 19-year-olds hit 26.2% in March, up from 18.7% a year earlier.

While it is a great time to be a first time home buyer because of the California 8000 tax credit, the 10000 California tax credit and the soon to be announced FHA bridge loan program, it is only a good time to buy a home if you have a job.

And jobs aren’t as plentiful in California as they have been in recent years.

Yes.

And it is starting to hit the national media scene that this is a great deal for California home buyers.

From the Seattle Times: buyers in California will benefit from both the new monetization of the 8000 tax credit and be able to also use the 10000 California tax credit if they qualify.

Bob Rivinius, president and CEO of the California Building Industry Association, said the new FHA credit monetization program “should provide a great combination” with the California credit.

Some first-time purchasers using FHA loans could even qualify for what he called “a trifecta”: They could buy their new house and claim the 10 percent state credit. On top of that they could file for the $8,000 federal tax credit, and then turn the federal credit into instant cash for use on a down payment or for closing costs.

Rivinius said funding for the state tax credit is being depleted fast, but legislation is now pending in Sacramento that would add another $200 million — and that “should allow buyers to receive credits” through the end of the year. The federal $8,000 credit only covers purchases closed by Nov. 30. Unless Congress extends the credit, it will disappear Dec. 1.

Also from the article:

The new bridge loans and cash-advance features of the federal credit may not be available immediately through private lenders, say mortgage-industry leaders. Among the key questions yet to be answered: Where will nondepository mortgage companies get the $8,000 in advance money to provide upfront to buyers?

Although most major banks offer second mortgage programs, the FHA guidelines stipulate that the tax-credit advances cannot be secured by a lien on the property, but only by the tax credit to be received by the purchaser.

Many mortgage companies, which do not have banking deposits to tap, will need a few weeks to prepare documentation for what will essentially be secured personal loans. Plus they’ll need to locate a source of funds for their advances.

In the meantime, however, would-be buyers who believe they are eligible for the federal credit shouldn’t sit around. They should shift into high-gear shopping for a house — the Cinderella date of Nov. 30 is looming — even if they’ll need a bridge loan or cash advance to complete the deal.

HUD has not released the final details of the 8000 tax credit “monetization” plan yet, and as more information becomes available about the short term tax credit down payment bridge loan — or whatever it ends up being, we will be sure to keep you updated.

Doing your research before hand to make sure that you will actually qualify and get the credit?

Good thinking. Something like this doesn’t come around just every day.

There are three ways that you can end up not getting the California new home 10000 tax credit:

1. You can buy a home that has been previously occupied.
2. You didn’t turn in your application within one week from close of escrow.
3. The application is received after the one-hundred-million-dollars that was allocated for the tax credit program has been allocated already — translation: you were too late.

Are there are any other ways that you can miss out on the California new home 10000 tax credit?

Not according to the FTB website.

That is the good news. The bad news is that as of May 13, the FTB has received  6,162 applications for $ 59,579,591 that have yet to be processed.

They are just a little backed up.

Remember: the 10000 California tax credit is on first-come, first-serve basis.

What this means to you is that if you are going to “get in line” for the California 10000 tax credit, you had better hurry.

10000 California Tax Credit: How To Apply

Here is how to apply for the 10000 California Tax Credit according to the FTB website:

Within one week (seven calendar days) after the close of escrow:

• • The seller must complete Part I of Form 3528-A, Application for New Home Credit, certifying that the home has never been occupied, and provide a copy to the buyer or escrow person.
  • The buyer will complete Parts II & III of Form 3528-A.
  • The escrow person on behalf of the seller and buyer will fax the completed Form 3528-A to FTB at 916.845.9754, and provide a copy to the buyer.
• Fax is the only delivery method that will be accepted and considered for credit allocation by FTB, as the date and time stamp on the fax will determine the order in which credits are allocated.
• Fax only one completed application per residence with all qualified buyers listed. Do not include information on nonqualified buyers. An incomplete application may delay or prevent credit allocation.
• Do not fax the application to FTB before escrow closes.
• Do not fax the application to FTB more than once. We will process the applications in the order received as quickly as possible.
• Escrow companies should only send one application per fax transmission.
• The buyer keeps a copy of the completed Form 3528-A for their records.
• The Form 3528-A is now available online as a fillable form. Simply fill in all required information, print the form, and sign. If you fill out the form by hand, please print numbers as clearly and neatly as possible using CAPITAL LETTERS and staying between the lines. The faxes can be very hard to read.

California state government has set aside $100 million to be used in the form of a tax credits for people buying a new home anywhere in California.

Elements Of The California 10,000 New Home Tax Credit

• A home buyer must purchase a new home which has never been occupied. The seller must certify that the home is a new home.
• The California Revenue and Taxation Code Section: 17059.(b)(1) which defines what a qualifying property is for the purposes of the new home tax credit as: “qualified principal residence” means a single-family residence, whether detached or attached, that has never been occupied, that is purchased to be the principal residence of the taxpayer for a minimum of two years and is eligible for the homeowner’s exemption under Section 218.
• The home must be purchased between March 1, 2009 and February 28, 2010.
• Home buyers do not have to be first time home buyers.
• Unlike the federal housing tax credit, the California new home tax credit has no income limitations.
• The amount of the tax credit is 5% of the home’s purchase price up to $10,000 whichever is less. The tax credit will be paid to the home buyer over a three year period in equal parts and the home buyer must request the tax credit each year the are due for the tax credit.
• The home buyer must live in the home for at least 2 years or the tax credit must be repaid.
• The tax credit is available on a first come first served basis with approximately 10000 home buyers being able to qualify for the tax credit. As of May 1, 2009 approximately 4,200 Californians have applied for the new home tax credit.

This 10000 California tax credit is in addition to the 8000 Federal tax credit from the US government. To learn more about the 10000 California tax credit, see the California FTB site.

You can find instructions for how to apply for the $10000 New Home Tax Credit and how to claim the tax credit at the California FTB web site.