Putting house up for sale before 3 year commitment is finished

[Zach T]

I bought my house when the $8k tax credit came around. My plan is to sell it and buy a double to rent out. I live in PA if that matters. I need to technically live there until October.

Would I be able hire a realtor and have them start showing the house a few months before hand to get the process started ASAP. I would make sure closing is after the 3 year commitment is complete. The goal being to sell the house asap without having to pay back the tax credit.

[James H.]

As long as you don't sell it you can do whatever you want. You can think about and talk about selling it all you want. You can advertise it for sale or promise to give it away as long as you wait until october.

[Rich Weese]

Hi Zack and Brian,

here is one additional item that I learned recently. I have a client that is attempting to buy a new residents to owner occupy. He bought his current residence with the $8000 tax credit. In applying for the new loan on the new residence, he was denied by the mortgage company due to the following.

There have been many people that bought under the $8000 credit that now find themselves under water on the home they live in. What many of them are doing is purchasing a new residence which gives them a better payment situation while they have good credit. They are then walking away from their original residence because it is so far underwater. My prospective client was told he would have to obtain a new appraisal on his current home showing he had 25% equity in the home or he would have to reduce his loan on that home to a 75% LTV.

This occurred in the state of Texas and I don't know if this is the same nationwide, but I would imagine it is. If there are any other mortgage people on BP to either substantiate this is accurate or lead me to a different mortgage broker that has different information, I'd certainly appreciate it. If this is occurring nationwide this will make a difference in what you may do currently and also in the future. Rich

[William D.]

Zach, I am going through the identical situation. Ironically, I also have to wait until October. I reread the credit form a month ago and there is nothing that would prohibit us from marketing the property -- or even enter into a contract. It is the conveyance of title. One thing to be careful of is that you must still reside there.

[Mike Morrison]

I just curious, why would you get an agent involved now if you can't sell until October? I mean as an agent my job is to get the property sold asap. Why would I want to spend MONEY marketing your property now, in February if I can't close the deal for 8, count 'em 8 months? I know that doesn't fit your "plan".

GIVE ME A BREAK. Oh, that's right, agents work for FREE. We never incur marketing expenses, must have slipped your mind!

What you are asking of an agent is like me duct taping you to a chair at dinner. Putting your favorite food in front of you and asking you to wait till I get ready for you to eat...

Save some unsuspecting or rookie agent some grief . FSBO!

[James H.]

Originally posted by Mike Morrison:

I just curious, why would you get an agent involved now if you can't sell until October? I mean as an agent my job is to get the property sold asap. Why would I want to spend MONEY marketing your property now, in February if I can't close the deal for 8, count 'em 8 months? I know that doesn't fit your "plan".

GIVE ME A BREAK. Oh, that's right, agents work for FREE. We never incur marketing expenses, must have slipped your mind!

What you are asking of an agent is like me duct taping you to a chair at dinner. Putting your favorite food in front of you and asking you to wait till I get ready for you to eat...

Save some unsuspecting or rookie agent some grief . FSBO!

I disagree. I had a situation where I wanted to sell my house because I thought I was going to move for work, but it was about 8 moths out (coincidentally). I explained my situation to the agent I was referred to, and he told me that given the market, it would probably take 6 months to move it anyways and this way I could hold it on the market at a higher price and then start dropping it at the time came near. He is one of the most reputable agents in my area and had absolutely no problem with this. I guess it depends on who you agent is...

[Joe Delia]

If he explains the situation to his agent and they accept the listing, then that agent can't really complain. If he/she doesn't want it, don't take the listing. That simple.