first-time homebuyers
New details released about the FHA $8,000 downpayment advance
May 30, 2009 by nathancross · 2 Comments
New details have been announced that affect how the $8,000 first-time homebuyer tax credit can be used.
There has been a lot of miss information floating around about the $8,000 tax credit. FHA loans require that a 3.5% downpayment be made by the borrower. Speculation by many in the industry suggested that eligible first-time homebuyers would be able to use the $8,000 tax credit towards their downpayment. Unfortunately that is not true. First-time homebuyers will have to come up with the 3.5% downpayment on their own, then the tax credit can be applied to additional costs, including a higher downpayment, paying points to lower the mortgage rate, and paying closing costs. Lenders will treat the tax credit money as a second lien on the home until it’s paid back. This type of financial product may not be immediately available to buyers since lenders will need to create the internal programs to handle the process.
Nathan Cross, Realtor
The Naumann Group Real Estate, Inc
850.443.2125
