Using the $8000 for money down, closing costs on FHA loans
Wednesday, June 10, 2009 | 1 comment
For weeks, the subject of HUD allowing buyers to use the $8000 Federal tax credit for FHA money down and closing costs, was bandied about, with no real expectation it would actually become a reality.
On Friday, May 29, 2008 HUD announced they would indeed allow the use of this tax credit for money down and closing costs. The details are in the HUD release – MORTGAGEE LETTER 2009-15: http://www.hud.gov/offices/adm/hudclips/letters/mortgagee/files/09-15ml.doc
The question borrows keep asking is: Is it true that I can now use the (up to) $8000 tax credit for the purchase money down and closing costs?
The answer is, yes and no.
- Yes, HUD did agree to the concept and spelled out how it should work.
- NO, it is not currently available at this time with either direct lenders or mortgage brokers.
Why? Because many practical issues need to be worked out such as:
- How can the money borrowed against the tax credit be guaranteed of repayment?
- What entity administers the paperwork?
- How will this be structured, a temporary 2nd lein?
Many structural and practical issues need to be resolved before this program will actually become available to the homebuyer.
How long will it take? My guess is a few more weeks, perhaps more than a month. It better happen fast, the tax credit ends for first time homebuyers who purchased no later than November 30, 2009.
most people need the tax credit for the 3.5 percent down the feds should bring back the
neamiahprogram or the american dream down payment assistance program it does work
and helps americans where they really need it to realize there dreams