$8,000 First-Time Buyer Tax Credit Can Be Used As Down Payment
Federal Housing Administration is going to permit its lenders to allow home buyers to use the $8,000 tax credit as a down payment.
Previously, most buyers wouldn’t receive the funds until after they filed their tax return, and that deterred some people from using the credit. The NATIONAL ASSOCIATION OF REALTORS® has been calling for the change.
The goal is to enable FHA consumers to access the home buyer tax credit funds when they close on their home loans so that the cash can be used as a down payment
He says FHA’s approved lenders will be permitted to “monetize” the tax credit through short-term bridge loans. This will allow eligible home buyers to access the funds immediately at the closing table.
Consult with your approved FHA lender for availability.
In late June 09 Mortgagee Letter 9-15 which allowed tax credit loans has been retracted and the letter has been removed from the HUD web-site.