$8000 Tax Credit Can Now Be Used as Down Payment Money Upfront

Catawba Springs - A Great First Time Home Buyer Neighborhood in Denver, NC

I wanted to share this valuble piece of info that was freshly released from HUD regarding the $8,000.00 tax credit for first time home buyers!

HUD Secretary Shaun Donovan put to rest today rumors that HUD would renege on its previously announced plan to allow first time-home buyers to apply the current $8,000 tax credit toward the purchase of a new home at settlement. Speaking before a standing-room-only audience at the NAHB’s spring board meeting in Washington, D.C., Donovan announced that, effective immediately, first-time home buyers using FHA-approved lenders would be able to put their tax credit toward closing costs or use it to boost their downpayment to an amount above the FHA-required 3.5%.

Addressing home builders unhappy with the Obama administration and Congress for excluding them from stimulus or recovery programs so far, Donovan sought to assure the audience that HUD would like to “partner with you.” He added that the White House knew that “the U.S. economic downturn began with the downturn in the housing market and recovery has to begin in the housing market, as well.”

A housing recovery, Donovan continued, would generate thousands of jobs in the United States, help advance the administration’s policies on energy efficiency, and would simply be “a smart investment.”

The first step, he said, would be to enhance the usefulness of the $8,000 tax credit by letting buyers access the money immediately rather than having to wait to receive the credit at tax time. This action, Donovan said, “will assist home buyers at closing, but it will particularly benefit home builders across the country.”