More Good News for First Time Homebuyers!

IMPORTANT UPDATE! Unfortunately, HUD has retracted this mortgagee letter. For the moment, the $8,000 Federal tax credit for use as a down payment via a bridge loan/cash advance is not available. Talk is that they are working on a 100% loan with a minum credit score of at least 620. Be on the look out for HUD to come out with something early next year!

Earlier this year we received a gift from the United States Government through the American Recovery and Reinvestment Act of 2009 - an $8,000 Federal Tax Credit to First Time Homebuyers who closed on a home this year! Details of the Tax Credit can be found in the IRS website: http://www.irs.gov/newsroom/article/0,,id=204671,00.html?

But First Time Homebuyers still needed to have the necessary down payment in order to close on the home in order to apply for the tax credit after closing. Problem: Tax Credit was great, but didn't help if you didn't have a down payment. On May 11, 2009, HUD issued MORTGAGEE LETTER 2009-15 and the game has changed!

Buyer's can now use their $8,000 tax credit for the minimum 3.5% down payment on an FHA loan for their new home. IT's a CASH ADVANCE for your down payment! First time homebuyers (or Homebuyers who have not owned a home in the last three years) can amend or file their 2008 tax return to get the $8,000 UPFRONT for closing. If the sales price is $228,000 or less and the seller is paying closing costs and pre-paid expenses, the buyer can buy a home with essentially no money out of pocket at closing. A Sales price above $228,000 will still require the First time homebuyer to come up with some down payment.

Something else I noticed on this on this Mortgagee Letter: Owner-occupants MUST purchase a principal residence and CLOSE on the mortgage before December 1, 2009.

We lost one month of time to close on the home (use to be December 31, 2009).

If you want a copy of this Mortgagee Letter sent out by the HUD (Housing and Urban Development), then email me at JohnM@AmerivestRealty.com and I will send you a PDF of it.

If you are a first time homebuyer looking for a home Atlanta, GA, then you can search here for your new dream home: http://www.amerivestrealtyofatlanta.com/