Shaun Donovan, secretary of the U.S. Department of Housing and Urban Development(HUD) has announced that the Federal Housing Administration is going to permit its lenders to allow homeowners to use the $8,000 tax credit as a down payment.
Donovan’s remarks came in an address to several thousand Realtors® at The Real Estate Summit: Advancing the U.S. Economy, a special daylong session at the Realtors® Midyear Legislative Meetings & Trade Expo in Washington DC.
Secretary Donovan said that important changes, which the National Association of Realtors® has been calling for, will help consumers purchase a home. “We all want 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 downpayment,” Donovan said. According to Donovan, the 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.
Donovan said the Obama administration plans to further stabilize the housing market. “I do think we have some early signs hat the market overall is stabilizing,” said Donovan. “Since January we’ve seen both home sales moving up and down around a relatively stable number and we are seeing the first signs that the rapid decline in home prices is starting to abate.”
Great info on the tax credit. I'm glad the IRS / federal government finally removed the repayment requirement. Now if we can get them to extend the credit beyond the November 2009 cutoff, we'd be even better positioned for a housing upswing.
ReplyDeleteGreat news. Now if the seller is not willing on paying closing costs I can pay them myself
ReplyDeleteThat's great news but who do we go to for the 8k down payment. Where do we fill out this info?
ReplyDeleteRight now, the easiest way is to finance your mortgage through the FHA. They'll probably let you apply the 8K to your closing costs. Contact me for more details.
ReplyDeleteHow do you access the $8k to be used towards the purchase. My lender has said he doesn't know where the funds would come from
ReplyDeleteHere's some updated info on how it can be done:
ReplyDeletehttp://www.lendingclarity.com/2009/06/03/hud-says-yes-to-using-8k-tax-credit-for-closing-costs/
Do you have a link for how it can be applied to the downpayment?
ReplyDeleteRight now, the downpayment assistance should work for an FHA approved lender: http://money.cnn.com/2009/05/29/real_estate/tax_credit_as_downpayment/index.htm?postversion=2009060109
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