The topic: using the $8,000 tax credit up-front to help first time buyers purchase a home.
The problem: how do you give somone cash from a tax refund before the actually close on the home? This is referred to as credit-monetization
The proposed answer: by lending it to them up front with a bridge loan IF AND ONLY IF they use FHA financing for the purchase. Who will lend the money? Supposedly large banks or bank affiliated mortgage lenders. In reality it will take a bit to see who steps up and puts the program in place but time is running out because the tax credit is only good for purchases closed by November 30, 2009.
Some of the other items that need to be addressed, in addition to the money should include:
- Proof that a buyer does not have judgments, tax liens, back child support or wage garnishments that could bite into the tax credit
- Federal oversite to make sure there is no abuse of this potential program including mandatory caps on fees.
There has clearly been no better time to be a first time home buyer!
Call Todd Abelson & Tyler Ford for all your mortgage related needs at Sunstreet Mortgage, Tucson Arizona.
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