Friday the St. Petersburg Times stated that Governor Christ signed a bill to allow for the First Time Homebuyer Credit to be used as down payment and I am getting numerous emails regarding the details so I wanted to take a moment and update everyone.
FHA announced today that it will allow the First Time Homebuyer Tax Credit of 8,000 to be used for down payment ONLY ABOVE the FHA required down payment of 3.5% of sales price or the credit can be used towards closing costs. This means that the Buyer would still need a 3.5% down payment from their own funds or from a gift. Today’s announcement does NOT allow the Buyer to use the First Time Homebuyer Tax Credit as the 3.5%. This credit will assist our Buyers with payment for closing costs or the additional deposit which could help the Buyer to qualify for a lower loan amount. There are still details to work out in the mortgage industry before any lender can underwrite and close on this type of transaction.
At this time there is NO program that would allow for the First Time Homebuyer Tax Credit to be used for down payment on a conventional loan. We will keep you updated. Although the Governor signed a bill we do not have any specifics nor information on what State program will be used to work with the tax credit as down payment.
For most of our market area the maximum FHA loan amount is $292,500. If you want to take advantage of this option and have 3.5% saved or can get a gift from an approved source and want to write a contract, at this time my suggestion would be to write the contract for a closing of 90 days. We do not have all the procedures finalized by FHA inorder to close the loan.
Remember, a first time home buyer is someone who has not owned a home in 3 years, not just a first timer!
Call us for more information: 813 784 7744 or email: [email protected]