I wanted to write a quick blurb about the TCAL program through the Missouri Housing Development Commission. The TCAL program stands for Tax Cash Assistance Loan- think of it as an advance loan on the $8000 tax credit that a first time home buyer is eligible for if closed prior to 12/1/2009.
The loan is similar to the old bond money loan with the exception of instead of a grant there is a second mortgage placed against he property that can be paid back in one lump sum out of the tax credit that a first time home buyer is eligible for. The loan requires a quick online counseling/home buyer education on how the program works and can be found on the MHDC website.
Basically the client is loaned the down payment and closing costs if necessary, they sign a second mortgage and when the tax credit is received that money is then paid back in full, if not it shifts to a true second with a monthly payment.
This is a viable option for customers that are first time home buyers ONLY, that do not have any other means of saving or getting a down payment, I say that because the rate on this program is well above current market rates for an FHA loan, so its very VERY important your client compare the TCAL program with an FHA loan, the current rate on a TCAL loan is 6.31 while FHA rates have ranged from 5 to 5.50 over the last couple of weeks. Remember FHA down payment can be a gift and the minimum down payment is 3.50 percent.
We will always advise the client and give choices and options to the client to best fit their financial needs rather than just push them into a loan program.
If you happen to be in a state outside of Missouri google your states Housing division or Economic arm in your state to see if a similar program is available.
Darren Stewart
OakStar Bank -
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