There's been a lot of buzz in the real estate and mortgage industries about FHA allowing home buyers to use the $8000 tax credit as a down-payment.  However, in this case the government giveth and the government taketh away!

Tuesday May 12, 2009, in an address to several thousand REALTORS® gathered at "The Real Estate Summit: Advancing the U.S. Economy," at the 2009 REALTORS® Midyear Legislative Meetings & Trade Expo in Washington, DC, HUD Secretary Shaun Donovan said that FHA was going to enable home buyers to access the $8,000 tax credit at closing, so the funds can be used as a down payment.  This was to be accomplished by allowing FHA's approved lenders to "monetize" the tax credit through short-term bridge loans, which would have allowed eligible home buyers to access the funds immediately at the closing table.  FHA/HUD had also posted mortgagee letter 2009-15 (ML 09-15) on their website, which explained the program.  CLICK HERE to read NAR's article about the announcement

However, according to several lender sources and information found on-line, later the same day Secretary Donovan's remarks were retracted and FHA/HUD removed the ML 09-15 from their website. 

HUD doesn't mention the embarrassing misinformation anywhere on their website, so at least for now it seems that the reason for the program being withdrawn (or at least delayed) will remain unclear!

Here are some links to on-line articles that I found regarding HUD's change of heart...

www.thetruthaboutmortgage.com/fha-may-scrap-homebuyer-tax-credit-for-down-payment/

www.mortgagenewsdaily.com/05182009_first_time_buyer_tax_credit.asp

www.azcentral.com/arizonarepublic/business/articles/2009/05/18/20090518biz-downpayment0519.html