Changes To The First Time Home Buyer Tax Credit

There was a news post put out by HUD (The Dept Of Housing And Urban Development) last week stating that the Federal Housing Administration (FHA) is going to allow first time home buyers to "monetize" the tax credit and use it as a sort of bridge loan to make a down payment on a home.  This would allow the purchaser to use the money up front rather then use it later.  This plan was still in the works and then rumors began that the plan wasn't going to be implemented and that the credit shouldn't be considered debt or a loan but an actual credit.  I have just received word from HUD once again that the plan is still on track and all of the technical details are being worked out.  A press release will be issued shorlty on the NAR website which I will share with all of you once released. 

Under the guidance that's under development, state agencies and other HUD-approved entities would be able to provide short-term bridge loans that households could use to help with their downpayment. The loans would be repaid with the proceeds from the households' federal tax credit.

When the guidance is released, it is expected to cover eligible lenders and set parameters for loan terms and repayment.

I personally applaud any efforts to improve the health of the housing market.  Here in Westchester we are seeing alot of spring activity, bidding wars, and homes are selling!  The spring market is always the best time of year, it's not the spring market that we have seen in past years but still full of optimism