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Confusion over First Time Homebuyer Tax Credit Potential Program
According to the latest announcements HUD is working on allowing home buyers to use the First Time Home buyer Tax Credit of up to $8000 as a soft second mortgage/down payment; although the exact details of the plan are still being refined, this is yet another positive step for first time home buyers.
Shaun Donovan, secretary of the U.S. Department of Housing and Urban Development stated that the Federal Housing Administration (FHA) is working on details outlining how they are going to permit it's lenders to allow home buyers to use the $8000 tax credit as a down payment. Previously, buyers had to wait to file their taxes to take advantage of the tax credit, which hindered some home buyers from buying.
Hopefully the full details of the program will be available shortly. Making changes to policy takes time but they have been working diligently on the program.
NC Finance Agency's Mortgage Credit Certificate Program
Home buyers who meet the North Carolina Finance Agency's qualifying income requirements, sales price, and first-time home buyer guidelines may be eligible for a Mortgage Credit Certificate (MCC); this federal tax credit was authorized by Congress to assist home buyers with moderate and low incomes. Each lender sets the terms of the mortgage, and includes the interest rate, down payment, underwriting criteria, discount points, and closing costs.
While all homeowners can claim an itemized tax deduction for mortgage interest, an MCC takes it a step further; it reduces your tax liability, dollar-for-dollar, by a percentage of the mortgage interest paid.
If a home buyer qualifies, 20% of the interest paid on the mortgage as a credit on your federal income taxes can be claimed, which will save up to $2,000 per year on federal taxes, and is money that can be put toward the mortgage payment.
The MCC can be combined with the new $8,000 federal tax credit, if eligible, until that credit expires in December 2009. Also, the Mortgage Credit Certificate can be used with almost any type of mortgage, including adjustable rate mortgages. However, it cannot be used with the Agency's FirstHome Mortgage.
Now is a great time to buy. Contact Real Living Realty Experts for more information at 919-387-4100
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