As we reported a few weeks ago, FHA was working out the details of a plan that would allow first time home buyers to use their federal income tax credit at closing. On Friday, HUD announced the details.
San Mateo County first time home buyers who qualify for the $8,000 federal income tax credit and who use an FHA approved lender (like me!) can now get an advance on the income tax credit to use for closing costs and additional down payment.
This Plan Fixes Key Problem Under Old Plan
Until last Friday, San Mateo home buyers who were eligible for the $8,000 federal income tax credit would have to wait until tax time to collect their money. The best first time home buyers could do was to adjust their withholdings with their employer. No plan was in place to get San Mateo home buyers the money they needed when it counted – at closing.
How Can I Use the $8,000 Tax Credit at Closing?
With this new plan, lenders are allowed to buy tax credits from first time home buyers and collect the rebate directly from the IRS. San Mateo home buyers must still come up with the entire 3.5% down payment from their savings but can use the federal tax credit for closing costs. Any remaining money can be used to pay down the loan amount and therefore reduce their monthly mortgage payments. As closing costs can be upwards of a few thousand dollars, this $8,000 can mean a significant reduction in the amount of money you need to purchase your first San Mateo home.
Are You a First Time Home Buyer? Attend Saturday’s First Time Home Buyer Class
First time home buyers, join us this Saturday June 6th at 10am in San Mateo for our first time home buyer class entitled How to Buy Foreclosures and Short Sales to learn the differences between foreclosures, REOs and short sales, how you finance a property in foreclosure, the risks associated with buying a distressed property and how you can get $35,000 (in addition to the tax credit money) upfront to fix any cosmetic repairs, and much more!
Who Should Attend?
First time home buyers or home buyers who have only owned homes out of the San Mateo County area. The program will go over the risks and rewards of buying foreclosures and short sales and how you can position yourself to get the best deal possible.
Where Can I Get More Info About the First Time Home Buyer Class?
Visit our previous post, First Time Home Buyer Class – How to Buy Foreclosures, for more information.
How Can I Register?
Registration is free, but space is limited. Please register by filling out the form below, or by calling (650) 520-0915.
cforms contact form by delicious:days
Other Posts You May Enjoy
- First Time Home Buyer Class – How to Buy Foreclosures
- What Is and What Is NOT A Pre-Approval?
- Can I Use My Tax Credit Money for a Down Payment?
- What Should I Bring to My First Appointment with My Mortgage Advisor?
- How Do Mortgage Interest Rates Affect My Monthly Payment?
Enjoyed this Post? Why Not Subscribe?
If you have enjoyed San Mateo Mortgage Blog, please subscribe to our RSS feed.
Chris Williamson is a Mortgage Advisor with Mortgage California specializing in San Mateo Mortgage.
Related posts:
- More Tax Incentives for San Mateo First Time Buyers
- Federal Home Buyer Tax Credit Not Just for San Mateo First Time Home Buyers Anymore
- Webinar: Guide to the Home Buyer Tax Credit – Not Just for First Time Home Buyers Anymore
- CalHFA Cal30 Low Interest Fixed Rate Loan for First Time Buyers
- Two Down Payment Assistance Loan Programs for Home Buyers
