Can the $8,000 Tax Credit Be Used as a Down Payment?
Many first-time home buyers are asking whether or not the $8,000 tax credit can be used as a down payment. The short answer is “no”.
Apparently someone from US Department of Housing and Urban Development made a big announcement at a recent meeting for the National Association of Realtors in May 2009. They were a little early and didn’t do enough research. The media did pick up on this and it was misrepresented by the media.
It turns out the money would have to be a loan. Lenders were not able or willing to do this so it was turned to non profits who were not willing either.
Part of the challenge with this is that it would be considered a loan and non profits don’t have the funding nor the manpower to analyze every first-time home buyers’ financials to estimate how much if any of the $8,000 they are eligible for.
So unfortunately, it probably won’t be available for first-time buyers to take advantage of. Of course, we will let you know if that changes.
