As of today, you can NOT use the tax credit for a down payment!
Yes there has been a lot of discussion about this topic but it is NOT an option currently. Those statements were made by the Secretary of HUD on May 12, 2009 at The Real Estate Summit during the Realtors Midyear Legislative Meetings and Trade Expo. In fact, a HUD/FHA letter was published on the website Monday night.
~ BUT ~
The new Director of HUD pulled the Mortgagee letter from the site and it is no longer available.
The theoretical program is now off the table and should not be used until there is a real concept of where the money to fund it will come from.
Before this happens there would need to be:
- State agencies approved with money for the down payment.
- A change to the HUD guidelines on the timeframe that is allowable for a loan. (Currently must be amortized over 10 years with no balloon)
- A change to the IRS guidelines allowing your refund to be assigned to a state or participating non-profit entity.
Filed under: Mortgage Information
