$8,000 for 1st Time Homebuyers

[Lorine R. Williams]

Exciting New Program to increase home sales & stabilize the real estate market

U.S. Housing & Urban Development (HUD) Secretary Shaun Donovan announced on May 29th an exciting new program to stimulate home sales as part of the Obama administration’s American Recovery Act of 2009. Homebuyers are now offered a tax credit of up to $8,000 for the purchase of their first home. “Families now will be able to apply the anticipated tax credit towards their home purchase right away” announced Secretary Donovan.
How it works:

• First time home buyers can now apply the new $8,000 tax credit towards the purchase costs of a FHA-insured home.

• This $8,000 tax credit can immediately apply the funds towards either their down payment or closing costs.

• Buyers using FHA approved lenders can apply the tax credit to their down payment in excess of 3.5% of the home’s appraised value.

• Borrowers may be able to secure a reduced interest rate under the plan.

• The tax credit can be accessed after tax returns are filed with the IRS.

According to the National Association of Homebuilders, the tax credit will encourage approximately 160,000 home sales - 101,000 of which will be new homebuyers who directly receive the credit and another 59,000 secondarily affected as current homeowners who are able to buy another home because a first time buyer purchased their home. Unfortunately, these credits do not apply to purchases made in the U.S.V.I.

First Time Homebuyers


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