1st Time Buyers in Mass May Use $8,000 Credit as Down Payment!

This just from the Governor’s office! As part of the Massachusetts Recovery Plan, Governor Deval Patrick yesterday announced a First-Time Homebuyer Tax Credit Loan Program through MassHousing that will allow first-time homebuyers to borrow up to $8,000 in advance of their federal tax credit for homes purchased with a MassHousing loan before December 1, 2009.

The First-Time Homebuyer Tax Credit Loan will allow Massachusetts homebuyers to use the $8,000 tax credit from the federal Housing and Economic Recovery Act (HERA) of 2008 as a funding source at the time of closing to help purchase the home. Under HERA, the maximum available credit is $8,000 and is claimed when homebuyers file their 2009 federal tax return.

This Tax Credit Loan will be a great benefit for homebuyers because it will give them more money up front when they purchase their home and this will hopefully encourage more people to buy a home.

Homebuyers who take advantage of the program will have the principal and interest payments on the tax credit loan deferred from the time of closing until the loan due date of June 1, 2010. If the loan is not repaid in full by June 1, 2010, the loan will be amortized for 10 years at the same interest rate as their first mortgage loan.

Qualifications for the First-Time Homebuyer Tax Credit Loan include:

• Applicants must be first-time homebuyers using a MassHousing mortgage through a MassHousing-approved lender.
• Homebuyers must use the home as a principal residence for a minimum of three years (the Tax Credit Loan cannot be used for investor properties).
• Homebuyers must purchase a one, two, three or four-family home from a seller unrelated to the buyer by November 30, 2009.

For more information, please visit:  www.mass.gov/dhcd/1sttimebuyer or www.masshousing.com.

Be sure to call the next time I can help you, a friend or a co-worker buy or sell a home in the greater Boston area. I promise to take excellent care of them!