Home Buying in Burbank>Question Details

Shapur, Home Buyer in Burbank, CA

Is it true that on FHA Loans you can use the 8000 credit as your Down Payment for first time Home Buyers.?

Asked by Shapur, Burbank, CA Sun Jul 19, 2009

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Hi Shapur,
In order to take advantage of the $8,000 tax credit you will have to settle on a home no later than Dec.1st this year.The way I understand it you will not have this money at the settlement table.This means that you will have to have a downpayment at settlement (without the stimulus money)however with FHA you can have a gift from a relative for the downpayment and the seller can pay the closing costs up to 6% however you cannot get money back from the seller from any leftover closing help (one of the bank's guidelines)The money from this stimulus bill will come back to you once you file either an amended tax return for this last year or next years tax time but that is after settlement.Then you can do what you want with the stimulus money. You do have to meet the guidelines with income in order to qualify and you cannot have owned a home in the last 3 years.If you owe money for taxes than that will be deducted from the $8,000.I would suggest you talk to a lender because there might be another type program (community grant program such as CDA )where you might not need a downpayment however with all the changes that have happened in the banking industry it is very difficult to find a no money down loan. VA would be one of the financing avenues if you have military benefits since you do not a downpayment. Good Luck!Donna
Web Reference: http://www.john-donna.com
0 votes Thank Flag Link Sun Jul 19, 2009
You Can not use it towards your 3.5% down payment.
There is talk of using the $8,000 as additional down payment over and above the 3.5% required by FHA.
However, I have been discussing this with lenders in my area in great length....
There are ramifications in doing so. There are issues with debt to income ratios and loan to value issues because the $8,000 is utilizied via bridge loans.

It is extremely difficult to find lenders who will do this type of loan
0 votes Thank Flag Link Sun Jul 19, 2009
Shapur
Have you talked with a lender?
Artin Babayan, the OCD Group 1-800-963-4623

The $8000 phases out with income, so in order to qualify you probably will not see much of the credit.
0 votes Thank Flag Link Sun Jul 19, 2009
Keith Sorem, Real Estate Pro in Glendale, CA
MVP'08
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