I have observed and answered a few questions you have posted here on Trulia. I think your best course of action is to hire a Buyer's agent who will represent your interests. You have alot of legitimate questions and concerns. You should have a professional guide you thru your buying transaction. This should not be left to chance. Neither should you rely on advice from an online community of realtors who in the long run does not have a fiduciary duty to you.
You need to fully understand the tax credit. It is like an interest-free loan for 15 years. The payout begins 2 years after you move in, and then you will send the government about $500 per year until the loan is paid off. If you move before that time, you must give back what is unpaid.
If you don't need this, don't use it. If you would like to have the use of the government's money with no interest, then it is a great deal. If your income is over $75,000 per year then you will be getting less - it is pro-rated at that point.
I have a great brochure which our company put together on this issue. If you would like a copy, please email me at firstname.lastname@example.org and I will send it to you.
You have received some good answers. The big picture is that is you have the assets, you do not need the assistance ! I can understand why you dont want to inflate the sales price for the assist, so just let it go. You will owe less on the property. Also keep in mind you may be able to get some assistance or financial consideration after your home inspection - hopefully you already have a good buyers agent for that step : )
The $7,500 tax credit is a great stimulus for first time buyers but you will not get that until you do your taxes next year. Further, you will end up paying that back over the next 15 years at $500.00 a year so it turns out to be an interest free loan. Thanks Uncle Sam ! Still, nothing wrong a a 15 year interest free loan either !
Good luck - if you need more help, check out our site below and email us from there.
The way it has been explained to me is that when you file your '08 taxes, if you owed $5,000 in taxes for the year you would subtract $7500 from that, and the balance $2500 you would recieve in a check from the IRS. That $7500 has to then be paid back over subsequent years.
If you have more mortgage related questions please contact me, you can find my info on my website
Also, as long as you qualify for the credit, you can receive the credit no matter what other financial program you use.
This credit is not related to the federal tax credit of $7500! So, you may be good!
Also, check around for rates with other lenders. We all have no-cost loans. They are just at higher rates!