Tax Credit Fha Down Payment
January 9th, 2009
Question: Can the $8,000.00 tax-credit be used for a down payment on a FHA morgage loan?
Answer: HUD just came out with a new FHA mortgagee letter (2009-15) which gives lenders the opportunity to start developing “bridge loans” to get you the money prior to closing, then you pay it back.
There are still some problems with it though:
– it cannot be used for “down payment” only for closing expenses and pre-paids. That means you still need to get your own 3.5% down payment.
– The lender cannot balloon the note (get it all paid off at once) any sooner than TEN YEARS! This should have been structured as a 90 day bridge at most.
– If the lender wants to collect payments on it from the first month, the payments must be included in the debt-to-income calculations. This will kill alot of deals.
– To avoid the DTI calculation inclusion, no payments can be required for 36 months – the $8k will be long gone by then!
– Lenders cannot charge more than a 2.5% fee for the loan, so on $8,000 that’s about a profit of two-hundred-dollars.
– It will be ALOT of paperwork to do this extra loan – and some people will end up not paying it back.Bottom line: Obama’s team will get much good publicity for “giving the green light” for it to happen. Even though it won’t happen. At least not yet.
In the end, it shouldn’t happen – it will increase our downward spiral of foreclosures. The government should not be adding to the lists of people who “own” houses with nothing invested in them, and with zero track record of being able to live within their means. It will “boost” the economy for a small while, but will ultimately add to the economic problems.
District receives $1.3 million from state
The Metcalfe County Board of Education recently accepted an offer from the Kentucky School Facilities Construction Commission.
$8000 Tax Credit to be used as downpayment
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Tags: 8000, 8000 tax credit fha down payment, credit, down, fha, hud