FHA has announced that it will allow homebuyers to use the 2009 $8,000 First Time Homebuyers Tax Credit when purchasing a home, by allowing lenders to provide a short term bridge loan. The tax credit will not be able to be used for the 3.5% required down payment for FHA loans, but can be used as either an additional down payment, for closing costs, or for discount points to buy down the interest rate.
You can claim the tax credit if you are a first-time homebuyer (meaning you haven’t owned a home in the last 3 years) and you are purchasing your home before December 1, 2009.
You cannot claim the tax credit if any of the following apply:
1. Your modified adjusted gross income is $95,000 or more ($170,000 or more if married filing jointly)
2. You are a non-resident alien
3. You are purchasing your home from a relative
4. You have unsettled IRS obligations
Important points to know about using the tax credit:
1. You may not use it for the 3.5% down payment requirement
2. A copy of your 2008 tax return will be required, along with current pay stubs showing the same income/deductions as 2008
3. The tax credit advance cannot be for more than the anticipated tax credit will be according to IRS Pub 5405 – First Time Homebuyer Worksheet
The next step will be for lenders to determine how and if they are going to provide the short-term bridge loans.
To be continued…..