First-Time Home Owner - Tax Credit

Key factors:

• Timeframe: Must purchase a home (close and receive title) on or after January 1, 2009 and before December 1, 2009.
• Down payment or closing costs -- Qualifying buyers can use these funds upfront as a down payment or for closing costs.
• FHA-approved lenders, only-- At this time, only FHA-approved loans are required if tax credit is used as a down payment.
• Need 3.5% upfront  -- While the $8,000 tax credit can be used for the down payment or closing costs, home buyers must still come up with FHA's required 3.5% down payment on their own.

Information on the $8,000 tax credit:

• Use as downpayment or closing costs -- Initially, the tax credit was designed as a refundable credit on buyers' tax return next year -- either up to $8,000 or 10% -- whichever came first. Now, a new HUD initiative allows qualifying first-time home buyers to receive these funds upfront to be used as a down payment or money towards closing, as announced by U.S. Housing and Urban Development.

• FHA Lenders, only -- At this time, only the Federal Housing Administration (FHA) has issued guidance regarding the monetization of the first-time home buyer tax credit. Home buyers using FHA-approved lenders can apply the tax credit to their down payment.
• Home buyers must pay the 3.5 percent -- While the $8,000 tax credit can be used for the down payment or closing costs, home buyers must still come up with FHA's required 3.5% down payment on their own.

If you need 100% financing you could qualify for a

Usda Rural Development Loan

Louisiana Mortgage Lenders