The Department of Housing and Urban Development (HUD) announced Friday its plan to allow first time home buyers who qualify for the federal income tax credit to get the money advanced to pay closing costs and additional down payment. Buyers must use an FHA approved lender, like Mortgage California, and be able to put down at least 3.5% from their own savings.
Until last Friday, San Mateo home buyers who were eligible for the tax credit would have to wait until they filed their taxes to collect their money. With this new plan, lenders are allowed to buy tax credits from first time home buyers and collect the rebate directly from the IRS. Although first time home buyers must still come up with the entire 3.5% down payment from their own savings in California, they can use the rebate to help pay for closing costs and/or additional down payment money to reduce the loan amount and therefore reduce their monthly payments.
To discuss how you can finance your first home with little money down, please give me a call at (650) 520-0915 or send me an email at [email protected].