8K Tax Credit Towards Down/Closing?

[Anonymous]

I notice on the tax credit website that there is a way to use the 8K credit towards a down payment and closing costs.  First time I've heard that.  I haven't come across any lenders that mention this.  

Does anyone know anything about it?

Thanks!

[Anonymous]

I believe, in every instance, you must first meet the lending requirements without the credit assistance. For example, FHA requires a 3.5% down payment. You must provide that. Then, if you work a loan-against-tax-credit deal with a lender, you can add the amount of the credit to your down payment, or use it for other costs. In short, under no circumstance can you qualify for a mortgage using ONLY the credit as your money base.

[Anonymous]

ya its only available in some states. Its a bridge loan. what state are you in ?

[angie204]

I talked to my LO about this.

She said that only certain lenders are authorized to do them.  Some states are participating, at their own choice, through certain homeowner's assistance programs.  However, my state is not.  Also, my LO said that none of her lenders do the program either. 

The previous poster is correct, you have to meet the minimum down payment for FHA (3.5%) out of your own funds, but you can use the bridge loan to pay certain closing costs and prepaids.  So it could be useful for those costs, and to boost your down payment.

Call a local LO, they should be knowledgable about what is available in your state! :-)