The FHA loan program just got yet another injection to help expand the buying opportunities for first time home buyers.
Months ago the US Treasury announced that it would offer an $8,000 tax credit to first time homebuyers (considered those who haven’t owned a home in the past 3 years) who purchase before December 1, 2009. This replaced the prior incentive program which was a $7500 loan which had required repayment.
Now, the Housing & Urban Development department has announced that the FHA program is going to allow the $8,000 tax credit to be used upfront to help pay for closing costs, including an interest rate buy down. Now, first time home buyers need only come up with the 3.5% down payment.
This should help increase the number of active, first time home buyers in the market, helping to lower the amount of excess inventory at the entry level.
As a side note, I hear the Oregon Bond program will be once again have funding available in June. I’ve been told by a loan officer source that now is a good time to put reservations of funds in place, because it will likely become bombarded with applications once they formally announce the availability of funds.
