Florida Real Estate Community Tries To Make $8,000 Tax Credit Part of Down Payment
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While this is an interesting idea, it is also one that is full of landmines.
A group of Florida real estate and lending professionals are trying to make the $8,000 tax credit from the Federal Government and turn it into part of the down payment for first time home buyers.
Here is my question, what if the person does not have enough taxable income to qualify for the credit? And also, are we not stepping into the problem that caused all of this where the borrower has not saved their own money for the home? Suffering a little to get into a home makes one appreciate it even more so.
The alliance, led by the Consumer Federation of the Southeast, believes that finding a way to get homeowners the cash upfront, rather than when they file their tax returns, could help spur sales and mend the troubled housing market.
Florida Home Builders Association, Florida Bankers Association, the Florida Association of Realtors and the Florida Credit Union League are members of the group.
The coalition said in a news release Friday it had not yet devised exactly how the credit would be advanced, but would be meeting with lawmakers soon to discuss details. MiamiHerald.com.
It certainly does not bode well for a fast recovery in the economic climate. This will affect all real estate ...
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Comment by Ivan Crago Missoula Realtor on 30 March 2009:
We have the same thing happening in Montana with a few of the low income housing assistance programs trying to figure out how to do a short term loan for the $8,000 that would get recorded as a lein and then paid back with the tax return. It may stimulate some buying but I wonder if we won’t have a similar issue with some of those people in the next year with foreclosures.
Comment by Vicki Lloyd on 1 April 2009:
You said:
“Here is my question, what if the person does not have enough taxable income to qualify for the credit?”
From everything that I have read, you don’t need any tax liability to qualify. Even if you have $0 tax liability, you will get $8,000 back if you are a first time buyer and buy this year.
I agree that people with absolutely no savings at all should probably not buy a house, unless all their excess income has been going to reduce debt, and now they will have that excess to put in to a house.
For a first time buyer with a little bit of savings, and responsible spending habits, this $8,000 could really help them get going while prices and rates are low.
Comment by Dan on 15 April 2009:
Most of these people are already paying higher rent payments than what they can qualify for in a mortgage and they will be buying while the prices are down and the interest rates are down. Soooo this will be the best time for them to be able to lock in a payment that they will be able to keep paying. If they have to wait until they save enough for a down payment the rates will be back up and so will the prices and as they get pay increases it will probably go to rent increases. Bottom line is this is a very good idea! They do still have to qualify for the loan so they will only be buying something they can afford.
Comment by Gretchen on 2 July 2009:
I am a person that has been qualified for a loan and really would love to see this enacted. This is exactly why I am hesitating on signing through on the loan, as we are still nervous about the economy and do not want to take out from our savings. I would say that for me, if this was done and soon…another new home buyer would jump!