I was just waiting for a couple of days to make sure that this announcement wouldn't be changed - as it was the last time.
FHA approved lenders are allowed now to issue so called 'bridge loans' that will allow the first time home buyers to use the funds to:
- cover their closing costs
- buy down their interest rate
- or put down more than the minimum 3.5 percent (the funds cannot be used to cover the minimum 3.5 percent). In short what it means is that the 8K cannot be used toward the downpayment of 3.5 percent.
Due Diligence
FHA expects that entities purchasing tax credit assets will employ appropriate due diligence
measures including, but not limited to:
• Require the homebuyer to draft and provide the IRS form 5405 “First-Time Homebuyer Credit.”
• Contact the borrower’s employer and review pay stubs to confirm there are no outstanding garnishments.
• Review the homebuyer’s credit report to ensure there are no unpaid student loans, or other obligations that could be offset against the credit.
• Validate that all of the eligibility requirements for the tax credit are fulfilled
• Review previous tax returns and IRS tax assessment letters, if any, to determine that the borrower does not have unsettled obligations to the IRS
If you need more information or if you want to receive the IRS form:
call me at 405.812.1572 or email me: Bo@Okla-OK.com
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With smiles,
Bo in Yukon
Search Homes in Yukon, Mustang and Greater OKC Metro
Bo Kociuba, Realtor®
Serving Oklahoma City Metro - Yukon, Mustang, Tuttle, Piedmont, Newcastle, Bethany, Oklahoma City and Edmond
Let's get connected:
Bo,
Thanks for the well written post on this, there seems to be a lot of confusion about the down-payment part - but you hit the nail on the head. :)
Mark - you are right about confusion...hope this post will clear some of it...best to you...
with smiles,
Bo in Yukon
Thanks Bo for clearing some of this mess up, I keep hearing different things just about every day..Hopefully someone from NAR will clear all this up
Brian - this is a 'final version' ... HUD's MORTGAGEE LETTER was released on May 29th ...
With smiles,
Bo in Yukon
Bo, to check all the HUD letters you can go to www.hud.gov/offices/amd/hudclips/letters/mortgagee. I think there is a conference call you can sit in on today at 3:00 pm ET. Let me see if I can get the correct log in for you.
Joe - thanks for the link...I read this letter and put it in file ( just in case)...How are you?
With smiles,
Bo in Yukon
Bo -
Great post and very informative. You're right on the money on the down payment question, much to the chagrin of many who would have liked to use it that way.
Dan
Dan - Thanks. there is so much info available on the Internet...and because of that there is a need to make it a little more concise...
With smiles,
Bo in Yukon
I have contacted several large lenders in New York to find out if they have instituted the 'bridge loan' for closing costs. So far I have not been able to find anyone. Has anyone actually found a lender who will do a 'bridge loan'?
Vickie, from what I know only few are offering this option....not all of the FHA approved lenders have to ...
sorry for the late reply, just came back from vacation...
with smiles,
Bo in Yukon