Looking to buy your first home but don’t have the essential funds needed for the downpayment? Well I have some great news for you!

The government recently added the single best home buying incentive to first time home buyers in the history of the country. The newly added $8000 tax credit is a very significant amount of money that you can officially use the tax credit now, get the money in the form of a refund on your 2008 taxes and then apply the money to your downpayment on your first new home. So anyone that has a good job history, credit worthy of purchasing a home, looking to stay at the new home for at least 3 years should give serious consideration to moving forward with a purchase.

Now as great of an idea as this is, it will still have a few speed bumps along the way. The $8000 tax credit is enough money to cover the mandatory 3.5% down payment needed to qualify for a home purchase price of $225,000. However that still leaves the issue of the closing costs needed to actually close the loan. FHA does allow a seller contribution of up to 6% to help go towards the buyers closing costs in some situations, so you will have to figure on writing in the seller concession into the contract to buy your new home.

Now, using this method to get your down payment is a phenominal idea but you also have to responsible. You must make your purchase of the new home quickly after receiving the refund. If for some reason you can not complete the purchase you must be prepared to give back every penny of the $8000 credit to the government. So please keep this in mind.

I would highly recomend that you speak with your accountant or tax professional to best figure out the correct way to make this happen.

If you know anyone who could benefit from this new government incentive, please spread the word to them. As always I am here to help and can answer any questions anyone may have.