Interest rates are great, real estate is selling at a discount …. which all adds up to a great time to buy a home!! And for first time homebuyers; the news just keeps getting better and better thanks to MHDC.
The Missouri Housing Development Commission (MHDC) releases money to first time homebuyers throughout the year and in the past this money has been non-taxable. But,in their most recent bond-issue, the monies they provide to first time homebuyers are taxable!
At first thought, most people would think this is a bad thing; as the borrower has to pay taxes on the 3% down payment money they receive, but until July 1, 2009 this is actually a great thing.
Because this down payment money is considered taxable; the borrower will now also qualify for the $7,500 Housing Tax Credit provided by the Federal Government.
So for example; let’s assume we have a first time homebuyer who qualifies for the MHDC down payment assistance program and they purchase a $150,000 house prior to July 1, 2009.
MHDC would provide them with 3% or $4,500 towards their down payment, which until the end of this year is all you need for a down payment on an FHA loan. Then when our borrower does their taxes; they will receive an additional $7,500 from the federal government.
There are many rules associated with MHDC and the Housing Tax Credit and in addition it is not free money, but it is a great opportunity for those first time homebuyers.
Please contact me for more information on these wonderful opportunities!!
30 Year Fixed 5.75% with 0 points
MHDC (CAL) FHA 30 Year Fixed 7.15 with 0 points
FHA 30 Year Fixed 5.5% with 0 points