Vero Coastal Homes 
       Exclusively Representing Home Buyers

FHA Plan Allows Vero Beach Home Buyers To Use $8,000 Tax Credit Upfront

Homebuyers across Florida can take advantage of a Federal Housing Administration program that allows qualified first-time homebuyers to use the $8,000 tax credit upfront to help with the purchase costs of a FHA insured home.

• FHA now permits its lenders to provide a short-term bridge loan to qualified homebuyers for the purpose of accessing the federal $8,000 tax credit at the closing table. While the loan cannot be used to cover the minimum, FHA-required downpayment of 3.5 percent, it will allow homebuyers to use the federal tax credit in one of three ways:

• Homebuyers can use the $8,000 tax credit to make a larger downpayment above the FHA-required 3.5 percent; they can use the tax credit to cover closing costs; or homebuyers can use the $8,000 tax credit to buy down their interest rate.

• Therefore, qualified homebuyers applying for FHAbacked financing with an FHA-approved lender that offers a bridge-loan program can use that loan to bring down the immediate costs of buying a home significantly; however, they would still have to come up with the minimum 3.5 percent downpayment – which is the buyer’s personal stake in their Florida dream home.

• Other resources are available for buyers who need help with the 3.5 percent downpayment, including the Florida Housing Finance Corporation, many local government agencies and nonprofit lenders.

• In addition, Florida has approved $30.1 million for its new Florida Homebuyer Opportunity Program, which will help first-time homebuyers with downpayment assistance through its own tax credit bridge loan program, once it’s established. County housing administrators will operate the program under the authority of the Florida Housing Finance Corporation. The Florida program is separate from what the U.S. Department of Housing and Urban Development offers through the FHA program.

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