New Program to Help First Time Home Buyers
May 3rd, 2009Posted by Jim Reppond
A new program is about to roll out to help first-time home buyers. So far it’s been reported about in a couple of places I could find, The Capitol Record in Olympia, and a short article in the Seattle Times. But I think this is going to be a big deal. I first heard about this from one of the representatives in our office to Washington Realtors. Now, those who know me well know that I am usually a major critic of both the National Realtor Association and the Washington Realtors. But if this program actually comes out in the format they are talking about, I may be converted to a fan after all. It not a done deal yet, but it’s getting close and if the minor IRS regulation in the way gets changed quickly, it looks likely.
Here’s how it would work: Those who qualify for the up to $8,000 Federal Tax Credit would could use the funds in advance as down payment and closing cost assistance at the time of purchase.
The State legislature would allocate $25 million of state funds into interest-earning accounts at an FDIC-insured bank. The bank would provide a revolving line of credit to the Washington State Housing Financing Commission to greatly expand its down payment bridge-loan efforts. The Washington Realtors have pledged $400,000 as a backstop to cover any unexpected losses to the state. Prospective borrowers need to take a First Time Homeowners class administered by the Washington State Housing Finance Commission and may be required to assign their IRS tax credit refund to the lender. A second mortgage may be attached to their home if they fail to pay it back.
This could be just the kick in the pants that the market needs to jump start it back to life. Up to now, none of the federal or state programs have made a huge difference. The $8,000 credit only works for lower and middle income participants, exactly the people who often don’t have enough savings to purchase a home.
Watch for more to come…
6 Comments Add your own
1. todd | May 7th, 2009 at 2:52 pm
any updated information on this program…?
2. Jim Reppond | May 8th, 2009 at 5:03 am
No news yet, Todd. But I’m watching it closely. Looks like around the beginning of June before anything is likely to happen. And it may take longer before funds will be available to loan.
3. Kevin Skaggs | May 8th, 2009 at 5:33 am
Jim!
I’m Lisa Cooper’s assistant here at Prudential in Dana Point, CA. I just wanted to tell you how helpful your video clips are, it’s fun for me to keep my knowledge intake flowing while I’m assisting someone else. I like your attitude too, it’s seems that your in the game to be helpful to everyone in general, and I find your topics very relative, and interesting. I’ll be re-hanging my license to pursue my real estate career again here shortly, I just wanted to give you kudos for helping me stay sharp.
Thanks! And for God’s Sake, Don’t crash!!
Kevin Skaggs
kevinskaggs@prusocal.com
4. Jim Reppond | May 8th, 2009 at 5:51 am
Thanks for the kind comments, Kevin.
I find these short video auto-blogs give me a way to quickly cover a topic that I may not want to write a full-blown blog post about.
And getting to multi-task while I’m driving is just an added bonus!
Jim
5. Carl Self | October 21st, 2009 at 9:34 am
I like what you are doing. Keep up the good work. If you want to partner with another local professional that has a passion for Real Estate send me an email and let’s talk.
Carl The Seattle First Time Home Buyer
6. Real Estate Services | July 17th, 2010 at 3:36 am
This is a wonderful opinion. The things mentioned are unanimous and needs to be appreciated by everyone.
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john
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Real Estate Services
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