NJ First Time Home Buyer Tax Credit LOAN
http://www.state.nj.us/dca/hmfa/consu/buyers/ownprg/tclp.html
It looks like everybody is doing it again - helping First Time Home Buyers (FTHB) - Buy a Home with another LOAN package. I hope that for the sake of the first time home buyer (FTHB) that this doesn't become a nightmare.
Basically, this sounds like the FTHB is going to borrow money from their own future 2009 Federal Tax FTHB Credit of up to $8,000.
Therefore, if the buyer needs additional money for down payment and/or closing cost - they could go to their state agency - borrow up to $5,000 - then after they apply for their tax credit - the no interest loan is paid back with this Federal Tax Return.
I like this idea. And I am glad that the program is helping families buy their first home. But this entire process - if I am not mistaken - is based on helping families that can't save enough for the purchase of a home. Hummm
I prefer a saving incentive such as the Individual Deposit Accounts (IDA) where the banks match money saved by the family for the purpose of buying a home. The money belongs from the family and the Bank; no more government money and the family learns a good lesson - SAVE money for your Home and Family.
Therefore, I warn FTHB to use this program - the TAX CREDIT LOAN - with CAUTION.
Georgia has a DCA program too. The buyer has to go to a class. I had one buyer say it was too much trouble. To which I responded a 14k credit for 6 hours in a class on one day. Have you done the mathc and seen how much you make per hour?
There are some great programs out there
I am 100% in favor of programs that require a class/workshop. It demands something from the buyer other then just an application. But my preferance is the matching funds programs because it obligates the buyer to save for the future. And this is a deal when it comes to homeownership.
By the way, could you add the link to this blog about the GA program?