FHA Isn’t Giving it ALL Away
Fortunately, it seems that the government has decided against giving away EVERYTHING in the new program designed to try to entice first time home buyers to get into the market.
For a while it appeared that they were going to allow the $8,000 tax credit to be used as the down payment on the home. Right now with an FHA loan, a borrower needs to come in with at least 3.5% as a down payment. If they were allowed to apply the ‘government incentive’ (i.e. gift) as the down payment, that would mean they would essentially be purchasing a house with nothing down; nothing of their own invested in the property. Isn’t that sort of what got us into this whole mortgage mess to begin with? It only make sense that if someone wants to be a home owner and they want to take on the responsibility of a home mortgage, that they come to the table with a least SOME of their own money in the game.