Legislature approves program to help first-time homebuyers

Washington Realtors just sent out a press release about a program approved by the state Legislature that would create a loan for first-time homebuyers, so they could get the $8,000 tax credit — available for first-time homebuyers — sooner.

(If you’re a first-time homebuyer in the market, you probably know about the federal tax credit that was part of the stimulus: Buy a house for the first time, get $8,000 taken off your tax bill. Some restrictions and fine print apply.)

The program approved by the Legislature would allow homebuyers to loan that $8,000 from a state-sponsored program so they could put the money toward a down payment or closing costs.

From the press release: “The program authorizes the state treasurer to deposit $25 million in a financial institution, which would then open a line of credit for the Washington State Housing Finance Commission (HFC). The HFC would use that credit line to pay for down payment loans to first-time buyers. Buyers repay the advance loan after filing for and receiving the tax credit.”

There is another way to get the $8,000 in your pocket before it’s time to buy, without taking a loan: If you’re buying a home later in the year and have some restraint, you can reduce your federal income tax withholding so that your tax burden is $8,000 less that what it would be otherwise.

Tags: real estate