June 7th, 2009 by Michael Oliver

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Starting soon first time buyers who currently receive an $8,000 Federal tax credit with a home purchase will be able to use that money for their closing costs if they use FHA (Federal Housing Administration) financing on that home purchase. First Time home buyers in Tucson will still need to be able to put the standard 3.5% down payment down on the home purchase but instead of also having to pay the closing costs out of pocket (Or having to get the seller to pay for it through negotiation) the buyer will have the option to use a portion (or all) of the $8,000 federal tax credit to cover closing costs. Closing costs are those costs associated with providing the buyer financing these costs include appraisal, processing, underwriting, credit report, title, and loan origination fees.

The $8,000 can even be used as an additional down payment (in addition to the minimum required). Or home buyers can use the monies to “buy down” an interest rate. To qualify for the first time tax credit (up to $8,000) buyers must not have owned a principle residence in the past 3 years and household income cannot exceed $95,000 for a single taxpayer and $170,000 for married couples filing jointly.

For buyers wanting to take advantage of this first time homebuyer Federal Tex credit they should move quickly as it is only available to buyers who buy and close on their home purchase no later then November 30th, 2009!