President Obama’s administration has helped to create an $8,000 tax credit for first time home buyers. Eager lenders are trying to capitalize on this tax credit by creating a “bridge loan” based upon the buyer’s eligibility to receive the credit. Essentially the buyer would borrow 100% of the money to purchase their home. The lender would provide a short-term $8,000 loan to the buyer for their down-payment which would be repaid as soon as the buyer received their $8,000 tax refund the next year. This would provide first-time home owners a great way to get into a home today (at record low fixed-rate mortgages) using their tax credit from next year. However, there have been some issues with the bridge financing and HUD.

According to a recent news article in The Arizona Republic, “HUD says bridge-loan program hasn’t been killed.” There are still some details to be worked out before this program becomes official but it will be a fantastic program to help first-time home owners utilize their tax credit to buy their first home and capitalize on the record low interest rates of today’s market.