My Financial Healthcheck

The N.J. Housing and Mortgage Finance Agency has started a new loan program that will allow its 1st-time homebuyers to take immediate advantage of a federal tax credit for people buying their first home.  Eligible households can get a loan up to $5,000 in anticipation of receiving a federal tax credit shortly after filing their tax returns.

Qualified persons who purchase a home for the first time by 12/1/09 are eligible for up to $8,000 federal refundable tax credit under the economic stimulus plan President Obama signed into law earlier this year.  Homeowners do not get the tax refund until after filing their tax returns.

The HMFA wants to give people the opportunity to get an advance on their credit in the form of a pre-fund loan.  Income eligible homebuyers will receive a TCLP prefund loan which is essentially a zero percent bridge loan that the homebuyer will pay back once they receive their federal tax refund, after filing their federal tax returns.  The TCLP prefund loan must be used for down payment and/or closing costs.  The home owner may combine the TCLP loan with the HMFA’s down payment and closing costs program known as Smart Start to further assist with their down payment and closing costs.