Are you planning to own a primary residence? If yes, then you can take help of first-time home buyers incentive programs offered by the state housing agencies. You can also claim the first-time homebuyer tax credit offered by the federal government, if you purchase a property by June 30, 2010. However, in order to take advantage of these programs, you need to qualify yourself as a first-time homebuyer. It means that you shouldn’t have purchased a primary residence in the past 3 years. A primary residence can be defined as a home where a person lives most of the time.

First-time homebuyer tax credit

The first-time homebuyer tax credit is a part of American Recovery and Reinvestment Act of 2009. The qualifying buyers are eligible to claim a federal tax credit of up to 10% of the home purchase value that amounts to a maximum of $8000 for individual buyers. Married couples can claim a maximum of $4000 if they file return separately. For married couples, both have to qualify as a first-time homebuyer in order to take advantage of the federal tax credit. However, the buyers need to sign the purchase agreement before 30th April, 2010 and close the property on or before 30th July, 2010.

First-time homebuyers incentive programs

Apart from the first-time homebuyer tax credit offered by the federal government, there are also some state housing agencies that offer first-time homebuyers incentive. Go through this section to know about such first-time homebuyer incentive programs.

• Prefund Program

The New Jersey Housing and Mortgage Finance Agency’s Prefund Program offers interest free loans up to a limit of $5,000 in order to help the first-time homebuyers to purchase a property. This loan is intended to help the buyers with closing costs along with other miscellaneous expenses regarding buying a new home. However, you’ll have to buy a property within June 30, 2011 in order to qualify yourself for the homebuyer incentive program.

• CalHFA loan programs

If you’re a first-time homebuyer and planning to purchase a property in California, then you can take help of several payment assistance programs offered by the California Housing Financing Agency (CalHFA).

Some of the mortgage loan programs are discussed below.

* Conventional loan program – The first-time buyers can obtain a Cal30 conventional mortgage with a 30-year fixed rate of interest. The maximum LTV (Loan-to-Value) of a Cal30 loan is 95% and the maximum CLTV (Combined Loan-to-Value) is 102%.

* REO (Real Estate Owned) loan programs – The CalHFA ‘Community Stabilization Home Loan Program’ offers a mortgage with reduced interest rate when you purchase a REO property. You can also take help of SMART loan program to take out a home loan with 100% LTV financing.

You need to satisfy the eligibility criteria in order to take help of first-time homebuyers incentive programs offered by the state housing agencies along with the first-time homebuyer tax credit offered by the federal government.