HUD retracts the tax credit for down payment offer

Just as fast as they gave it, HUD took it away.  In an annoucement Friday afternoon that said, but didn’t say it out loud, HUD Secretary Shaun Donovan didn’t know what he was talking about when he said (for the second time in a month – will somebody please brief him about what’s going on in his own agency) that HUD would be allowing the $8,000 first-time home buyer’s tax credit to me immediately moneytized through certain government agencies and non-profits to be used as the down payment or toward closing costs of buying a new home.

Maybe a good thing anyway, as I said in my last post it will all depend on those government agencies and non-profits stepping-up to the plate and loaning the $8,000 at the closing table.  The big issue was that nobody wanted to do it without a guarantee that they’d be repaid through such avenues as the borrower’s tax credit being sent directly to the lender rather than to the taxpayer.  So even though the offer was on the table, there wasn’t any takers.

The fun part will be seeing how Shaun Donovan puts his foot in his mouth next week.

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