First-Time Home Buyers Present Opportunity for Brokers

Posted on 05. Jun, 2009 by Patrick Connelly in News

The recent drop in home prices, along with the government’s $8,000 tax credit, has flooded the real estate market with first time homebuyers. Generally a segment of the market that receives little attention, a few recent developments have opened a door for Realtors in this growing market.

The most advantageous development when the first time buyer(s) are using Federal Housing Administration financing along with the government tax credit. When FHA financing is being used, the $8,000 can be turned into cash to help pay closing costs to the broker. Whereas in the past this section of the market may not have had the finances to pay for broker assistance, the ability to turn $8k into “cash” (essentially it is a short term loan from the FHA) makes first time homebuyers an interesting and viable target in an otherwise struggling market.

It is a simple process to obtain one of these loans if at least one of the buyers qualifies for the government tax credit. Some, or all, of the $8,000 can be loaned to help pay the closing costs and down payments, and the entirety of the loan must be paid back once the buyer receives his or her tax return.