$8K tax credit downpayment challenges Florida officials

TALLAHASSEE, Fla. – July 8, 2009 – Trying to get the $8,000 tax credit downpayment loan to help a homebuyer? Local officials charged with administering the SHIP (State Housing Initiatives Partnership) program and, by extension, the Florida Homebuyer Opportunity Program’s (FLHOP) $8,000 tax credit bridge loan peppered state officials with questions yesterday in a conference call.

On the positive side, Florida lawmakers decided to offer a bridge loan to first-time homebuyers eligible for the federal government’s $8,000 tax credit through an existing state program. That gives the loan program an existing framework and avoids setting up a new system for disbursing money. On the negative side, the FLHOP program rules differ from SHIP rules, and local SHIP officials voiced a number of legal and pragmatic concerns over the new loan program.

In reality, the program likely kicks off on Aug. 1. It became effective July 1, but the funding mechanism for the loans also started July 1 without any money and must rely on current home sales’ doc stamp taxes to build the reserve.

In addition, some local SHIP officials may not have everything ready by the Aug. 1 date as they struggle to formalize rules and regulations. Since the Florida program operates as a type of mortgage loan, it comes with rules and caveats like many found in first or second mortgages. While up to $8,000 is advanced without interest or penalties if paid within the first 18 months, for example, loan docs must also address potential problems.

“Some (local SHIP officials) are really on top of this and are ready to go,” says Stan Fitterman, a member of the Florida Housing Finance Corporation (FHFC). “Others are very leery to start until the check is in the bank.”

In yesterday’s conference call, many local SHIP officials voiced frustration and confusion. While some of their questions were answered, it became clear that most of the policy decisions must be implemented on the local level.

As a result, Realtors who have questions must contact their local SHIP office. To find your local SHIP office, go to: http://apps.floridahousing.org/StandAlone/FHFC_ECM/AppPage_SHIPLGContacts.aspx

The Florida Housing Finance Corporation, which oversees local SHIP officials, released a FAQ list about the Florida Homebuyer Opportunity Program in conjunction with yesterday’s conference call. While directed to local SHIP officials, the FAQ provides some answers being asked by Florida Realtors. The complete FAQ can be found on the FHFC website at: http://www.floridahousing.org/Home/HousingPartners/LocalGovernments/FL_HOP.htm.

For additional tax credit info, videos, radio ads, an IRS form, posters, flyers, downpayment programs and REO resources, visit FAR’s Homebuyer Center at: http://www.floridarealtors.org/AboutFar/homebuyercenter/index.cfm.

© 2009 FLORIDA ASSOCIATION OF REALTORS®

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