Community Development Block Grant
CDBG's First Time Homebuyer Program
What is it?
Beginning August 1st, the Office of Homeownership established a new program designed to
assist first time homebuyers. The program, the Community Development Block Grant
Program, can give qualified first time homebuyer $5,000 toward down payment and
settlement expenses.
Who is eligible?
First-time Baltimore homebuyers with a counseling certificate from a City Approved
Counseling Agency.
Upon receiving a counseling certificate, the borrower can then find a property and sign a
contract to purchase. Once executing a contract, the borrower must bring that contract back
to the Counseling Agency to have the CDBG program application completed. The property
must be inspected utilizing an HQS inspection. Please be absolutely certain that there is no
peeling, flaking, chipping paint inside or outside the purchased property.
Additionally, active City employees may already qualify to receive $3,000 in home buying
incentive funds. If you attend the Eastside Trolley Tour September 12th at City College High
school, you may qualify for another $3,000. Also, if you purchase before November 30, you
may qualify for the $8,000 Homeownership Federal Tax Credit.
What are the benefits?
A possible combined amount of $11,000 in incentive money and a possible $8,000 tax
credit.
What are the restrictions/loan terms?
The funding source for the CDBG program have 80% median income limitations. You must
be within the income limitations to qualify for this program. The income limitations are as
follows:
1 person $44,800
2 person $51,200
3 person $57,600
4 person $64,000
5 person $69,100
6 person $74,250
7 person $79,350
8 person $84,500
Many first time home buyers and current homebuyers have already taken advantage of the extended tax credit, but the deadline for this unprecedented window of opportunity is quickly approaching. With the average home buying process taking about 60 days, buyers should be searching now. Meanwhile, sellers should have their properties on the market to comfortably meet the April 30th deadline to be under contract.
A first-time buyer, which includes anyone who hasn't owned a home in the past three years, may be eligible for up to an $8,000 credit on the purchase of a primary home. Current homeowners looking to move up or downsize to another primary residence may be eligible for up to a $6,500 credit.
The initial tax credit and recent extension were great news for the housing market and overall economy. Sales began to increase and the economy saw signs of recovery.
Some buyers received tax credit checks within a few weeks of filing their amended returns, enabling them to replenish savings for closing costs, make upgrades to their new homes or simply put away some extra cash.
This enormous opportunity still awaits buyers and sellers today. Coupled with historically low interest rates and unprecedented home affordability, it is an opportunity not to be missed, but time is of the essence.
If you or someone you know would like to discuss how to take full advantage of either tax credit before the April 30th deadline, or to discuss selling your home, I have the expertise to assist you.
Great article that came out today outlining the upcoming changes to FHA loans.
