In rapidly increasing frequency, first-time homebuyers in Florida are taking advantage of a little-known program that pays them $2,000 a year to buy a home.
According to a report from The Sun-Sentinel, participation in the Florida Housing Mortgage Credit Certificate Program tripled in the last year.
From the Sun-Sentinel report:
The state-run Florida Housing Finance Corp. runs the program, which gives first-time homebuyers money back each year based on how much interest they pay on their mortgage.
Once approved, low- and moderate-income homeowners can claim up to half of mortgage interest they paid as a tax credit on their federal income tax return, said Cecka Rose Green, communications director of Florida Housing Finance. The credit is capped at $2,000 each year, she said.
"It's a $2,000 reduction, dollar for dollar," Green said. "It keeps money coming back to homeowners."
According to the Sun-Sentinel report, the tax credit is good for the life of the mortgage, even if it’s a 30-year mortgage.
The program started in 2005, but the housing crisis derailed it.
The program was restarted two years ago, attracting 157 homebuyers the first year. In 2014, the number of participants grew to 523, tripling the previous year’s total.
Again from the Sun-Sentinel:
Two years into the restarted program, many first-time buyers still don't know about it, said Adam R. Cohn, branch manager of Standard Mortgage Co. of Boca Raton.
The program has another advantage beyond the yearly money back, Cohn said. "The beauty of the program is that homebuyers can use that income to qualify for a loan," he said. "That helps buyers qualify for a higher mortgage."
The state is expecting the number of participants to rise again in 2015, citing an improving housing market as a reason that more potential buyers will become actual buyers this year.