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4 Ways to Get Assistance
First-time buyers—perhaps the largest segment of the market due to lower, more affordable prices—may be able to improve their financial position by taking advantage of local, state or federal incentive programs.

Tax-exempt Bonds. In October, Florida approved $571 million in tax-exempt bonds following passage of the federal Housing and Economic Recovery Act of 2008. The bonds will make funds available for lower-interest loans to first-time homebuyers with low and moderate incomes, and will leverage state-funded downpayment assistance programs. Eligible borrowers have to meet certain criteria.

State Funding Programs. Florida also provides funding programs that can help moderate income buyers that may help to cover downpayment and closing costs. For more information on state programs, go to floridahousing.org.

Tax Credit. The U.S. Housing and Economic Recovery Act of 2008 includes a $7,500 tax credit for first-time buyers on the purchase of a home over $75,000 between April 9, 2008 and July 1, 2009.  While the tax credit would have to be paid back in equal installments over a 15-year period, it is expected to stimulate housing sales across the country.

FHA Loans. The new federal law also raises the maximum Federal Housing Administration (FHA) loan limit to $625,500. With more affordable home prices, FHA loans are in reach for more buyers. One downside: The required downpayment on FHA loans would increase from 3 to 3.5 percent, and seller assistance on those FHA loans would no longer be allowed.