First Home Affordability Act

Key Points

• Congress is considering a bill that would give first-time homebuyers a tax credit worth up to $25,000. This money is meant to help people who have not owned a home in the last three years finally afford to buy their own place.
• A unique part of this plan allows buyers to give the credit directly to their mortgage lender at the time of purchase. This means the $25,000 could be used immediately as a down payment, rather than making the buyer wait until they file their taxes the following year.
• While most people would receive the credit in smaller pieces over five years, certain workers like teachers, firefighters, and childcare providers would get the full $25,000 all at once during the year they buy the home.
• To make sure the help goes to those who need it most, the credit is limited based on how much you earn and how much the house costs. Generally, your income cannot be more than 150% of the average income in your specific area to qualify.
• If a homeowner sells the house or moves out within a few years of buying it, they might have to pay back part of the credit to the government. This rule is intended to encourage people to stay in their new homes long-term.