Info on 8K tax credit for home buyers

(FOX Providence) - You've heard about it by now. The $8,000 tax credit for new home buyers, but there are some details to that offer that might surprise you.

"It's available for first time home buyers and also for people who haven't owner real estate for three years. As long as you haven't owned real estate for three years, you qualify," said Realtor Ron Phipps of Phipps Realty.

There are some income limits, and you have to close on the house by the end of the year. November 30th is the cut-off date.

"It's a true $8,000 gift from the government. So, if you buy a property, when you go to pay your taxes next year, you'll get that full value of $8,000. If you only owe $4,000, the government will write you a check for the $4,000," added Phipps.

The FHA approved a plan, which isn't in place yet, to have that $8,000 available at the closing table.

"Also with the FHA, you can put it with your initial deposit as well now," added Ron Phipps' son, Matt Phipps.

For FHA, you have to have 3.5 percent down of the purchase price, "so you have to have this in addition to that," said Ron Phipps.

There are some restrictions to the plan. There's some income limits, and it phases out at $90,000 for a single person of income, and $150,000 for someone that is married.

"They're fairly high, but for the people of Rhode Island in particular, they'll qualify," said Ron Phipps.