PHFA offers Tax Credit Advance Loan — again

The wildly popular Tax Credit Advance (TCA) Loan program is back.

The PA Housing Finance Agency announced that it has allocated another $5 million to fund the TCA program, following the federal government’s extension and expansion of the homebuyer’s tax credit, said Kate Newton, PHFA director of Homeownership Programs.

PHFA’s Tax Credit Advance Loan program provides an interest-free loan to use toward down payment and/or closing costs. If the TCA is repaid by June 30, 2010, the borrower pays no interest for the loan.

First-time buyers will be able to receive up to $6,000 for new construction and $5,000 for existing homes, just like the PHFA program earlier this year, Newton said. PHFA will earmark $3.5 million of the total funds for first-time buyers.

“This time, PHFA will allocate $1.5 million of the funds for non first-time homebuyers, who must also fit the Internal Revenue Service (IRS) guidelines for the tax credit program. Non first-time buyers will be able to qualify for up to $4,000 for new homes and $3,000 for existing homes,” she added.

Don’t wait too long to apply for the funding because it only lasted four months earlier this year.

“We began offering loans in June and we ran out of money by the end of September,” Newton said. “It’s pretty amazing that a new program took off this fast. Toward the end of the program, we were giving out nearly $200,000 a day in advance loans.”

In four months, PHFA gave $5.75 million in advance loans on first-time mortgages totaling more than $140 million to about 1,300 Pennsylvania consumers.

To find a participating TCA lender, please visit phfa.org.