Whether or not you can “monetize” the 8000 tax credit in the form of a bridge loan has not been made official. But apparently people are making plans and even announcing that they are doing it.

For example, the Memphis Area Home Builders Association have announced that they are ready to go and are now giving out bridge loans for the 8000 tax credit so that people can “monetize” their money now and essentially move into a home with no money down.

From the article:

Officials at the state’s second-largest homebuilders trade association say the program – the first of its kind in the nation – could jumpstart the county’s sagging new home sales by giving potential homebuyers access to money at closing instead of making them wait for their amended tax returns, which can take weeks or months to receive.

MAHBA’s program has been approved by the U.S. Department of Housing and Urban Development for buyers who qualify for Federal Housing Administration loans up to the $271,050 limit, said association president Stephen Hodgkins and executive director Don Glays.

Hodgkins and Glays said MAHBA has allocated $800,000 to its nonprofit arm, MAHBA Foundation Inc., so it will be able to handle 100 of these new loans at any one time. Once a loan is repaid with a buyer’s tax credit, the account is replenished for another applicant.

“This means Memphis Area Home Builders Association (members) can sell homes by loaning people their down payment so they can get in basically for no money down,” said Hodgkins, owner of Oaktree Homes LLC. “But that (loan) is to be repaid by the assignment of their tax credit.”

And more about the person who thought up this program:

The MAHBA program was the brainchild of Glays, who was dismayed to see the seller-assisted down payment program disappear last year. The new rules said buyers couldn’t borrow their down payments and secure them with the property they were purchasing.

But Glays began researching HUD rules and found out that an “anticipated tax credit” was exempt. “Under HUD rules, any anticipated cash coming in can be used as part of the qualifications for underwriting a mortgage,” he said.

This program doesn’t secure the down payment with the property, but rather with the assignment of the tax credit. Glays said if you know you’ve got money coming in from any source, “you can get a mortgage on the premise that you’re going to get that money and it’s going to be liquid for you to use.”

We have yet to hear of anything in California that makes the 8000 tax credit in the form of a bridge loan official.

But we will be sure to keep you posted as we know more. Things change every day and this can easily change.

This answer was much different than just a couple of years ago – I was cleaning out a box of old work files and came across a marketing piece from one lender in 2005 that said something like:

• No Credit?
• No Assets?
• No Job?
• No Problem!

While it may have been true in the past, now in 2009 lenders have tighter guidelines than they have in the last few years and credit scores are more important than ever.

What is the minimum credit score that you can have and hope to qualify for some kind of loan?

620.

And that 620 needs to be your middle credit score, not your highest one. You have a credit score from each of the big three bureaus and the one that lenders look at is the middle one.

Now for a few exceptions.

With an California FHA streamline or VA streamline program, there are still a few lenders who are not requiring a minimum credit score, only that you have been on time with your mortgage and have no more than one 30 day late payment in the last 12 months. Note that I used the word few. Most lenders are now requiring at least a 620 minimum credit score.

Other than the FHA / VA Streamline programs?

Plan on having at least a 620 credit score to qualify for a loan.

Any loan.