“When it comes to the overall bill, part of it is very good and the other part of it is just a band aid. I’m always hesitant when the government gets involved,” says Charles A. McDonald, associate broker at RE/MAX Assured Properties in Charlottesville, Virginia. “But for a first-time home buyer, the tax credit is a good thing because it’s really not a tax credit; it’s really an interest-free loan. If you look at it from that perspective, it’s a nice incentive for the first-time home buyers or people that need some assistance in purchasing a home.”
Yes, the tax credit technically is a zero-interest loan that you will repay to the government over 15 years, starting two years after the credit is claimed, at $500 a year.