Contrary to earlier statements the monetization of the 8 grand tax credit is much farther from implementation than was reported. As it stands now the Banks are not willing to provide bridge loans to people on the guarantee of an IRS tax credit alone. The reasoning behind this is that if the individual has to pay taxes then the 8 grand tax credit will be lower than the bridge loan given for a downpayment, thus leaving the bank on the hook for the difference.
For example, John Smith - first time homebuyer - uses his 8 grand tax credit for a down payment in the form of a bridge loan from Big Bank. When John Smith does his taxes later that year he discovers that he owes Uncle Same $5,200. The $5,200 is then taken from the $8,000 leaving Mr. Smith with only $2,800 left of his $8,000 tax credit. Now what is supposed to cover the bridge loan made to Mr. Smith for $8,000?
That is the question, isn’t it. So we will just have to wait and see what happens.