Fist time home buyer-financing restrictions?

[Art]

Taxpayer (couple) never owned a home. They can not get a loan in their own name-don't have sufficient credit. Can parents co-sign on the loan and couple still get the credit? I know they can not get the credit if they acquire the home by gift or from a related party, but as long as they are legally responsible for the mortgage and their name is on the title will it fly? Could the parents make a cash gift to the couple and part of the gift proceeds then be used by the couple for the downpayment? Your thoughts?

[BHoffman]

Taxpayer (couple) never owned a home. They can not get a loan in their own name-don't have sufficient credit. Can parents co-sign on the loan and couple still get the credit? I know they can not get the credit if they acquire the home by gift or from a related party, but as long as they are legally responsible for the mortgage and their name is on the title will it fly? Could the parents make a cash gift to the couple and part of the gift proceeds then be used by the couple for the downpayment? Your thoughts?

I think they are good to take the credit.

[Gretel]

I agree, as long as they are the ones actually paying for the house, they are eligible for the credit. The mortgage has not much to do with this, some people pay cash.

[Art]

Thanks for the quick replies. The credit will really help them out.