Is the First Time Home Buyer Tax Credit a good thing?

When I first heard about this tax credit, I thought to myself, "who'll qualify for this? No one I know. the window of opportunity is to narrow. You have to purchase your first house between April 9th and July 1st of 2008."

Low and behold, I got an email from my good friend and bicycle mechanic Bill G. today. Bill works on my bike and I do his taxes. (Who's getting the better deal here? I'm getting off track.) Anyway, Bill and his wife Amy did buy their first house between those two dates andthey qualifies for the credit. It's up to $7,500.

On the surface, this looks like a great deal for anyone who qualifies. You'll get this refundable tax credit when you file your 2008 taxes. So do them as soon as you can.

There is a catch. This is really an interest free loan from the government/IRS. You have to start paying back this credit/this loan in 2010 and over a 15 year period. So, assuming you get the maximum credit of $7,500, you'll be paying back $500 a year for 15 years. If you sell your home prior to paying off this loan, the government will get paid off from the proceeds of the sale.

So I ask, is this a good deal or not? An interest free loan is appealing but a loan is a loan no matter what and as the Bible clearly states, the borrower is slave to the lender. (Proverbs 22:7) Personally, I do not want to be in bondage to the government/IRS for 15 years. With that said, if you could / would use this credit to clean up some other debts then this could be a good deal for you. But I have learned that having debt is usually a symptom not the problem in and of itself.