To amend the Internal Revenue Code of 1986 to allow a refundable credit for the purchase of a principal residence by a first-time homebuyer and to amend the National Housing Act to prohibit the Secretary of Housing and Urban Development from limiting the amount of closing costs financed in connection with a loan insured under the single family housing mortgage insurance program.

Amends the Internal Revenue Code to allow a first-time homebuyer a tax credit of ten percent of the purchase price of a principal residence. Limits such credit to $5,000.

Amends the National Housing Act to prohibit the Secretary of Housing and Urban Development from limiting the closing costs financed under the Federal Housing Authority single family housing mortgage insurance program.