Homebuyer Tax Credit Approved by Senate

On Wednesday, the Senate approved more time for homebuyers seeking to claim a federal tax credit. The Home Buyer Credit can provide up to $8,000 for some first time home buyers and up to $6,500 for certain current homeowners.   Many of the qualifying home buyers were not be able to meet the June 30 closing deadline because of the surge in loan volume and delays related to home appraisals and short sales.

The homebuyer measure would help only those that entered into binding contracts before April 30. It would give such homebuyers until Sept. 30 to close the sale. Under current law, they would have had to have closed by June 30th to be eligible for tax credits.

The measure passed the Senate by unanimous voice vote.  President Barack Obama is expected to sign the homebuyer measure, which the House passed earlier this week.

Update: Homebuyer Tax Credit Extension Approved by Senate

On Wednesday, the Senate approved a proposal to extend the closing deadline on the tax credit of up to $8,000 for home buyers.  As you recall from our previous blog the House had already approved the extension.

The proposed bill will extend the date of closing for eligible home buyers to September 30 to give lenders more time to process a crush of applications. 

The Home Buyer Credit can provide up to $8,000 for some first time home buyers and up to $6,500 for certain current homeowners.   It is feared that many of the qualifying home buyers will not be able to meet the June 30 closing deadline because of the surge in loan volume and delays related to home appraisals and short sales.

We’ll be following developments.

Will the First Time Home Buyer Credit Continue?

Earlier this week, the Washington Post reported that the Senate is considering extending the time home buyers may complete their purchases.  The proposed bill would extend the date of closing for eligible home buyers to September 30 to give lenders more time to process a crush of applications.  The extension language is moving through the Senate attached to another bill that would extend a variety of tax breaks as well as emergency unemployment benefits.  

But this extension is only for home buyers that have already signed a contract to purchase a qualifying property by April 30.  Under the existing law, those home buyers must close on their transactions by June 30, 2010.

The Home Buyer Credit can provide up to $8,000 for some first time home buyers and up to $6,500 for certain current homeowners.   It is feared that many of the qualifying home buyers will not be able to meet the June 30 closing deadline because of the surge in loan volume and delays related to home appraisals and short sales. 

If you are a first time home buyer under contract, we encourage you to contact your closing attorney to make sure that the closing does indeed occur prior to June 30, 2010.