Lilac City Real Estate

Tax Credit Extended

Home Buyers Tax-Credit Deadline Extended

UPDATE: July 2, 2010

Spokane home buyers with a qualified purchase contract are close to gaining more time to obtain a federal home-buyer tax credit of up to $8,000.  This mostly applies to people who purchased a short sale or REO home and need additional time for the financial institution to complete their internal review and concurr with the sale.

President Obama signed off on legislation today following approval in both congressional chambers earlier this week. This legislation extends the deadline for the home-buyer tax credit, giving buyers with purchase contracts in place three more months to close on the sale.

As of now, buyers have to close before Oct. 1 to be eligible for the extended credit. The closing deadline was originally June 30. To be eligible, buyers need a contract that was in place by April 30.

The National Association of Realtors has estimated that about 180,000 otherwise eligible buyers were likely to miss out on the credit if the original deadline was upheld. will save up to an estimated 3200 transactions in Washington state that qualified for the credit but were waiting to close. In addition to the very long queue of short sale approvals to be completed, it has been difficult for some buyers to get their mortgages approved on time, as lenders work through a clogged pipeline of applications. Spokane Real Estate.

 

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The U.S. Senate has amended a bill to give homebuyers who were under contract on a home purchase by April 30 an additional three months to close the deal and claim the federal homebuyer tax credit.

Extending the deadline for closing from June 30 to Sept. 30 allows lenders additional time to clear a backlog of 180,000 homebuyers nationwide.

The amendment to HR 4213, the "American Jobs and Closing Tax Loopholes Act of 2010" -- which primarily extends unemployment insurance benefits -- was approved in a 60-37 vote Wednesday. The vote was mostly along party lines, with only four Republicans in favor and one Democrat opposed.

The House passed an earlier version of the bill in December, and the Senate approved its own version in March. The Senate is currently working on resolving differences between the two bills.

The National Association of Realtors supports the amendment, saying Realtors have reported that as many as one-third of qualified applicants have been told by lenders that their loans will not close before June 30 because of the sheer volume of loan applications in the pipeline.

The amendment does not extend the deadline for homebuyers to qualify for the tax credit, NAR said in urging lawmakers to approve it, but simply extends the deadline for closing transactions already in contract.