The way the first time home buyer credit is written now, you have until November 30, 2009 (109 days as of 8/13) to close on your new home (if you qualify for the credit). Realistically, its earlier than that as Thanksgiving falls on November 26th. I’d be planning on closing no later than November 20th and even that may not be enough cushion if something goes wrong.
Will the buyer credit be extended? Who knows? Congress could let it expire, extend it or change it. The first iteration was the $7500 credit which was really a loan. Then it became a true tax credit for those that qualified under the rules of a first time buyer (interesting IRS scenarios).
On August 5th, House Representitive Harry Mitchell (AZ) said:
“The current $8,000 credit for first-time buyers has had a constructive effect on our housing market and I am happy to hear that Senator Reid supports its extension,” Mitchell said. “But we can do more. We should expand the tax credit by making it available to every qualified American who wants to buy a home, not just first-time home buyers, and should examine increasing the value of the credit as well…”
It looks like the next chapter is just starting to be crafted. There are no proposals on the table, just talk. It may already be to late to close a short sale within the time allowed. Some questions that will have to be addressed (my very partial list):
- Should there be (should there have been) a provision/amendment for an accepted offer on a short sale pending bank approval that misses November 30?
- Should “first time buyer” be dumped as a qualifier?
- Should it remain at $8000, be raised or lowered?
- How does Cash for Clunkers effect the government’s ability to continue the buyer credit?
- Should there be an Investor Tax Credit? What, if any, qualifiers would you put on that?