GA Home Buyers May get an Extension on the Federal Tax Credit

Today the Senate passed a bill 60-37 to extend the tax credit for first time home buyers from June 30, 2010 to September 30, 2010.  This is only for home buyers that went under contract on or before April 30, 2010.  Many lenders and people in Congress feel this is necessary due to the amount of home buyers that may not close on time to receive their $8,000 tax credit.   The national association of realtors is estimating  as many as 180,000 homebuyers are at risk of not closing on time.

There are many reasons for the delays.  One of the most common is waiting for a home to be completed.  There was such a surge of buyers trying to get new homes and take advantage of the $8,000 tax credit that builders have their contractors working day and night to meet the June 30th deadline.  As new construction goes, there have been a lot of construction delays.   The second most common delay is short-sales.  Short-sales can take months to get approved.  Buyers put contracts in before April 30th hoping to hear back soon whether their offer was accepted, but they are hearing back too late.  We have many Georgia home buyers that have just heard back this week and due to volume there is no way they will close by June 30th.  Most Georgia lenders have been running 45-60 days to close loans and now there are only 10 business days left in the month.

The bill still has to pass the House, so we are all anxiously awaiting a decision.  Congress said they had hoped to have this passed this week, but it may spill over into next week.  There is a lot of support behind the bill but some in Congress are worried about the cost of the extension.  It is estimated the extension will cost $140 million which is tough to stomach in this time of rising federal deficits.

Let us know what you think.  Should Congress extend or let it expire?

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