Tax Credit Extension

I have been getting a lot of questions about both the current first time home buyers tax credit, and the proposed extension. The main question regarding the current tax break is whether or not it's too late to take advantage. In simple terms, it depends. Most likely if you need FHA or conventional financing it's too late. With the delays in funding and the Thanksgiving holiday, it's going to be tough to get it closed by the end of November. However, if you have cash or a really fast mortgage broker, it is still possible. So, I would say try to close by the end of the month, but home it gets extended.

Now, as for the proposed extension, there are actually some new things being added that could help out. First off, it allows the current credit to be extended until the end of April 2010. According to Bloomberg, there is also another key addition to the bill. They stated that:

Homebuyers who have lived in their prior residences for at least five years may receive a credit of $6,500 under the plan, said Senate Finance Committee Chairman Max Baucus. Also, couples earning as much as $225,000 and individuals as much as $125,000 would qualify for the extended break, Baucus said. That’s up from a $75,000 limit for individuals and $150,000 for couples.

If this is the case, I think this will be huge! This will give incentive for those people that have been considering upgrading a reason to pull the trigger. It will also bring new inventory to the market for the first time home buyers. From what I've read, we should have a vote on the bill this week. I'm crossing my fingers and I would suggest calling your senator to be sure they vote for it!

I'm always here for questions if you have them!