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On June 16, the Senate approved a plan to give homebuyers an extra three months to finish qualifying for federal tax incentives.  If the plan passes, it means you’ll have until September 30, 2010, to close on your Inland Empire home and qualify for tax credits of up to $8,000.  (First-time buyers were eligible for a tax credit of up to $8,000. Current owners who bought and moved into another home could qualify for a credit of up to $6,500.)

Who Qualifies?

Originally, you had to sign a contract to purchase a home by April 30, 2010, and close no later than June 30, 2010.  With this extension, anyone who had a signed purchase agreement by April 30 would have until September 30 to close on the sale of that home.

Why the Extension?

Mortgage lenders have been swamped with borrowers trying to get their Inland Empire home purchases approved by June 30.  Many potential borrowers are having difficulty meeting that deadline. 

The National Association of REALTORS® (NAR) estimates that 180,000 buyers are likely to miss the June 30 deadline "because of delays in the process." That's particularly true of short sales, the NAR noted.

Is it Approved?

Unfortunately, an extension of the deadline for the federal homebuyer tax credit remains tied to Senate legislation that would extend unemployment benefits, complicating efforts to get the deadline extended before the expiration date of June 30. 

But don’t give up hope.  If lawmakers extend the deadline after June 30, the language in both the House and Senate bills will apply retroactively.

Have questions about the federal tax credits?  Or any other questions about Inland Empire homes?  Give me a call today at (909) 938-9568 or email me at Randy@TeamCharlton.com.  I’ll respond promptly and personally.

Brought to you by Randy Charlton of Keller Williams Realty.

Senators have agreed to extend the $8,000 first-time homebuyer tax credit originally set to expire on November 30. Once the Senate officially votes on the bill it will move to the House of Representatives, which strongly supports the extension. The Obama administration has also signaled its strong support for an extension of the tax credit.

Aside from the first-time homebuyer credit, the new plan would offer a $6,500 credit for repeat or move-up homebuyers who have lived in their primary residence for five years or more. The tax credits would be available to buyers who sign purchase agreements on a new or existing primary residence between December 1, 2009 and April 30, 2010. Buyers would have until June 30 to close on their new homes.

There is an $800,000 price limit on all homes eligible for the credit. The income limits for all buyers would rise to $125,000 per year for individuals and $225,000 for married couples. Under the current program, the limits are $75,000 and $150,000 respectively. The first-time homebuyer credit is also available to those who have not owned a home in the previous three years.

The credit does not have to be repaid unless the home is sold or ceases to be the primary residence within three years.

According to the Treasury Department, more than 1.2 million borrowers have claimed $8.5 billion of the $13.6 billion set aside for the first-time homebuyer tax credit.

Please be advised that this legislation has not yet passed, but I will be sure to keep you informed as it moves through Congress toward approval. I’m committed to meeting your real estate needs. Call me if you have any questions!

Brought To You By Randy Charlton Of Century 21 Home Realtors.