Homebuyers who were under contract by April 30th and qualified for the original homebuyer tax credit, now have more time to close on their home due to a major backlog of mortgage applications. This amendment does not allow more time for additional homebuyers to qualify for the tax credit, but merely allows more time for those who have already qualified to close.
With this new approval, the closing deadline for the home buyer tax credit has been extended from June 30th to September 30, 2010. According to Senator Harry Reid of Nevada, the extension will allow lenders to clear a backlog of 180,000 homebuyers nationwide.
The amendment falls under the “American Jobs and Closing Tax Loopholes Act of 2010,” which also extends unemployment insurance benefits.
Senator Reid states on his website; “I am committed to ensuring that more Nevadans and Americans can become homeowners and that this amendment becomes law.”
According to the National Association of REALTORS®, about one third of applicants who qualified for the tax credit were told by their lenders that their loan will not close by June 30th because of the enormous volume of loan applications. Additionally, home builders have been working overtime to finish new construction homes in time to produce a certificate of occupancy for the closing deadline.
In a statement from NAR; President Vicki Golder says; “Since these applications were already in the pipeline and figured into the program’s cost, the extension of the closing deadline should not incur any further government costs.”
SOURCE: Inman News