Most analysts agree that the U.S. Senate will approve extending the $8,000 first-time home buyer tax credit, perhaps as soon as later today. The first time buyer credit as it now stands is set to expire November 30, and many feel that if it lapses, the real estate market will experience a major buzz kill and economic recovery will stall.
Senate leaders appear to agree, and a vote could happen very swiftly on a measure drafted by Senate Majority Leader Harry Reid (D-Nevada) and Senate Finance Committee Chairman Max Baucus (D-Montana). This would extend the tax incentive until the end of 2010, but slowly phase it out during 2010. The full $8,000 could be claimed for property closed by March 31 of 1010, then the credit amount would then drop to $6,000 in the second quarter of the year, $4,000 in the third quarter, and $2,000 in the fourth.
Sen. Johnny Isakson (R-Georgia) and Senate Banking Committee Chairman Christopher Dodd (D-Connecticut) also have a proposed home buyer tax credit amendment. Their version would make the tax incentive available to all who purchase a home (not just first-timers). It would extend the tax credit until June 30, 2010, and raise the income limits to $150,000 for an individual or $300,000 for a couple.
HUD Secretary Shaun Donovan told senators last week that there was “clear evidence” the tax credit benefitted the housing market, but he said the real issue is whether an extension is worth the lost tax revenue. The proposal would “be very expensive, especially at a time of significant budget deficits,” Donovan said.
So stay tuned. If the only thing holding you back is the fact that you aren’t a home buying “virgin,” your day may be coming. Get a jump on everyone else now and start your loan approval process. Continue reading ‘$8,000 Credit Extension News’
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