The Disappearing Time Table for the Home Buyer Tax Credit

First Time Buyer Tax Credit Time TableWill you be able to find a home and close in time to receive the $8,000 tax credit?

Let’s look at the home buying time line and discuss some of the pitfalls you’ll want to consider before spending any more time sitting on the fence or gambling on short-sales.

What We Know:

Time Factors for Each Party in the Transaction:

Depending on who owns the home and what process they are using to facility the sale, will vary greatly from home to home. Here’s a breakdown of how long each major phase of the sales process takes. Take note of the never ending list of reasons for a short sale to be delayed.

Bank Owned | Foreclosure Homes

Owner Owned Homes

Short-Sales

Lender Process (assuming you are prequalified)

Realtor Process

Summary of Time Factors

If you know what type of property you are considering, this breakdown will give you an idea of how soon you should submit your contract in order to have ample time to close and reach the deadline.Planning for the Home Buyer Tax Credit Deadline

Buying a Bank Owned Home

Buying an Owner Owned Home

Buying a Short-Sale Home

Consider This:

Here are a few additional things to consider to help ensure your home closes on time for the tax credit deadline.

November Will Be a Crazy Month
With everyone trying to close on their home by November 30th there will be a lot of closings happening in November. You can expect title companies and loan processors to be overworked and exhausted. Which means you could see an extra two week delay in closing just because of the overwhelming amount of paperwork.

Give Yourself a Few Extra Days to Close
With everyone being in a rush to close a large volume of homes and loans, it is a good idea to buy yourself sometime to make sure there aren’t any typos. A small error on the lender or the title rep’s part could cost you a few thousand dollars. Make sure your Realtor is looking over the HUD statement to make sure it all looks right.

Common Questions:

When Will We Know about The Next Tax Credit?

I predict we will hear about the next tax credit either during November or two days after the November 31st deadline passes.

Why? Because that is when it will be too late for anyone to change their mind and it will be perfect timing to keep the housing momentum going.

What Will the New Tax Credit Look Like?

4 main rumors are floating around about the next tax credit:

  1. It will revert back to the original tax credit which was more like an interest free loan
  2. It will be the same as this year’s
  3. It will be increased to $15,000
  4. There will be no tax credit, because the economy is already starting to recover

Out of the four options, only two of them are options worth holding out for. Which means, holding out for next year’s tax credit could be a gamble and essentially there is only a 50% chance there will be a program available.

3 Quick Tips to Reduce Your Risk of Not Closing on Time

Skip  the short-sales

Play nice, kiss buttPut It In Writing, It Means More

Communicate

Email us with any questions or comments!

Related posts:

  1. Time's Quickly Ticking for the $8,000 Home Buyer Tax Credit
  2. Current Workout Programs Accepted Most Banks
  3. What Closing Costs Do You Have to Pay for at the Closing Table?
  4. 5 Best Questions Asked When Buying a New Home
  5. Can I Pay Someone to Just Repair My Credit?

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