Time is running out on the $8,000 home buyer’s tax credit

October 21, 2009  |   Posted in Credit Education, Credit Guy Blog, Industry News   |   0 Comments  

What’s that ticking sound?  You’re probably hearing the clock counting down on the $8,000 tax credit for qualified home buyers.  The tax credit, part of the American Recovery and Reinvestment Act of 2009, is set to expire Nov. 30, 2009.

That means anyone who has never owned a home before or has not purchased a home with an FHA mortgage in at least 3 years,  has just days to close on the purchase of a home and receive a tax credit of up to $8,000.  Time is certainly slipping away.

Potential home buyers are encouraged to move quickly. If you’re already working with a lender and have been pre-approved, there is probably still time to buy.  Using a conventional loan and having a down payment is available will improve your chances considerably.

The numbers show clearly that the tax credit has spurred sales, especially of lower-price homes typically purchased by first-time buyers.  Many home buyers questioned have admitted readily that they were buying now specifically because of the $8,000 carrot.

There may me hope for people who haven’t started yet though.  There’s rumblings from the President and in Congress about extending the program at least through next summer, and possibly raising the credit to $15,000.  We’ll just have to wait and see at this point what happens.  Without a new credit home sales will decline again, worsening the economic crisis.  Programs like this are a slippery slope for the country, but then again, if it helps families achieve the American Dream it can’t be all bad.