An Extension of the $8,000 Home Buyer Tax Credit is Closer

As we approach the November 30th deadline, we have some encouraging news on the extension of the $8,000 home buyer tax credit. It’s not a done deal but the news is looking pretty good. Wednesday the Senate reached an agreement to extend the tax credit for first time home buyers. In a new twist, they are including a $6,500 tax credit for buyers who are not first timers. They also raised the qualifying income limits in a very meaningful way... singles were increased from $75,000 to $125,000 and joint taxpayers from $150,000 to $250,000. The Senate wants the qualifying period to be extended to purchase agreements executed by April 30, 2010 and allow buyers until June 30, 2010 to close their escrow.

The House and Senate now have to reconcile their versions of the tax credit and create a final bill to be voted on before the legislation will take affect. Both Houses have different ideas of what the home buyer tax credit should include so it will be interesting to see what they decide on.

Here's my take away from this news. Regardless of the provisions in the final bill, those of you who are actively making offers on homes now have some breathing room. If you’re motivated by the tax credit and have put off your home buying plans until next year, you’ll want to keep the April 30th deadline in mind. I’ll be back with another update once a final bill has been voted on and the details become available.