That amendment was part of a larger piece of legislation referred to as the “Extenders Bill.”

Unfortunately, the bill failed passage in the Senate three times this week.

The National Association of REALTORSâ is working closely with key Members of Congress, the Senate, and Senior Congressional Staff on the extension of the June 30, 2010 closing deadline for contracts eligible for the Homeowner Tax Credit.

The best advice is to proceed with any pending transactions as if the June 30, 2010 closing date will remain final and binding.

NAR is pursuing all possible options with senior congressional staff to determine what other legislation may be available for passing a June 30 extension.  Each of the possible options presents difficult obstacles, but NAR’s efforts to clear the way are ongoing.

The Senate will NOT have any votes today (Friday, June 25).  This will push the Tax Credit Extension deadline to the week of June 28, 2010.

Should Congress extend the date, information will be posted on www.realtor.org/government_affairs as soon as it happens.

The final outcome will be posted on www.realtor.org/government_affairs on July 1, 2010.

We will provide updates on this issue as they occur.  If you have any questions or need additional information, please contact me at 513-842-3014 or mquarry@cabr.org.

The amendment (introduced by Sens. Harry Reid, Johnny Isakson and Chris Dodd) is now part of a much larger emergency spending bill – which includes extension of certain unemployment benefits, increasing Medicare payments to physicians and flood insurance – to name a few.

Timing

Senate Majority Leader Harry Reid will likely file cloture today which means the Senate could vote on the entire emergency spending bill early next week (week of June 21st).

The U.S. House of Representatives would then need to approve the extension, likely to occur by the middle to end of next week (week of June 21st).

Assuming the House approves the extension, it then would go to President Obama for his signature, at which time it would become law.

What does this mean?

All indications are that the extension of the Closing Deadline is likely to occur.

However, as with any piece of legislation being considered by Congress, there are no guarantees until the final votes occur.

In the meantime

If you have a pending closing(s) for “tax credit” buyers, it would certainly be in your best interest to continue to work to complete them by the existing June 30 deadline.

We will provide updates on this issue as they occur. If you have any questions or need additional information, please contact me at 513-842-3014 or mquarry@cabr.org.

Take Care,

Mark

Mark J. Quarry

Director of Government Affairs

Cincinnati Area Board of REALTORSâ

The last weekend of the tax credit produced a high water mark for pending activity since we started reporting these numbers last summer. 200 pendings over the weekend shattered the previous high mark by over 20 homes, 181 in October 09.

The Home Finder Network was successful in helping dozens of buyers and sellers come together during the tax credit period. We have expanding our database and are in the process of working several other project. We want to extend our gratitude to all that have been apart of our business during the past 12 months and we look forward to helping families for years to come.

Another reason for buyers to purchase and take advantage of the tax credits!

Beginning on April 5th Upfront Mortgage Insurance Premiums for FHA loans will increase from 1.75% to 2.25%.

Example on a $150,000 purchase price utilizing maximum FHA financing the financeable UFMIP will increase by $723.00 (again this is a financeable expense). This will increase the loan amount for all borrowers going forward (premium is calculated based upon the actual base loan amount with a minimum 3.5% down payment).

As we all know, contracts must close by June 30, 2010 for the buyer to qualify for the tax credit.

At the same time, we know that some closings take longer than others, like short sales and bank owned properties. This delay may cause the closing to take place after the deadline, costing the buyer $6,500 or $8,000.

So if you have a buyer who is looking at a short sale property, you may want to warn them that the closing could be delayed past the deadline. You could even suggest a different property.

If they remain intent on buying the short sale property, then you should try to protect yourself. An easy way to do this is to have something in writing stating that you have warned them of the potential problem. This will keep you and REMAX out of hot water if and when the client tries to say you didn’t tell them this could happen. We already know how much they will want from you.

The properties showing the most delays are;
Short Sales
Bank owned REO (especially those that do not have a deed recorded yet.)
Condominiums

There are certainly others that will sound alarms for you, like property with tremendous amounts of work to be done, or estate sales. You just need to keep the dates in mind, and try to bring up the issue as early as possible so you can get the buyer to another property before the April 30th deadline.

ATTACHED is a sample form you could have the buyer sign showing you have advised them of the possible delayed closing.

Nick

1. How does a current home owner qualify for the $6,500 credit?
   Buyers must have lived in their homes for at least five out of the last eight years. The home they buy must become their primary residence, but buyers don’t have to sell their previous home. They can use the previous home as a rental or a second home and still claim the credit.
2. Does the new home have to be more expensive than the one the buyer currently owns?
   No. It is fine to use it to downsize. If the property sells for more than $800,000, the buyers don’t qualify.
3. Can buyers who are building a new home claim the credit?
   Yes, although the contract must be in place by April 30 and the buyer must move in by July 1.
4. Can buyers claim the credit if they purchase a home from a relative?
   No. The legislation prohibits taxpayers from claiming the credit if the sale is between “related parties,” including parent, grandparent, child, or grandchild

Source: USA Today