Some great news was just received as Congress has extended the $8,000 tax credit for first time homebuyers. The President is expected to sign the bill today. Not only have they extended the bill until the last day of April, 2010 but have expanded the possibilities to people who have owned their home for a minimum of five years.
First the extension of the $8,000 tax credit. Through August of this year approximately 1.4 million people nationwide have taken advantage of this program accounting for about 40% of all home purchases. The new stipulations are that the property must be under contract by April 30th, 2010 and close by June 30th, 2010. This is in line with most current lending practices of 45 days to process a mortgage loan. The credit will also be extended for one year for members in the military who have or will serve overseas for a minimum of 90 days.
Now to the Expansion of the tax credit to people that already own a residence. This credit will be for $6,500 and will include anyone who has owned their primary residence for at least five years. This tax credit is not eligible for individuals earning over $125,000 per year or joint filers earning more than $225,000. It will be eligible for homes priced under $800,000. Unfortunately it is only for primary residence and not for second or vacation homes.
