Time Running Out for First-Time Home Buyers to Get Tax Credit

By: Jennifer Dowling Email
By: Jennifer Dowling Email

It's a program that can potentially give first-time home buyers an $8,000 tax credit for a new home. But, time is running out to take advantage of it.

For Kristin Ritchie, her new home is a dream come true. She says, "I'm closing in 2 weeks. and the process has been about five months." She's taking advantage of the first-time home buyer tax credit. She says, "It's influenced my decision on becoming a new homeowner. If it wasn't for that, I would have never been in the market."
Senior Loan Officer Ron Harke says, "The problem is right now, you're going to see a real flood of activity because everybody wants to get on board before it does run out."

Harke says if you are going to buy, don't wait. He says the days add up because you will need time to get an appraisal and a home inspection. He says, "Usually it takes 2-3 days to set something up, or schedule it. Generally, your offer is written...you've got so many days to get that inspection done. To say I'm going to bid this amount for this house is subject to a satisfactory inspection because you want somebody else to look at it."

Extra time will also be crucial if other obstacles pop up before deadline. He says, "This is a process that takes time. Generally you not only have to find a house and negotiate a day, and so many of these transactions are repossessed houses or something where you're not dealing with a real seller. So, it can be real time consuming getting an answer back on your offer."

Also, be advised, you need to have your keys in hand by December 1st. Harke says, "You have to have the physical closing where the money and the keys change hands, yes." "The problem is the clock is ticking...you have to have the transaction closed to qualify by the end of November."

Harke says the paperwork should be in by October 15th. Harke says, "If you don't have something in writing, some kind of purchase agreement by I'm thinking mid-October at the latest, you're probably not going to make it to the closing table in time."

Ritchie says, "Be patient and find the house you want, but you really need to hurry up." She says if you can get it done, the incentive is worth the effort. Harke says, "If it were me and I was going to buy something, I would get involved before this one runs out."

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