The following is now outdated, but we’re keeping it “up” for the moment because military families who have been overseas for 2 years or longer have another year in which to claim the rebate. If they close by the end of June in 2011, they can still claim it. Call our office for details if you believe you qualify.
This therefore is old stuff:
The purchase deadline for first time buyers to reap the $8,000 tax credit is just around the corner, considering it’s harder nowadays to get around the corner!
While this site is intended primarily for existing home buyers that have been clients of ours in the past, and so are homeowners already, almost everyone knows of potential first-time buyers among family and friends, and those are the ones for which this message is intended.For them, the ticking sound is the sound of time creeping up on the expiration of the $8,000 tax credit for first time home buyers.Of course, it is only July and the credit does not expire until Dec. 1. But unless the federal government decides to extend or expand the credit – kind of a long shot — it may be time for potential first time buyers to get the process started.
First, remember the rule: it is not that a contract must be signed before Dec. 1 or a loan approved by then. The sale has to close before Dec. 1.But even this scenario is tempting fate, but we believe buyers should have a purchase contract signed by mid to late September, so they have 45 to 60 days to safely close the purchase. Buyers who want to be in a new home by Thanksgiving need a contract by mid September for sure.
Under normal circumstances, buying a home is a complicated process, particularly after the fun of looking at potential homes descends into financial minutia. The process is normally difficult, especially for first time buyers, who have not been through the process before.
But that process has become much more laborious in these times. We have seen all kinds of surprises in the appraisal and lending processes. One simply cannot count on the old timetable. New appraisal rules have kicked in and we are seeing St. Louis and other out-of-area appraisers groping for local data and statistics, and taking lots of time. Lenders are taking lots more time and are being super careful about everything. Also, it can take significantly longer to get an answer back on an offer for a distressed property than a traditional one. It seems that everything is dragging out and taking longer.
And we want to be very careful ourselves in supporting the search process, making sure that all viable options are considered, and a comfortable confidence is built. We still want the usual careful analysis of resale potential for all finalists.
The bottom line is that it is not too early to organize the search and get the financing efforts started. These two functions need to be considered as on parallel tracks, merged at the moment necessary after the search identifies the single best option.
In fact, some kind of commitment from a lender needs to be in hand before offers are made. That is a most important tool for us in making the offer look good to the seller. (Sellers are more careful nowadays, too, as they want a deal that really closes, and closes on time.) So financing surety up front goes a long way, in building buyer confidence, in making it easier for the sellers to say yes and for the whole process to go smoothly.
Then finally, there is little doubt that the $8,000 incentive is working as intended. All of us in the business have seen a growing interest in taking advantage of that, so many in fact, that last minute congestion at the closing offices (title companies) could even be a possibility.
So we surely do not mean to be discouraging. We just want to say that under these modern circumstances, it could take longer than usual to close on a transaction, so it is not too early to get it started. And while it may be formidable, we are there to make it safe and comfortable. Like a lot of our most challenging lifetime efforts, the reward will surely be worth it! We hope you might convey this sentiment to family and friends that are in a position to take advantage of the incentive AND get into a new home by Christmas, or even, Thanksgiving.
This entry was posted
on Saturday, July 18th, 2009 at 4:03 pm and is filed under Buying Advice.
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