As you may know the home buyer tax credit has two deadlines;
1) you have to be in contract by April 30th and 2) you have to be closed by June 30th, 2010.
These are hard deadlines. The government is not likely to issue another extension of the tax credit and the IRS has been extremely strict about enforcing deadlines.
If you want to take advantage of the home buyer tax credit the time to start is right now. April 30th seems a long time away but it's only 112 days from June 8th. Some of you have probably been looking for months already so you know that it can take time to find your perfect home.
Remember that getting into contract on a home can take a lot of time. You need to get all these things done: 1) find the right real estate agent, 2) find the right mortgage officer, 3) get pre-qualified for a loan amount, 4) look at lots of homes online, 5)look at lots of homes in person, 6) find the right home and make an offer, 7) negotiate the price and terms, 8) arrange and hold an inspection, 9) deal with the inspection results, 10) hire an attorney to review contracts, 11) review contracts with attorney, sign and return. Even if you're in contract by April 30th, your not home free because you still have to be closed by June 30th which gives you only 60 more days to get through the title and financing process.
Moreover, as we get closer to these deadline were going to see business activity explode. If you wait too long you might have trouble scheduling an inspection when the inspectors are being hammered with urgent calls from people in the same position. A lot of people are going to be scrambling to get into contract in the last two weeks of April and closed in the last two weeks of June. Try not to be part of that mob.
Seven Tips
1) get your team together today: realtor, lender, attorney, home inspector, etc
2) make sure everyone knows what you are doing - don't hide your intentions, tell everyone you are trying to close before June 30th
3) start gathering your documents immediately - ask your lender what you will need to produce in order to apply for the mortgage
4) be proactive with your lender - the most likely delay in a real estate transaction is the financing, not because your loan officer did something wrong but because bank financing is a complicated process
5) stay on top of everyone - communicate with everyone, stay in touch, don't let anything fall through the cracks.
6) be prepared for last minute delays - no matter how prepared you are you are going to end up with last minute delays. Don't leave things to the last minute.
7) choose your seller wisely - once you have an accepted offer the seller and buyer are supposed to work together to close the deal. If you sense the seller is not responsive he may delay you in reaching you deadlines.
The key to all of this of course is a great real estate agent who can help you manage your purchase.
Source: BHG Rand Realty Blog 1.8.10
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