The Deadline for the $8,000 tax credit is technically midnight of November 30th, 2009 but the deadline for when a buyer needs to start the loan application is much sooner than that.

With the new MDIA law, which enforces rules for the time that borrowers must have to review disclosures before closing, the # of days that it takes to process a loan from start to finish is potentially longer.

This means that it would behoove borrowers to start a purchase transaction much sooner than the middle of November. If they wait that long, it's likely that they won't get to claim the tax credit.

To be safe, I would recommend to someone that wants to claim the $8,000 tax credit to start a purchase transaction no later than October 30th. That gives the real estate agent and loan officer a good 30 days to close the transaction.

Here in Logan, Utah, if somebody wants to do a Rural Housing loan, they need to start the purchase transaction no later than October 15th, as Rural Housing is taking up to 2 weeks to review the loan package. This is on top of the 30 days that it could take to process the loan.

My hope is that the government will extend the tax credit through all of 2010. But if I were a first time home buyer I would not wait to see if that happens. With interest rates as low as they are, I can't think of another time that has been better to purchase a home.