UPDATE- Today, November 5th the House voted for the Act with no changes to the Senate Amendments. Once the President signs it, this is what we will have as law.
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This afternoon at 5:28pm the Senate overwhelmingly approved the Unemployment Compensation Act of 2009 (H.R. 3548 as amended)which includes provisions extending AND expanding the Homebuyer Tax Credit. Now do understand the bill must be reconciled with the House of Representatives and then signed into law by the President, so there are provisions that can change. What it says right now is basically
•· First Time Buyers have what they had before, expiring May 1, 2010. If a buyer is in a binding contract before May 1, then they shall have until June 30, 2010 to close the deal.
•· Buyers will still be able to treat the purchase as if it occurred on December 31st of the prior year. This means buyers that close in December should still be able to amend their 2008 taxes and get their funds sooner!
•· An exception has been created to allow individuals or married couples that have "owned and used the same residence as such individual's principal residence for any 5-consecutive-year period during the 8-year period ending on the date of the purchase of a subsequent principal residence" be categorized as First Time Buyers under this act. The big question I've been asked is do they have to sell old home or can they keep and rent it and thus far the act is silent on that.
•· Long Term Residents as they are called, are limited to $6,500 or $3,250 depending on how they qualify.
•· Income guidelines have been increased to $150,000 for individuals and $225,000 for couples and the purchase price is limited to no more than $800,000.
•· Members of the uniformed services, Foreign Services of the US, or the intelligence community who are forced to no longer occupy their homes as primary residences due to Government orders are exempted from the recapture and don't have to pay the funds back.
•· Persons on extended duty outside the US for at least 90 days may have an extra year to qualify for the program.
•· You must be at least 18 years old to claim the credit and will have to attach a copy of your settlement statement as proof the deal has closed.
There is a lot more fine print to digest but again I can't overemphasize WE MAY STILL SEE SOME CHANGES, so don't quote this as law! Do feel free to share the info as an up to date picture of what is being considered and chances are pretty good we will see it pass essentially as is.
One thing that's for sure is with as long as some short sales are taking to approve, even with the extension there will be no time to waste. Hopefully consumers have realized this and we can avoid some of the last minute rush we are seeing now!
Gerry Suarez, Jr.
Your FHA Loan Pro!
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Gerry, As you say one question for upgrading buyers is
"do they have to sell old home or can they keep and rent it"
I SUSPECT they would have to sell the old home. Now the bill is back to the House and then to the President before it becomes official. I will be watching to see if anyone knows about the upgrading buyer.