While many people are aware that the deadline for the Federal House Tax Credit is April 30 but it (May 1st) is also the deadline in for claiming a homestead exemption. Why is this important? If the property you are buying is bank owned and it is currently showing 100% homestead exemption, on May 1st it will convert to non-homestead and when you close on the home (assuming it is after May 1st) you will be stuck with the non-homestead tax rate until the following May.
It is very important as the non-homestead rate can be significantly higher and the lender may have to increase your escrow for taxes that first year to cover the added expense. Worst yet the difference may raise your payment over the ratio in order to qualify for the loan to begin with.
On the other hand if you are going to buy a home that is currently homesteaded and it will not be your primary residence then it would be to your advantage to wait until after May 1st to close as it will result in a lower tax for the first year. Please consult with your lender and REALTOR to determine how the tax rate will affect you.
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