Tip 34-2010: Final Month for Tax Credit

On September 30, 2010, the tax credit for First Time Home buyers and replacement buyers finally expires.  Assuming the buyer qualifies for the tax credit (the contract had to be fully ratified by April 30, 2010), the closing needs to be completed no later than Thursday, September 30, 2010.

This means that all deeds need to be recorded before the appropriate Clerk’s Office closes on that Thursday.  Another problem is the necessary approvals by the short sale lender or REO Seller.  If the First Time Home buyers (or qualified replacement buyer) is purchasing a short sale or REO property, the final HUD needs to be approved by the short sale lender or the REO Seller.  This sometimes takes up to seventy-two hours (which will delay the closing).

Let’s all stay diligent to make sure that all eligible buyers receive their appropriate tax credit.

Please contact me (Charlottesville Attorney) if you have any questions.

William D. Tucker, III
Tucker Griffin Barnes P.C.
Charlottesville, Virginia
434-973-7474
Tucker@TGBlaw.com
www.TGBlaw.com

Tip 27-2010: Tax Credit Closing Deadline Extended

As most already know, the deadline for the completion of qualifying First-Time Homebuyer Credit purchases has been extended. Taxpayers who entered into a binding contract before the end of April now have until September 30, 2010 to close on the new or replacement home.

The Homebuyer Assistance and Improvement Act of 2010, enacted on July 2, 2010, extended the closing deadline from June 30 to Sept. 30, 2010 for eligible homebuyers who entered into a binding purchase contract on or before April 30, 2010 to close on the purchase of the home. Even though this extension should provide enough time to complete all eligible closings, we all have to stay diligent to make sure this new deadline is met.

Please contact me if you have any questions.
 
William D. Tucker, III
Tucker Griffin Barnes P.C.
Charlottesville, Virginia
434-973-7474
Tucker@TGBlaw.com
http://www.tgblaw.com/
http://www.tgblaw.blogspot.com/

Tip 23-2010: Tax Credit Deadline

Great news—large numbers of closings are taking place in June. Realtors and lenders have worked the tax credit hard, and a lot of people are able to benefit. I’ve even noticed most people are trying to avoid the final three days of June to close. This is especially important considering the consequences if the closings are not completed before July.

With unusually high volume comes scheduling issues. Normally all the parties (lenders, realtors and attorneys) try to close on the scheduled date because the buyers and sellers may have made plans relying on the date. There will always be certain closings that are naturally delayed. But even assuming such normal delays, I recommend everyone be prepared for delays, especially around the middle of June.

Accordingly, it may be a good idea to inform the parties (especially the buyer and seller expecting to close between June 14-18, 2010) that there could be a short delay, but the closing will still occur within plenty of time for the tax credit. If the closing must occur on a specific date (movers schedule, domino closings, etc.) then please let the settlement attorney and lender know. Communicating early with everyone about a potential short delay will hopefully avoid any problems later on. Let’s all (realtors, lenders and attorneys) work together to minimize any problems during these exciting times!

Please contact me if you have any questions.
 
William D. Tucker, III
Tucker Griffin Barnes P.C.
Charlottesville, Virginia
434-973-7474
Tucker@TGBlaw.com
http://www.tgblaw.com/
http://www.tgblaw.blogspot.com/

Tip 20-2010: Tax Credit Deadline (Con't)

As discussed last week, any purchaser who wants to receive the tax credit must close and have the deed recorded by June 30, 2010. (Some Clerk’s offices close as early as 4:00 PM) The following suggestions should help meet this deadline:

(a)  Have the settlement attorney order the title immediately (do not wait until after the inspections are resolved or the loan is approved)

(b)  Any new surveys should be ordered now

(c)  Schedule the closing for earlier than June 30th (Allow at least two days for any closing delays and to record the deed), I would even recommend closing the week before

(d)  If the Seller is a short sale, make sure that the short sale lender knows about the tax credit deadline (I’m not sure if it will make any difference, but at least try for a quicker approval)

(e)  If the Seller is an REO, make sure the REO Seller will be ready on time (ex. Trustee deed recorded, HUD approved)

There are probably other concerns to insure that the June 30th deadline is met. Above all, make sure that all involved continue to focus on the deadline, communicate with each other and resolve all issues as soon as possible. Do not wait until the last minute. As I understand it, the June 30th deadline is an absolute, “there are no do overs”.

Let’s all work together to avoid any problems and get our clients the tax credit they deserve!

Please contact me if you have any questions.
 
William D. Tucker, III
Tucker Griffin Barnes P.C.
Charlottesville, Virginia
434-973-7474
Tucker@TGBlaw.com
http://www.tgblaw.com/
http://www.tgblaw.blogspot.com/

Tip 19-2010: Tax Credit Deadline

(Tax Credit Deadline) Everyone is currently focused on the first deadline to qualify for the tax credit—there must be a fully executed contract by April 30, 2010 (Friday). It is the other deadline that also needs to be emphasized. The actual closing must be completed not later than June 30, 2010. This means that not only does the closing need to occur but the deed has to be recorded by this deadline (June 30 is a Wednesday).

Be sure that everyone involved in the closing knows the transaction needs to comply with the June 30 tax credit deadline. Initially the following suggestions should be considered:

(a) Apply for the loan ASAP
(b) Make sure the lender knows about the deadline and will expedite the loan
(c) Perform all inspections early
(d) Select the settlement attorney immediately ( don’t wait for loan commitment)

There are other suggestions which will be provided in next week’s Tucker’s Tip. Above all, be sure that all the parties in the transaction (lender, realtor, attorney, buyer and seller) continue to communicate with each other to insure that all issues can be addressed and resolved early.

Please contact me if you have any questions.

William D. Tucker, III
Tucker Griffin Barnes P.C.
Charlottesville, Virginia
434-973-7474
Tucker@TGBlaw.com
www.TGBlaw.com
www.TGBlaw.blogspot.com

Tip 15-2010: New Move Up Tax Credit

(New Move Up Tax Credit): The recent amendment to the First Time Homebuyer’s Tax Credit included a provision allowing existing homeowners to receive up to a $6,500 tax credit for purchasing a replacement home. This new provision requires that the homeowner must have owned and lived in his existing house for at least five consecutive years during the prior eight years, the new home price can not exceed $800,000, and the new residence must be under contract by April 30, 2010 with a closing by June 30, 2010.

There are some income limitations, but there does not appear to be any requirement that the homeowners have to sell their existing house nor do they have to buy a more expensive house.

This new provision should be considered for all current homeowners who may want to downsize and benefit from the excellent opportunities in our real estate market, along with the low interest rates available from our local lenders.

Hopefully with the warmer weather, more existing homeowners and first-time homebuyers will take advantage of this government program set to expire soon.

Please contact me if you have any questions.

William D. Tucker, III
Tucker Griffin Barnes P.C.
Charlottesville, Virginia
434-973-7474
Tucker@TGBlaw.com
http://www.tgblaw.com/
http://www.tgblaw.blogspot.com/

Tip 45-2009: New and Expanded Homebuyer Tax Credit

On Nov 6, 2009, the First Time Home Buyer Tax Credit was extended and even expanded. The First Time Home Buyer now has until April 30, 2010 to find that perfect house. Also as long as the contract has been ratified by April 30, 2010, you have until June 30, 2010 to close.

In addition, the Tax Credit (up to $6,500) is available for a current homeowner to move to a new primary residence. (The current homeowner is required to own his current primary residence for five consecutive years during the prior eight year period.) The current homeowner does not appear to have to sell his current house to qualify for this tax credit. Also, there does not appear to be any requirement that the current homeowner has to buy “up”, so he could downsize. Either way, these Tax Credit Extensions should make the winter and spring a little brighter!

Please contact me if you have any questions.

William D. Tucker, III
Tucker Griffin Barnes P.C.
Charlottesville, Virginia
434-973-7474
Tucker@TGBlaw.com
http://www.tgblaw.com/
http://www.tgblaw.blogspot.com/

Tip 43-2009: First TIme Buyer's Deadline

The “closing” must occur prior to Dec 1, 2009, in order for the First Time Buyer to receive the $8,000 tax credit. With Thanksgiving the week before (the courthouses, lenders and attorneys will be closed Wed [half day], Thur and Fri), the closing must occur either by Tues, Nov 24, or wait until the last possible day Mon, Nov 30. The actual law says the “purchase must occur before Dec 1, 2009”. The term “purchase” according to the Internal Revenue Code means “acquisition”. Several sources note that “acquisition” occurs when escrow closes and title to the property transfers to the Buyer, not when the paperwork is signed. This would mean that the Deed needs to be recorded by Nov 30. What a Confusing Mess!!

Good Strategy: Try to get everything completed prior to Thanksgiving, with anything left over (ex. recording the deed) to be completed on Mon, Nov 30. We all need to work together to try to assist the First Time Buyers with this confusing deadline.

Better Strategy: Write your Congressman for an extension of the First Time Buyer Credit!!

Please contact me if you have any questions.

William D. Tucker, III
Tucker Griffin Barnes P.C.
Charlottesville, Virginia
434-973-7474
Tucker@TGBlaw.com
http://www.tgblaw.com/
http://www.tgblaw.blogspot.com/

Tip 7-2009: New Home Buyer Tax Credit

Most of you are now aware of the government’s new Homeowner Affordability and Stability Initiative and the Tax Credit of $8,000.00 for “new home buyers.” For this Tax Credit a “new home buyer” is defined as not having owned a principle residence during the three-year period prior to purchase. Two good links explaining the Tax Credit for new home buyers are:

http://www.newquestcity.com/templates/contentpages/stimulus/firsttimehomebuyer.cfm
http://money.cnn.com/2009/02/13/real_estate/homebuyer_tax_credit_finalized/index.htm

Review this information and use this to your advantage. Please contact me if you have any questions regarding the Tax Credit.