Tax Credit closing deadline extended

The Senate has amended a bill to give homebuyers who were under contract on a home purchase by April 30 an additional three months to close the deal and claim the federal homebuyer tax credit.

Extending the deadline for closing from June 30 to Sept. 30 would allow lenders more time to clear a backlog of 180,000 homebuyers nationwide, said amendment sponsor Sen. Harry Reid, D-Nev.

The amendment to HR 4213, the "American Jobs and Closing Tax Loopholes Act of 2010" -- which primarily extends unemployment insurance benefits -- was approved in a 60-37 vote Wednesday. This does not extend the deadline for homebuyers to qualify for the tax credit, NAR said but only extends the deadline for closing transactions already in contract.

According to Yvonne Russell, a RE/MAX REALTOR, This amendment is a much needed answer to the huge bottle neck the June deadline created. Every mortgage broker, appraiser, title company and realtor I know in my local market is breathing a collective sigh of relief. The June deadline coupled with the changes in lending practices as well as the way appraisal are handled was unsustainable.