First-Time Homebuyer Credit Closing Deadline Extended to September 30, 2010

1. If you entered into a binding contract on or before April 30, 2010  to buy a principal residence located in the United States you must close on the home on or before September 30, 2010.
2. To be considered a first-time homebuyer, you and your spouse – if you are married – must not have jointly or separately owned another principal residence during the three years prior to the date of purchase.
3. To be considered a long-time resident homebuyer, your settlement date must be after November 6, 2009 and you and your spouse – if you are married – must have lived in the same principal residence for any consecutive five-year period during the eight-year period that ended on the date the new home is purchased.
4. The maximum credit for a first-time homebuyer is $8,000. The maximum credit for a long-time resident homebuyer is $6,500.
5. To claim the credit you must file a paper return and attach Form 5405, First Time Homebuyer Credit, along with all required documentation, including a copy of the binding contract. New homebuyers must attach a copy of the properly executed settlement statement used to complete the purchase. Long-time residents are encouraged to attach documentation covering the five-consecutive-year period such as Form 1098, Mortgage Interest Statements, property tax records or homeowner’s insurance records.

I figured something like this would happen. I wonder how much their attorneys are going to cost vs. what the homeowner owes them?!

"Taking aim at homeowners who are able to pay their mortgage but decide it's not worth it, Fannie Mae plans to go after them in court and to limit their access to home loans for seven years.

The government-controlled mortgage giant said Wednesday that it would instruct the companies servicing its loans to recommend when it should pursue a so-called deficiency judgment — a court order requiring a defaulting borrower to pay any remaining unpaid portion of the loan after a seized home is sold."

Read the rest of the story

Make sure that you do NOT take out any new credit from the loan pre-approval process until after the loan closes. Many lenders are repulling credit before the closing and are finding that buyers have opened up new credit accounts, which can change their debt-to-income ratio and/or affecting their credit score. This can obviously have a negative effect on the closing.

Read the flyer

Thanks to Michael Delvecchio for the info.

Michael DelVecchio
BancGroup
mdelvecchio@bancgroup.com
Cell: 303-947-5147
Office: 303-542-1100

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