Home Buyer Tax Credit Extension

Congress passed two measures for the housing market on November 5, 2009!

The first time home buyer tax credit deadline was extended to loans purchased on or before May 1, 2010, and closing by July 1, 2010. For first time home buyers the credit will remain at $8000, and all other home buyers could be eligible for up to $6500. The income limits to qualify for the credits was increased as well, to allow more buyers to qualify, and hopefully boost the move up and move down buyers. This will also hopefully move some inventory in the higher priced homes that have been very hard to sell all this year.
For current home owners looking to cash in on this credit, they must have owned their current home at least 5 years. The tax credit is available for the purchase of principal homes costing $800,000 or less. Purchase of second homes or vacation homes are ineligible. The credit will be phased out for individuals with annual incomes above $125,000 and for joint filers with incomes above $225,000.
Congress also voted to extend the higher conforming loan limits for Fannie, Freddie and FHA loans. These limits are set at 125% of the average home price in your area, up to a high limit o$795,000. You have to check your county limits to determine the actual high price limit for your area. This will have the greatest impact on states like California, Washington, and the Northeast where average home prices are substantially higher than most of the country. But, this is good news for home buyers in those areas who would otherwise have to finance home purchases with "jumbo" loans which typically have much higher rates.