Tax Incentive Extension Might Help Lower Foreclosures by State Number- By: John Cutts
High rates of foreclosures by state continue to be a major problem for most areas of the U.S. However, the decision of the federal government to extend the tax credit program until September 30, 2010 might help arrest the foreclosure problem in some major housing areas and hopefully contribute to the recovery of the country's residential real estate market.
Homebuyers who purchased distressed real estate properties to take advantage of the tax program earlier this year will not have to worry that they will fail to close the transaction at the appropriate time; at least, until the end of September.
The U.S. Congress submitted a plan to President Barack Obama that will provide home buyers three more months to qualify for the tax incentive that the government is offering in an effort to improve housing sales and combat the problem of home foreclosures. The plan was approved by the House on June 29, while the Senate provided its approval a day after Congress did. The President is expected to put his signature in the measure within the next few days.
With the extended deadline offering better chances for home buyers to close their purchase transactions, it is hoped that foreclosures by state will somehow abate and a modicum of stability will be achieved in some key housing markets. Buyers who are purchasing a home for the first time can earn as much as $8,000 worth of credit, while existing home owners can get incentives up to $6,500.
The Treasury Department has reported that almost three million American households took advantage of the incentives and purchased new homes or distressed properties from foreclosure home auctions and other channels, resulting in a $21 billion price tag for the federal government.
Housing market observers have reported that most of those who took advantage of the incentives are relieved that the deadline had been extended. A big number of them, experts have added, would have stopped completing the transactions which would result in deeper foreclosures by state problems.
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John Cutts has been educated in the finer points of the foreclosure market over 5 years.