As of June 10th lawmakers were trying to revive the $15,000 housing credit. Here’s a snip from a bloomberg.com[1] article:
“Senator Johnny Isakson, a Georgia Republican, introduced a bill today that would increase the tax credit to $15,000 and remove income and other restrictions on who can qualify, according to his spokeswoman, Sheridan Watson. The Treasury Department declined to comment on the proposal.”
With the major increase in mortgage rates and the flood of foreclosures coming our way, I think the $15,000 credit revival is a necessity and not a nicety. March, April and May were the top 3 months ever in foreclosure activity and with summer already on its way those “pre-foreclosures” look like they’ll start coming out in seasonably slower times for selling.
Add on-top of the increase of foreclosures the near 1% gain in interest rates we have a perfect storm brewing to curb the entire housing recovery plan and sideline many first time home buyers.
Here’s some highlights to the 15k plan that is being pushed:
* Removal of Income Limit
* Increase time to qualify (1 Year from the day signed, it would not be retroactive). (Don’t ask what day it’ll be signed, because no one knows, and the treasury declined to comment)
* Would lower your tax liability, and would not be refundable if it was over your tax liability, and would be spreadable across 2 years.
* Remove first time home buyers restrictions (although this would be interesting, because would people who buy back their own short sales though internal bank processes be eligible for this? if so, that’d be bad).
It’d pretty much be allot like the previously senate approved $15,000 credit that I wrote about here
What would this bill do to the housing market? It would spur more interest in buying and have more people on the side-lines get up (myself included). It would better target the Jumbo loan market since the people that are in that market can take advantage of the full 15,000 drop in liabilities where as people in the lower range wouldn’t take advantage of the full 15,000, even over a 2 year period. (again re-read my original home buyer tax credit for description of how it works).
I can tell you one thing, the day I posted the $15,000 credit the number of hits on that compared to the $8,000 credit was 20 to 1, and even now with that bill long shut down i get FAR more hits on 15000 tax credit from Google then 8000 tax credit (just a thing to ponder, it really seems like that could be the amount people are looking for).
Lets hope.. that this gets approved since well we know the administration won’t let free market determine correct supply and demand pricing.
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