Sunday, June 13, 2010

Bill Would Extend Closing Time For Homebuyer Tax Credit Contracts...and Fraud

Senate Majority Leader Harry Reid (D-Nev) has attached a bit of legislation to a bill that would allow those who signed the Homebuyer Tax Cred by April 30 to close by September 30, rather than the original June 30.

Sales of single family homes in C'ville and Albemarle bounced up before the deadline, and then dropped significantly, following a national trend.   With contingencies, inspections, appraisals, credit approval just before loan dispersal, there are all sorts of ways a contract can fall apart. 

But one way shouldn't be due to sheer volume.  The idea for extension is to deal with volume.  Too, many tax credit sales will be for short sales and foreclosures, which have so much paperwork, they will take longer than "traditional" sales to close. Read. 

However, this also opens the way for certain parties to commit fraud.  Tax fraud is a federal offense.  Who'd do this for $6,500 - $8,000k?  ....Oh, yeah, people who don't have any $ to put down on a house.  But that's an awfully big risk that could equal time in the Big House.  Read 

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