Home buyers worried that they might miss out on a government tax credit because of transaction delays can relax now that Congress has extended the deadline for closing by three months.

On June 30, the U.S. Senate passed legislation, which had earlier been OK’d by the House, allowing home buyers to qualify for a tax credit worth up to $8,000 if their transaction is finalized by Sept. 30, rather than an original June 30 deadline. The extension, however, only applies to buyers who met an earlier April 30 deadline to be under contract to purchase a home.

As home buyers rushed to complete their purchases by the original deadline, it became apparent that mortgage processors and others involved in the closing process were overwhelmed by the huge volume of work. Industry leaders said the extension of the tax credit was important simply so buyers had time to make it through the backlog that was part of the mortgage approval process. 

In Utah, about 1,130 buyers were at risk of losing their tax credit had Congress not granted the extension, according to estimates from the National Association of REALTORS®. Nationally, about 180,000 buyers needed extra closing time.

Eligible buyers are expected to see a seamless extension of the closing deadline from June 30 to Sept. 30.

Source- Utah Association of Realtors