The Home Buyer Tax Credit Has Risen From the Grave!


September is the new June, as the deadline to close on houses purchased with the First Time Home Buyer Tax Credit comes…and goes.

If you can produce paperwork indicating that you signed papers on a home purchase before April 30, you now have until September 30 to close. The original deadline for the tax credit was settlement by today. But claiming that settlement offices are "slammed" by all the business the tax credit has generated, the House of Representatives voted overwhelmingly yesterday to give buyers another three months to settle.

The Senate is trying to pass its own version of the extension now. Reuters notes that the extension is an invitation to fraudsters who will backdate purchase papers to before the April 30 deadline.

As always though, the real fraud is hidden in plain sight. May figures [pdf] show how the real estate market tanked as soon as the tax credit was withdrawn. The tax credit is the last injectable vein in the shriveled body of the American real estate market. Without it, there's nothing standing between dumb buyers and the horror of price discovery.

This extension applies only to papers signed prior to April 30, but you don't get a 409-5 vote in the House just for creating leeway in paperwork filing. Like Uncle Frank in Hellraiser, the First Time Home Buyer Tax Credit is now back in only blood-and-nerve form, but it will keep murdering taxpayers and be back in full body before real estate values fall to a market-clearing level.