Washington, D.C.—Today, Congressman Joe Donnelly introduced The First-Time Homebuyer Tax Credit Guarantee Act to ensure that those Americans seeking to become first-time homebuyers by November 30 can claim their tax credit.  Congressman Gary Miller (R-CA) joined Donnelly in introducing this legislation.

“This is common-sense, bipartisan legislation that will eliminate uncertainty among first-time homebuyers seeking the tax credit, as well as help the nation’s housing market get back on its feet,” Donnelly said. “I hope Congress extends the deadline for the first-time homebuyer tax credit, but unless and until that happens, my bill will continue to encourage first-time homebuyers to enter into the market.”

As it is currently written, the $8,000 first-time homebuyer tax credit is available only to those who close on their purchases on or before November 30. This could prevent thousands of homebuyers who enter into contracts ahead of the deadline from receiving the credit because they may not be able to close before that same deadline.

In addition to many first-time homebuyers not realizing how long it takes to close on a home, the current economic climate has caused the closing process to take even longer than before. Lenders are more closely scrutinizing potential homebuyers before approving them for mortgages and, as a result, realtors are suggesting that homebuyers expect the process to take about 60 days or longer instead of the traditional 30 to 45 days.

Donnelly’s legislation specifies that as long as a first-time homebuyer enters into a contract on or before November 30 and closes on the purchase within 90 days of the tax credit’s expiration date, he can claim the credit. It would also allow those who sign a contract ahead of the expiration date but close after the New Year to treat the purchase as having occurred on December 31, 2009, allowing the credit to be claimed retroactively for the 2009 tax year.

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