The federal government is offering first-time home-buyers a tax credit of 10% of a home’s sales price up to $8,000. To qualify, you must close on a home by November 30th; if you close on December 1st, you’re out of luck.
If you’re a first-time buyer in the Chicago area, you have a little over three weeks left to find a home, make an offer and negotiate terms if you hope to close in time to get the $8,000 tax credit.
Close By November 13th
In a normal month, about 20% of closings slip from the last week of a month to the next. This number will almost certainly be higher in November due to the expected rush of buyers trying to get the tax credit and because November 30th falls on the Monday after Thanksgiving.
If you’re hoping to get the tax credit, you want to make sure you’ve closed before the week of Thanksgiving because it’s not a full work week:
- Thursday, November 26th: Turkey day. A day to give thanks and watch the Detroit Lions go for six Thanksgiving Day losses in a row.
- Friday , November 27th: Cook & DuPage county offices are closed.
- Saturday & Sunday, November 28th & 29th: The banks aren’t open so you can’t close.
- Monday, November 30th: The last day to close and qualify for the first-time buyer tax credit. It’s going to be a goat rodeo.
To give yourself the best chance of getting the tax credit, plan on closing by November 13th. If you run into any problems during closing, you’ll have more than a week to work things out and still qualify for the tax credit.
Get An Offer Accepted By October 3rd
Right now, it’s taking our Chicago-area clients an average of 41 days to close once they reach initial agreement on terms. This means if you want to close by November 13th, you need to get an offer accepted by October 3rd. That’s 25 days away.
For more information, check out the Home Buyer Tax Credit FAQ from the IRS and get all the details about the tax credit from the agency giving the credit. Also, check out the report that this program may be extended.
Find A Home You Like
Don’t rush into a purchase. Make sure you’re buying because you’ve found a home you want to live in, not because you want the $8,000. You don’t want to end up in the wrong house in the wrong neighborhood with the wrong commute just for a few thousand dollars.