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June 8, 2010

CAN CLOSINGS BEAT THE TAX INCENTIVE DEADLINE?
The Federal Home Purchaser Tax Incentive added nearly one million more home purchasers to the real estate market. This is aiding the trade-up market and has considerably enhanced the inventory circumstances. This has allowed the price of homes to stabilize sooner and has saved approximately nine hundred billion dollars of home equity, which has let additional households avoid being "under water", thus avoiding foreclosure.

A major concern that has now appeared is one of not enough time in which to close escrow. Normally, the time from contract to close of escrow would be 2 months or less. The present housing market, due to the large number of short sales awaiting bank approval, as well as continuing issues with appraisals, is creating considerable delays in getting to the closing day.

There may be a large number of buyers who took advantage of the tax incentives who might well experience difficulties making the settlement deadline which is June 30th.

Due to these market difficulties, the National Association of Realtors has requested that Congress grant some flexibility on the upcoming closing deadline.