HUD changes the rules mid sale… Not fair!
May 13th, 2010
So you’re a 1st Time Homebuyer who has played by all the rules, made sure you were under contract before April 30th, and you’re scheduled to close before June 30th of this year. By following the rules, you’ll be receiving the $8000 1st Time Homebuyers’ Tax Credit. Everything should be perfect, right???? Not necessarily…
A client of mine in the Albuquerque area went under contract March 3rd to buy a Menaul Villas condo. This condo is currently being built and is on track to be completed in time to close before June 30th. So what’s the problem?
The Listing Broker for the Condo Development informed me yesterday about a potential glitch that has come up. Sometime after our contract was written (around the April 30th deadline for being under contract), the federal government changed the rules for condo phase approvals for FHA Mortgages. This approval process used to take 2-3 weeks through FHA, but now they have decided this approval process will be handled by HUD (the Housing and Urban Development Dept.). Now for the glitch…. The new process will take 4-6 weeks! How does this affect my client? By doubling the approval time, my Client will most likely not close by June 30th, losing the $8000 Tax Credit.
I’ve decided to write NM Sen. Tom Udall to explain our dilemma. I am asking him to look in to this situation to see what can be done. My client has played by the rules, but the rules were changed in the middle of the game! This doesn’t quite seem fair to me. Interestingly enough, this only affects Buyers of condos. If you were purchasing a Single Family Home, this change has no effect whatsoever.
Why would I go to these lengths to help my Client? As a Realtor who works specifically with Buyers in the Albuquerque/Rio Rancho area, I am an advocate for my Buyers. I am looking out for their best interests. Many times potential Buyers will walk into a new Home Builder’s Model and write an offer with the person behind the desk – who works for the Builder! So if you’re looking for a new home, take your Realtor with you. That way you’ll have someone there on your side!
I’ll keep you posted about my progress on this situation in my next blog!