The National Association of Realtors hasn’t given up hope that lawmakers will resurrect the National Flood Insurance Program and extend the deadline for closing on a home purchase to qualify for the homebuyer tax credit past June 30, although a bill that would have accomplished both those goals has become mired down in a Senate debate over deficit spending.
The battle over HR 4213, the "American Jobs and Closing Tax Loopholes Act of 2010," has raged for eight weeks, with Senate Democrats failing Thursday to get the 60 votes needed to end debate and hold a vote.
Republicans object to the bill, which would extend emergency benefits for millions of unemployed workers and tax breaks for businesses that are scheduled to expire, because of its potential impact to the national budget deficit.
Although Democrats have pared the bill’s spending provisions, the latest version of the bill would increase the deficit by $33.3 billion over the next 10 years, according to an analysis by the Congressional Budget Office.
Now Democratic leaders say they don’t expect action on the bill until Congress comes back from its July 4 recess, the Washington Post reported today.
The Senate amended the bill last week, introducing language that would give homebuyers who were under contract by April 30 until Sept. 30 to close on their home purchase and qualify for the homebuyer tax credit (see story). The current deadline for closing is June 30.
Realtors were also looking forward to seeing another provision of HR 4213, retroactively extending the National Flood Insurance Program, signed into law. The expiration of the indebted program on May 31 has left many would-be homeowners unable to obtain insurance and derailed many home closings.
There’s already another bill in play to extend the National Flood Insurance Program, HR 5569, which has been approved by the House in a June 23 voice vote. NAR is urging the Senate to take quick action on that bill (see story).
NAR is still holding out hope that lawmakers will take action to extend the closing deadline to claim the homebuyer tax credit before it expires on June 30, either through a standalone bill or by amending other legislation that’s less contentious than HR 4213.
If the impasse over HR 4213 isn’t resolved until after June 30, the bill could still extend the closing deadline retroactively.
But "retroactive, in this case, won’t solve all the problems," said NAR spokesman Lucien Salvant. "Contracts have contingencies, rate locks expire — there are a lot of things that could still prevent a lot of these people (under contract) from closing."
NAR estimates that as many as 180,000 homebuyers who are under contract and could qualify for the homebuyer tax credit may not be able to meet the June 30 closing deadline.
Salvant said NAR is advising Realtors to "hang in there for the time being — we still have up until the 30th to get something done."
The passage of standalone legislation or an amendment to another bill to extend the closing deadline is "possible, but I don’t want to give anyone any false hopes," Salvant said. "We’re continuing to explore as many avenues as we can to get it done. Even if this big bill doesn’t pass, there are other ways of getting it done."
Salvant noted that the Senate’s 60-37 vote on June 16 to amend HR 4213 to extend the closing deadline demonstrates that there’s support for the concept among lawmakers.