Who Stimulates Homebuyers More?

The House or the Senate? That’s the question you can vote on in this post on the WSJ’s Developments Blog.

The House version would modify an existing $7,500 credit so that it wouldn’t have to be repaid, while the Senate goes much further by doubling the credit, removing income limits, and extending it to existing homeowners, from just first-time buyers.

The Senate version would also benefit more upper-middle income buyers. The current credit is refundable, which means that even those who pay little to no income tax could receive a government check, while the Senate credit is nonrefundable, so that buyers only stand to gain if they pay federal income taxes.

From my standpoint as a title company owner, I favor the Senate bill, since the larger the credit, the more people it affects. The problem still remains though, that you have to get a loan, and these days you need some money down. With US savings rates being what they are, while this might encourage people to take advantage of some good deals and buy a new house, it doesn’t create money for a down payment.

The full text of the bills can be found here.

More answers to your Senate bill questions here. Some Q&As from the link:

When will the new tax credit go into effect? The Senate version would take effect when the bill is signed by the president into law, and it would last for one year.

Can I take the tax credit this year? Yes. The Senate proposal would allow buyers — even those who purchase in 2009 — to claim the credit on their 2008 taxes.