California May Max Out on Home Buyer Tax Credit Early

A California tax credit that grants buyers of new homes in the state a $10,000 tax credit has proved to be so popular it may soon max out — nine months before its expiration date. According to California's Franchise Tax Board, "we will soon reach $100 million in new home credit applications" which is the maximum set by law. The state notes in a release that once the threshold is met "the tax credit will no longer be available." A spokeswoman for the governor's office told National Mortgage News that the state is aware of the problem. "It's been very successful," she said. "There may be a bill to extend it or increase the amount of money allocated." The tax credit expires March 2010. It applies to all homebuyers in the state but only if they purchase a newly built home that has not been occupied.