The Erie County Clerk's Office is getting flooded with home closings as the federal tax credit deadline approaches next week, but Clerk Kathy Hochul said Friday that her office is adequately staffed and prepared to handle the crush.
Qualifying homebuyers who signed purchase contracts by April 30 have until Wednesday to close the deals and file the papers with the clerk's office in order to qualify for the credits. First-time homebuyers can get up to $8,000, while "move-up" buyers are eligible for up to $6,500.
The credits have driven a surge in homebuying activity in recent months, spurring exactly the kind of boost to the economy that was intended. Pending home sales, where buyers signed purchase contracts but still need to close on the deal, surged by 35 percent in April, according to the Buffalo Niagara Association of Realtors.
But it's also given Hochul and her team a run for their money, especially as the clock ticks down.
"I can't catch my breath," she said, in between taking time to hand out information to homebuyers about how to actually obtain the credit. "It's controlled chaos. There's a lot of people closing today."
Hochul said it's been "standing-room-only" in the cavernous closing room at the clerk's office, where several rows of small tables were completely filled with buyers and attorneys inking their deals.
"It's good activity," she said. "A lot of people [are] excited about buying their first home and taking advantage of the tax credit."
But she's not worried about being overwhelmed, even with fewer staff in her office than before the state's budget crisis. Her 12-person "cashiering" staff, who accept and process the paperwork from attorneys, are staying as long as needed to get the work done over the next few business days. Lunch and break periods will be adjusted, and Hochul said she didn't approve any vacations for next week, unless they were already scheduled long ago.
"We'll handle it. We anticipated it. Our staff is planning on working as long as necessary," she said. "Our staff's very good. They're professionals. They want to do what's right for the customer. They don't want anyone to be inconvenienced."
Some of that is out of her office's control, however. Attorneys and others are concerned that some clients may not get their financing completed on time, even if they signed their contracts by April 30 and did everything else right. That's because the lenders are so overwhelmed that it's taking them longer to process applications and approve loans.
"The backlog with the lenders is so extreme that there will be people left behind," Hochul said.
That particularly can be an issue with "short sales," in which a lender agrees to take a lesser amount on the sale of a home by the borrower in order to avoid a foreclosure. In a short sale, the lender has 120 days to approve the buyer, so "people who thought they were getting a good deal may not have that in place in order to get the tax credit," Hochul said.
Hochul and others in the mortgage process have been pushing for Congress to extend the time for qualifying homebuyers to close the deals so they don't miss out on the credits. Legislation has passed the U.S. Senate, but not the House of Representatives.
"We're simply looking for a little reprieve for the lenders who simply can't get the financing approved in time," she said. "We see no relief for our lines at this time, but we can certainly handle the business before us."