Housing and Urban Development Secretary Shaun Donovan said on Sunday that the Obama administration is weighing in on whether it should bring back the popular tax credit for first-time homebuyers.
Donovan feels that it's too early to say whether the tax credit will be revived, but said that the administration is focused to do everything they can to help stabilize the uncertain housing market.
The recently expired federal homebuyer's tax credit of $8,000 did boost home sales and further helped to revive a sinking housing market and economy.
Sales of existing homes fell to their slowest pace in 15 years this past July and have returned fears that the nation could be on the edge of another sharp drop in home sales.
Acknowledging that the data was worse than the Obama administration had expected, Donovan said the government was taking measures to ensure more growth and may include starting a refinancing program for some borrowers as well as an emergency loan program for the unemployed.
While supporters of a new tax credit see it as a key to stabilizing the economy despite continued low mortgage interest rates, those opposed to bringing it back say it would blow a bigger hole in the federal deficit.
Florida Governor Charlie Crist said, "I think it would help enormously, and I would absolutely encourage the president to support that."
In July, Obama signed in a new law giving homebuyers already in the process of buying a home an additional three months to close the deal in order to still receive the tax credit.
Homebuyers who were able to get contracts to buy homes signed by April 30 and who failed to close by the original June 30th deadline now have until September 30th to close escrow and still get the tax credit.