With the $8,000 federal tax credit for first-time home buyers set to expire Dec. 1, local banking officials are hoping for a steady stream of mortgage business before the tax break ends.

Stephen Ranzini, president of University Bank, credited the tax credit with helping to clear $1 million in foreclosed properties off the bank's balance sheet over the past few months. He said the vast majority, if not all, of the buyers used the tax credit.

"We've seen a lot of people taking advantage of that," he said.

The credit has likely pushed people into a market they may not have entered otherwise, Ranzini said.

"My sense is it pushes a lot of people over the edge," he said.

"It certainly has driven more business than normal," added Bob Chapman, president of United Bancorp, parent company of United Bank & Trust. "It helped begin to put a bottom on where housing prices are."

According to data gathered by the Ann Arbor Area Board of Realtors, 1,688 homes were sold in the area through the end of July, down 106 from the same period one year ago. But many in the real estate industry believe this year's numbers would be significantly lower if not for the tax credit.

"It's taken a lot of buyers and shoved them through the system," Chapman said, because they want to act quickly to take advantage of the credit before it ends.

For that reason, he predicted a slowdown in new home purchases after the credit expires. But until then, "we think there will continue to be a number of people who do something before it runs out."

This spring, rules on the credit changed to allow it to be accessed at the closing table, a move that further spurred its use, Ranzini said.

But he didn't predict a huge surge in use of the tax credit between now and its expiration at the end of November.

"A lot of people, when they move they want to move before school starts," he said. "Most people want to move in the summer."

Freelance reporter Dan Meisler can be reached at danmeisler@gmail.com.