| The White House has approved a law that will provide | | | | - Up to $7,500 refundable tax credit for first-time |
| homeowners relief from the housing crisis. The | | | | homebuyers |
| Economic and Housing Recovery Act of 2008 will help | | | | - Increases the FHA loan limit to $625,000 |
| troubled homeowners keep their homes and allow | | | | - FHA loans will have a required 3.5 percent |
| more people to have access to decent and affordable | | | | downpayment |
| housing. | | | | - Prohibits seller-funded downpayment assistance |
| Signed by the president in July 30, the housing bill may | | | | - Allows downpayment assistance from family |
| be the most significant housing bill in the last decade. It | | | | members |
| will help homeowners avoid losing their homes due to | | | | - A $3.9-billion budget aimed at repairing abandoned |
| difficult mortgage payments. It also gives them the | | | | and foreclosed properties in several communities |
| opportunity to switch to more affordable mortgages. | | | | - $15 billion in tax cuts |
| The following are included in the housing bill: | | | | - Foreclosure counseling grants amounting to $180 |
| - Refinancing to cheaper, more affordable fixed-rate | | | | million |
| mortgages through the Federal Housing Administration | | | | Countering foreclosures is an important aspect of this |
| (FHA) | | | | bill. It also ensures that borrowers receive protection |
| - $300-billion guarantee for subprime mortgage | | | | from banks that won't permit switching to cheaper |
| borrowers, courtesy of the FHA | | | | mortgages. They are required to take a loss when |
| - Strengthen regulations and infuse billions of dollars to | | | | you refinance-losses that are easier to shoulder than |
| mortgage giants FNM and FRE | | | | long and costly foreclosure procedures. However, you |
| - Place Fannie Mae and Freddie Mac under the | | | | need to prove that you are spending more than 31 |
| conservatorship of the Federal Housing Finance | | | | percent of your monthly income on mortgage, and that |
| Agency (FHFA) | | | | you have the ability to pay for the new loan. |