How the housing bill helps you

A housing bill intended to help hundreds of thousands of struggling homeowners, may soon become law. Here's what that bill means to you.

1) Get the basics
One of the main features of this bill will allow struggling homeowners to refinance into more affordable fixed-rate 30-year loans. If your lender decides to let you refinance under this legislation, they must take a haircut of at least 15 percent of the value of the appraised home—that figure takes into account fees your lender will have to pay. And you’ll be able to refinance into a 30 year fixed loan backed by the Federal Housing Administration.

2) Get your qualifications
To qualify, your mortgage debt to income ratio on your old loan must not be more than 31 percent. For example, if you make $4,000 a month, your monthly mortgage payment can’t exceed $1240 dollars to qualify. Plus, you have to be able to afford the new fixed loan. Remember, even if you do qualify your lender has to decide to go along with the plan.

3) Claim your credits
Tax credits that is! If you buy your home between April of this year and July of next year, you’ll get a dollar-for-dollar tax refund of $7500. But…there is a catch. You have to repay this over the course of 15 years. It acts like an interest-free loan. If you sell your house and make a profit, but you haven’t repaid the credit in full—you’ll owe Uncle Sam the balance. To qualify for this you have to meet certain income limitations.

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