How the housing bill can benefit you

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NEW YORK (CNNMoney.com) -- A bill to help struggling homeowners is waiting to be signed by the President. Here are some top tips on how this bill can help you.

One of the main features of this bill will allow struggling homeowners to refinance into more affordable fixed rate 30-year loans.

The bill requires lenders to make major concessions, writing down the value of the loan to 90% of the home's current value. And that can mean substantial losses for your lender. Keep in mind it's up to your lender to decide whether or not to do a rescue for you.

The lender will do a new appraisal to determine your home's current value. Your income statements, bank accounts, job histories and credit scores will also be evaluated. Lenders won't sign off on a workout unless they think that they'll lose less money on that than they would by allowing a home to go through the costly foreclosure process.

If your original lender decides to do a workout, the new FHA-backed lender buys the old loan and takes over the reworked mortgage.

• You must live in your home(s) and have loans that were issued between January 2005 and June 2007.
• You must also be spending at least 31% of your gross monthly income on mortgage debt to be eligible for the program.
• You must also prove that you won't be able to keep paying your existing mortgage. Plus, you have to be able to afford the new fixed loan.

To get an FHA-backed mortgage, any other debt on the home - such as a home equity loan or line of credit - must be paid off. This program may be available as early as October, but the FHA warns it could take some time - perhaps even months - before the process is streamlined.

If you buy your home between April of this year and July of next year, you'll get a one time 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. If you're single, you have to make less than $75,000 in adjusted gross income. If you're a couple, you have to make below $150,000 adjusted gross income.

The bill is awaiting the President's signature. He is expected to sign it in a day or two.

One thing to keep in mind here: If you're a homeowner who is having trouble keeping up with your mortgage, you don't want to wait until this legislation is implemented.

Go to your lender now and ask for a loan modification. You can also call the Department of Housing and Urban Development at 1-800-CALL-FHA. There are also housing counselors available at 888-995-HOPE or the National Foundation for Credit Counseling at (866) 845-2227.