A credit for current homeowners who purchase a new main residence between November 7 and April 30, 2010 was included in the bill President Obama signed into law last Saturday. H.R. 3548 is an expansion and extension of the first time homebuyer tax credit that would otherwise expire at the end of November.  Both the House and Senate passed the new legislation by wide margins. A credit for current homeowners who purchase a new main residence between November 7 and April 30, 2010 was included.  The credit will be up to $6500 for married joint income tax filers and $3250 for single filers and married people, filing separately. One restriction is current homeowners must have resided in the home being sold consecutively for 5 of the last 8 years.  A contract to purchase must be in effect on April 30 or before, and the purchaser will have until July 1, 2010 to close.  There are also income limits attached to the new home seller credit: $125,000 for single tax filers and $225,000 for married filers.  The home may not cost more than $800,000, and the home may not be purchased by a dependent.  They must live in the new residence for at least three years or they will need to pay the credit back. There is no  restriction that would apply to homeowners who are selling their home by Short Sale to avoid foreclosure.  Normally, a Seller who sells a home at a loss that the Lender absorbs is not allowed to benefit from the sale of the home.  However, in an effort to provide incentives for everyone to make property productive again, the federal government has been showing more interest in helping troubled homeowners more directly.  The fact that the rules for this tax credit do not seem to exclude Short Sale homeowners is an indication of the government’s recognition that people in this situation are hurting and could use the tax break in order to get a clean start. This is in addition to the update in May of the directive that implemented new incentives for Lenders and junior lien holders to allow up to $1500 at a Short Sale closing for the Sellers to use toward moving expenses. The StopForeclosureShortSaleTeam.com will be negotiating this allowance for every homeowner that meets the requirements of a short sale for a primary residence. The foreclosure process is still a lengthy process. For anyone that receives a lis pendens or notice of default and wants to know more about what happens after foreclosure contact StopForeclosureShortSaleTeam.com to find out what your optiions are. We can give you information on forebearance or loan modification, deed in lieu, or short sale. We will work with real estate agents and those who have their house for sale by owner. SP