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New bill to help minorities buy homes

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Low-income, first-time homebuyers, who come up short with down payments and closing costs, can expect up to $10,000 from the federal government next spring.

President Bush, on Monday, signed the American Dream Downpayment Act, which will provide cash to low-income first-time homebuyers. The goal is to have 5.5 million new minority homeowners over the next 10 years.

In addition to being a first-time purchaser, applicants must earn less than 80 percent of the people in their area. For more information click here for HUD's front page. 

"This bill will help lower-income and minority families realize the American dream. Not only will the [American Dream Downpayment Act] create more homeowners, but it will help build and strengthen entire communities," said former HUD Secretary Mel Martinez.

The fund is an upgrade of the HOME program, which assists participating communities with affordable housing. The funding will provide $200 million annually that will help 40,000 families.

As part of the legislation, federal agencies, such as Department of Education, Federal Trade Commission and Department of Treasury, will step up efforts to educate homebuyers, protect them from predatory lenders, and listen to actual participants.

Banks, real estate companies and lenders are also getting involved to help educate first-
time homebuyers.