On Friday, President Obama signed the proposal for the extension and expansion of the first time home buyer $8,000 tax credit scheme, which was earlier to end on December 1. The proposal had been passed in the House via voting and just required the President's signature to make it official and binding.

Under the new scheme, not only will the $8,000 credit for first time homebuyers be extended till end of June, there will be special unemployment benefits offered as well. Also, homeowners of houses which are five year old or more will be eligible for credits too. The income limits have also seen a raise, and while single buyers can earn up-to $125,000, married couples can earn as much as $225,000.

As per the scheme, first time homebuyers, as well as people who have not owned a home in 3 years or more, qualify for a rebate of as much as $8,000. Buyers who have lived in the home they are looking to change for a minimum of 5 years qualify for a $6,500 rebate. To be eligible for the credits, the homes have to be purchased before May 1, and the deal has to reach a closure before July 1.

"The new version of the tax credit has the potential to stimulate the housing market even more than the old version due to the fact that more people will qualify under the new rules", said Gibran Nicholas, chairman of the CMPS Institute, an organization that certifies mortgage bankers and brokers. The revamped and expanded scheme is being the Government's way of encouraging people to buy home so that the economy can recover faster.