Help From the Government for the Unemployed Facing Foreclosure
The U.S. Department of Housing and Urban Development, or HUD, and the U.S. Department of Treasury are working together to help unemployed homeowners facing foreclosure stay in their homes. The homeowner must work with his mortgage servicer to obtain an alternative payment option or receive a mortgage subsidy. The Homeownership Preservation Foundation provides information on the all the foreclosure prevention programs available.
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Home Affordable Unemployment Program
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The Home Affordable Unemployment Program, or UP, helps distressed homeowners obtain a forbearance on their mortgage payment. A forbearance temporarily suspends or reduces the mortgage payment. To qualify for help, the homeowner must be receiving unemployment benefits during the forbearance period. The home facing foreclosure must be the primary place of residence. Also the unpaid principal balance on the mortgage cannot exceed $729,750 for a single family home. The forbearance period is for a minimum of three months. Your mortgage servicer must be a participating lender for you to qualify for help.
Emergency Homeonwers Loan Program
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HUD has provided $1 billion for the Emergency Homeowner's Loan Program, or EHLP, to help unemployed homeowners facing foreclosure. Homeowners who have experienced a 15 percent decrease in income can apply for a declining balance loan for up to $50,000. There is no repayment required on the emergency loan for five years. After that, the loan balance will decline 20 percent annually. The money can be used to pay for the mortgage, taxes, any payments in arrears and other mortgage-related costs.
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Hardest Hit Fund
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The Treasury Innovation Fund for the Hardest Hit Housing Market has provided money to states that had a 20 percent decline in home values and increased unemployment rates. Unemployed homeowners can get help with making their monthly payment with a mortgage subsidy. This program is designed to provide homeowners additional time to find employment. To qualify for help, the homeowner must be low-to-moderate income. Also, the home facing foreclosure must be the primary place of residence. The homeowner must be eligible to receive unemployment benefits.
HOPE Hotline
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The Homeowner's HOPE hotline is available 24 hours a day to help unemployed homeowners facing foreclosure. These HUD-approved housing counselors can evaluate the homeowner's finances and determine which foreclosure prevention program she is eligible for. The homeowner can ask the counselor to contact her mortgage servicer and work out a payment plan. These services are provided at no cost to the unemployed homeowner. Before you call, you should be prepared to have your pay stubs, tax returns, and copies of your monthly expenses ready to be submitted with your application for help.
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References
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