Mortgage aid open to more California borrowers
A state-run program that helps homeowners struggling to pay their mortgages now has broader eligibility guidelines, opening up help to borrowers who did “cash-out” refinances and own multiple properties, said California Housing Finance Agency officials on Monday.
The mortgage-aid effort, called Keep Your Home California, so far has helped close to 8,000 low- and moderate-income households that are behind on loan payments or close to default, according to agency leaders.
“This expanded eligibility will allow more families to qualify and receive greater assistance,” said California Housing Finance Agency Executive Director Claudia Cappio, in a statement. “We are continuously evaluating our experience so far and making adjustments like these based on the initial results of the Keep Your Home California program.”
Keep Your Home California has four parts that include: mortgage help for the unemployed, mortgage aid for homeowners with documented financial hardship, relocation help for those in the midst of a short sale or deed-in-lieu of foreclosure, and reduction of principal. The programs, paid for by the U.S. Treasury Department’s Hardest Hit Fund, is costing taxpayers $2 billion.
Monday’s announced changes include:
–Allowing homeowners who completed “cash-out” mortgage refinancing to take part in the four programs. Such borrowers were excluded before.
–Allowing borrowers who own more than one property to apply. Program officials said this will be particularly helpful to those who co-signed on properties for family members.
–Offering mortgage aid to unemployed borrowers for nine months, instead of six. Such homeowners can get up to $3,000 a month. To qualify, you must receive unemployment benefits.
–Reinstating up to $20,000 in past-due mortgage payments instead of the previous $15,000 cap.
About Keep Your Home California
California’s programs, which are called Keep Your Home California, were developed in collaboration with numerous community partners, foreclosure counselors, housing advocates and others directly involved in helping struggling homeowners.
Each of the Keep Your Home California programs is designed to address one or more aspects of the current housing crisis by doing the following:
- Helping low and moderate income homeowners retain their homes if they either have suffered a financial hardship such as unemployment, have experienced a change in household circumstance such as death, illness or disability, or are subject to a recent or upcoming increase in their monthly mortgage payment and are at risk of default because of this economic hardship when coupled with a severe decline in their home’s value.
- Creating a simple, effective way to get federal funds to assist low and moderate income homeowners who meet one or all of the objective criteria described above. Speed of delivery will be balanced with fulfillment of the specific program’s mission and purpose.
- Creating programs that have an immediate, direct economic and social impact on low and moderate income homeowners and their neighborhoods.