Foreclosure Help, Take Two {HEADLINE2} Program has a better chance
0 Comments | Palm Beach Post, Jul 3, 2010
The Obama administration’s latest effort at foreclosure prevention couldn’t come at a better time for Florida, where foreclosed properties made up nearly 40 percent of home sales in early 2010.
It will help, however, if this program actually works.
Florida is to receive $418 million in repaid financial bailout money from the administration’s $1.5 billion Hardest Hit Fund. This is one of five states that had a 20 percent or greater decline in average housing prices, and thus are eligible for the money.
The Florida Housing Finance Agency will administer the money, and hopes to assist 12,000 homeowners through its Mortgage Intervention Strategy, a program that will make up to nine months of mortgage payments for unemployed and underemployed homeowners. The agency will work with lenders to get them to forgive up to an additional nine months of payments.
“We targeted the unemployed and underemployed because they are the most vulnerable and most at risk for foreclosure,” said Cecka Rose Green, communications director for the agency. “We looked at giving qualified homeowners a bit of relief so they can look for employment that can help them … keep their home.”
Ms. Rose Green said that on average it takes 18 months for a person who is unemployed or underemployed to secure employment adequate enough to pay a mortgage. Florida’s May unemployment rate was 11.7 percent, down from April’s 12 percent, but still higher than the country’s 9.7 percent.
Homeowners must be seriously delinquent on their mortgages — 90 days or more late, or in foreclosure — to qualify for the program and must be unemployed through no fault of their own. Homeowners are considered to be underemployed if they are paying more than 31 percent of their income for housing costs. Also, household income cannot exceed 140 percent of the area median income, which is $105,560 in Palm Beach County. These rules are designed to prevent homeowners who can afford to pay their mortgages but purposefully default from getting assistance.
The program will begin in August in Lee County on the state’s west coast, which Ms. Rose Green describes as the “epicenter” of Florida’s housing crisis, and expand statewide by the end of the year. Palm Beach County, which had 28,729 seriously delinquent loans as of January, will get nearly $29 million for its residents under the proposed allocation
