Become Our Fan
June 29th, 2010
Wednesday the U.S. Treasury Department announced its approval of the California Housing Finance Agency’s (CalHFA) plan to use nearly $700 million in federal funding to develop programs to help homeowners struggling to meet their mortgage payments. The CalHFA will implement four programs to help Californians remain in their homes.
The following are brief summaries of the programs CalHFA will implement under the Keep Your Home Program:
Unemployment Mortgage Assistance (UMA) – Intended to assist homeowners who have experienced involuntary job loss. CalHFA will provide temporary financial assistance in the form of a mortgage payment subsidy of varying size and term to unemployed homeowners who wish to remain in their homes but are in imminent danger of foreclosure due to short-term financial problems. These funds could provide up to six months of benefits with a monthly benefit of up to $1,500 or 50% of the existing total monthly mortgage, whichever is less.
Mortgage Reinstatement Assistance Program (MRAP) – Intended to assist homeowners who have fallen behind on their mortgage payments. CalHFA will provide limited financial assistance in the form of funds to reinstate mortgage loans that are in arrears in order to prevent potential foreclosures. These funds will provide benefits of up to $15,000 per household or 50% of the past due amount, whichever is less, with a required dollar-for-dollar contribution match from the lender, servicer, insurer and/or borrower.
Principal Reduction Program (PRP) – Intended to assist homeowners who have severe negative equity. CalHFA will provide capital on a matching basis with participating financial institutions to reduce outstanding principal balances of qualifying borrowers with negative equity. Principal balances will be reduced to market levels needed to prevent avoidable foreclosures and promote sustainable homeownership. The principal reduction program should most likely be a prelude to loan modification.
Transition Assistance Program (TAP) – Intended to assist homeowners with relocation assistance when it is determined that they can no longer afford their home. CalHFA’s transition assistance will be used in conjunction with servicer/investor short sale and deed-in-lieu of foreclosure programs in order to help borrowers transition into stable and affordable housing. Borrowers will be responsible to occupy and maintain the property until the home is sold or returned to the lender as negotiated. Funds will be available on a one-time only basis.
Think you may be eligible? Check out the eligibility requirements to learn more.
If a short sale is a better option for you, remember I am a Certified Distressed Property Expert as well as a Short Sales and Foreclosures Resource. I have the experience and knowledge to help you navigate through your options. Give me a call today if you’d like to discuss whether or not you may qualify for a short sale.