Emergency Loans For Homeowners In Trouble
Posted on April 26th, 2011
Connecticut homeowners facing foreclosure because of unemployment or medical bills may get to tap into $33 million in interest-free loans intended to keep distressed borrowers in their homes.
The Connecticut Housing Finance Authority and CHFA-approved counseling agencies are now accepting applications for the federal Emergency Homeowners’ Loan Program, created by the financial services reform legislation approved by Congress last year.
The loans — up to $50,000 per household — don’t have to be repaid as long as the borrowers’ homes remain primary residences for five years and the borrowers make mortgage payments on time during that same period.
To qualify for the program, homeowners must be at least 90 days delinquent on their mortgage payments, meet income thresholds and have suffered a significant reduction in income.
There also must be a reasonable likelihood that the borrower will be able to resume paying their mortgage and other housing expenses within two years.
The funds are part of $1 billion set aside for the U.S. Department of Housing and Urban Development in the Dodd-Frank Wall Street Reform and Consumer Protection Act. Connecticut is one of five states to qualify for funding because it had a similar state program already in place, the Emergency Mortgage Assistance Program.
Dara Kovel, CHFA’s chief housing officer, said the federally funded program has a short time frame. All loans must be under commitment by Sept. 30, she said.
“This federal program provides CHFA with an additional tool to provide homeowners stability and to support Connecticut’s economic recovery,” Kovel said.
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Tags: Homeowners, Homeowners Trouble
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