The Pennsylvania Housing Finance Agency is striving to help direct struggling homeowners to the program before a Sept. 30 application deadline. The program is backed by a $105 million pledge by the federal Department of Housing and Urban Development to Pennsylvania.
To date the state housing agency has committed only $27,300,296 to 755 approved borrowers. There is still $78 million in the pot and a need for applicants. After the Sept. 30 deadline the money is gone, according Steve Elliott, communications director of the housing agency.
“When people become delinquent in their mortgage payments, many times they are reluctant to go for help,” Elliott said.
The state housing agency is reaching out to homeowners whose financial difficulties fit the federal Emergency Homeowners Loan Program’s criteria.
“They really should not delay, even if it is difficult to talk about, there is an opportunity for some homeowners to avoid foreclosure, but the time is limited to apply for the program,” he said.
The state agency has been pushing the program since the beginning of April when it started.
“It is a real welcome addition to the toolbox for people to help save their homes, especially with the state’s Homeowners Emergency Mortgage Assistance Program going away in this year’s budget,” said Jeffrey Masterson, executive director for the Community Action Partnership for Somerset County, Tableland Services Inc.
The state mortgage assistance program is no longer accepting applications.
The 2011 state budget included $2 million for the mortgage assistance program, which is less than the state housing agency has committed to participating homeowners, according to Elliott.
“The $2 million will be used to wind down the program,” he said.
Earlier this week, The United Way of Allegheny County launched a human services help line for the 11-county southwestern Pennsylvania region, for anyone who is having problems with housing, utilities, health care or job hunting. People can dial 211 or 1-800-552-4171.
“All the homeowners have to do is call us (or the United Way help line) and we will put them in touch with the counseling agency in their area, who will help them fill out the application,” Elliott said.
Homeowners will know within a few weeks after applying if they will receive the loan. And it will take a short time after that to receive the benefits of the program if accepted, he said.
“We do get a significant number of applicants who do not qualify for the loan, but that should not hold anyone back from approaching us,” Elliott said.
Under this program, there is funding for homeowners whose mortgage payments are at least three months behind, and whose current gross income is at least reduced by 15 percent due to job loss, a cut in hours or medical reasons. The maximum available through this “bridge loan” to any homeowner is $50,000, which can be used to pay for their arrears and 24 months of mortgage payments. The funds are in the form of a loan that also covers their home insurance premiums and taxes. The loan will be forgiven if the homeowners stay in the homes for the five year repayment period.
“With the way things are going (economically), individuals need to take advantage of anything out there that will work for them,” Masterson said.
To find out more information on the program call the state agency at 1-800-342-2397 or visit www.phfa.org.