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New programs help keep families in their homes

POSTED February 11, 2011 8:29 p.m.
The California Housing Finance Agency announced on Thursday the implementation of four programs intended to fight California’s foreclosure crisis, and to keep families in their homes.The federally funded programs, made possible by the U.S. Treasury Department’s Hardest Hit fund, will be operated under the umbrella title of “Keep Your Home California.” “Our goal is to get the very most out of these federal dollars to assist California families,” said Steven Spears, executive director of CalHFA. “With families struggling through a number of financial hardships and the disruption in the real estate market, these programs will help those in need while stabilizing neighborhoods and communities severely impacted by foreclosures.”The nearly $2 billion will directly help low and moderate-income homeowners struggling to pay their mortgages. In Stanislaus County, that cutoff point is an annual income of $71,400 for a family of four.All four programs are for those who have fallen behind on their mortgages and owe significantly more than the current value of their home. The mortgage must be the first lien loan and have an unpaid principal balance which does not exceed $729,750.Participants must also be unemployed or facing another financial hardship, such as death, illness, disability, or loss of income. Borrowers must own and occupy their home as a primary residence, and have adequate income to sustain modified mortgage payments.“In partnership with the federal government, Keep Your Home California is one more step we are taking to help low and moderate income California families who are struggling to remain in their homes,” said Assemblymember Norma Torres, chair of the Assembly Committee on Housing and Community Development. “No one program will solve the foreclosure crisis affecting our state, but together we hope to make a difference for as many families as possible.”The programs offer mortgage assistance of up to $3,000 per month to those who have involuntarily lost jobs, up to $15,000 to help homeowners who have fallen behind on mortgage payments due to a temporary change in a household circumstance, capital to reduce outstanding balance for those at risk of default, and relocation assistance when it is determined individuals can no longer afford their homes.Each program requires the participation of the mortgage servicer, either to modify the existing loan into one which the homeowner can afford, or to conduct a short sale in the case of the relocation program.“The problems of unemployment and the unprecedented disruption in our real estate markets have impacted so many families,” Spears said. “These programs are designed to move homeowners who have been told ‘no’ into the ‘yes’ category and qualify them for a mortgage they can afford over the long term.”Currently, GMAC, Guild Mortgage, California Housing Finance Agency, and California Department of Veterans Affairs are fully participating with all four programs. Other servicers – including Bank of America, JPMorgan Chase, CitiMortgage and Wells Fargo – are currently participating in some, but not all programs at this time. More servicers are expected to join the program in the coming weeks.As those additional providers come on board, state officials hope the mortgage help can help to stem the foreclosure crisis – and to turn the economy around."The foreclosure crisis continues to hinder our potential for economic recovery, and strips stability from our communities,” said Assemblymember Mike Eng, chair of the Assembly Committee on Banking and Finance. “I'm pleased that the Keep Home California program is ramping up to address these challenges and, as the program moves forward, I will continue to monitor its progress to ensure that it's an all around success at assisting California borrowers.”To apply for assistance, homeowners should contact the Keep Your Home California call center toll-free at (888) 954-5337 or their mortgage servicer. For more information, visit KeepYourHomeCalirofnia.org

To contact Alex Cantatore, e-mail acantatore@turlockjournal.com or call 634-9141 ext. 2005.

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