Unemployed homeowners to get extra foreclosure aid

As part of the foreclosure aid, unemployed homeowners will be eligible for federal bridge loans up to $50,000 to help with mortgage payments.

By , Correspondent

  • close
    The windows and doors are boarded up on a duplex that is listed as a foreclosure in Hawthorne, Calif., Wednesday, July 21. California is among one of the 17 states receiving additional aid from the 'Hardest Hit Fund," to help with foreclosure prevention. Treasury will direct $3 billion more in aid to help prevent foreclosures.
    View Caption

Unemployed homeowners facing foreclosure were offered some relief on Wednesday when the Obama administration announced that it would extend an additional $3 billion to support foreclosure-prevention programs.

Some consumer-lending and housing advocates applauded the administration's expansion of housing aid to the unemployed.

“The biggest single cause of foreclosure today is loss of income or employment-related issues,” not expensive, subprime loans, says Barry Zigas, director of housing policy for the Consumer Federation of America.

Recommended: 10 best cities to buy short sale homes

The new programs will reach beyond the administration’s loan-modification program, which was designed to mitigate the subprime crisis and offers little assistance to unemployed homeowners with diminished income. Currently, unemployed homeowners are offered a three-month forbearance period to find work and become eligible for a modification.

With the unemployment rate stuck at 9.5 percent and the average length of unemployment at 24 weeks – nearly six months – the administration was criticized for not doing enough to help unemployed homeowners.

The increased aid was allocated as part of the financial-reform bill signed into law last month. A third of the additional aid will go towards funding a new bridge-loan program for homeowners with reduced incomes in hard hit local areas, although those regions have not yet been specified. The program extends a no-interest loan of up to $50,000, which can last as long as 24 months, to assist homeowners with mortgage payments until they become financially stable.

The new federal initiative is modeled on a similar state program in Pennsylvania, which has extended loans to help unemployed homeowners since 1983. Some 45,000 Pennsylvania homeowners have taken advantage of that program successfully, according to the Philadelphia Unemployment Project (PUP), a community organization that’s lobbied for the initiative to be adopted nationally.

“More money has been repaid in Pennsylvania than paid out through the program,” says John Dodds, director of PUP.

The success of the program nationally will depend largely on how well it’s implemented, says Mr. Dodds.

“We don’t want to force [homeowners] to repay the loan until they get back on their feet,” he says. “The repayment needs to be done carefully so you don’t drive people back under again.”

The pool available for bridge loans will also likely have to expand, says Dodds, considering the number of people facing foreclosure (more than 2 million in June, according to RealtyTrac) and the unprecedented length of unemployment.

Treasury must also be sensitive when determining how to distribute the funds, says Lew Finfer, of with the PICO National Network, a group that’s pushed for increased foreclosure prevention assistance.

If only metropolitan areas or larger regions with high unemployment rates are considered, says Mr. Finfer, neighborhoods and smaller cities with high foreclosure rates could be left behind.

“The program has to be flexible,” says Finfer. “It needs to be done very thoughtfully and sensitively; there are a number of different variables to take account of.”

Finfer has been critical of the administration’s so-called "Hardest Hit Fund," which since February has targeted states with the highest foreclosure rates, providing aid to help cover homes that aren’t covered by its loan-modification program. That has included measures to assist in principal reduction and smaller bridge loan programs for the unemployed.

“There’s a reason to give more funds to states that have the biggest problems,” acknowledges Finfer. “But it seems inequitable that it’s all or nothing.”

The fund will continue, though, and has been extended to 17 states and the District of Columbia, up from just 10 original states. It now includes all states that have seen unemployment rates at or above the national average over the past year. An additional $2 billion funds will go towards expanding the Hardest Hit Fund.

Other changes to the administration's loan-modification program earlier this summer targeted homeowners who are 'underwater,' owing more than their houses are worth. Banks are now offered financial incentives to reduce principal on such mortgages, and underwater homeowners not yet in arrears on their loans can apply to refinance with an FHA mortgage.

Share this story:

We want to hear, did we miss an angle we should have covered? Should we come back to this topic? Or just give us a rating for this story. We want to hear from you.

Loading...

Loading...

Loading...

eZ debug

Clear cache:

Quick settings:

Timing: Jul 09 2014 07:23:30
Script start
Timing: Jul 09 2014 07:23:30
Module start 'content'
Notice: PHP: E_NOTICE Jul 09 2014 07:23:30
Undefined index: path in /var/www/www.csmonitor.com/extension/ezwebin/autoloads/ezpagedata.php on line 158
Notice: PHP: E_NOTICE Jul 09 2014 07:23:30
Undefined index: path in /var/www/www.csmonitor.com/extension/ezwebin/autoloads/ezpagedata.php on line 175
Notice: PHP: E_NOTICE Jul 09 2014 07:23:30
Undefined index: path in /var/www/www.csmonitor.com/extension/ezwebin/autoloads/ezpagedata.php on line 158
Notice: PHP: E_NOTICE Jul 09 2014 07:23:30
Undefined index: path in /var/www/www.csmonitor.com/extension/ezwebin/autoloads/ezpagedata.php on line 175
Notice: PHP: E_NOTICE Jul 09 2014 07:23:30
Undefined index: meta_class_identifier_ms in /var/www/www.csmonitor.com/extension/ezfind/classes/ezfindresultnode.php on line 111
Notice: PHP: E_NOTICE Jul 09 2014 07:23:30
Undefined index: meta_class_identifier_ms in /var/www/www.csmonitor.com/extension/ezfind/classes/ezfindresultnode.php on line 111
Notice: PHP: E_NOTICE Jul 09 2014 07:23:30
Undefined index: meta_class_identifier_ms in /var/www/www.csmonitor.com/extension/ezfind/classes/ezfindresultnode.php on line 111
Notice: PHP: E_NOTICE Jul 09 2014 07:23:30
Undefined index: meta_class_identifier_ms in /var/www/www.csmonitor.com/extension/ezfind/classes/ezfindresultnode.php on line 111
Notice: PHP: E_NOTICE Jul 09 2014 07:23:30
Undefined index: meta_remote_id_ms in /var/www/www.csmonitor.com/extension/csm_base/classes/CSMFunctionCollection.php on line 1028
Warning: eZTemplate:def @ extension/csm_base/design/csm_design/templates/content/datatype/view/ezbyline.tpl:10[1] Jul 09 2014 07:23:30
Variable 'story_source' is already defined.
Warning: PHP: E_WARNING Jul 09 2014 07:23:30
exif_read_data(0809-AFREDDIE-Home-Foreclosure.jpg): Incorrect APP1 Exif Identifier Code in /var/www/www.csmonitor.com/lib/ezimage/classes/ezexifimageanalyzer.php on line 61
Timing: Jul 09 2014 07:23:30
Module end 'content'
Timing: Jul 09 2014 07:23:30
Before parse_includes
Strict: PHP: E_STRICT Jul 09 2014 07:23:30
Non-static method MugoViewExtras::get_view_extras() should not be called statically, assuming $this from incompatible context in /var/www/www.csmonitor.com/extension/mugo_view_extras/autoloads/template_operators.php on line 37
Warning: eZTemplate:def @ extension/csm_base/design/csm_design/override/templates/extra/archive.tpl:21[1] Jul 09 2014 07:23:30
Variable 'view_extra_node' is already defined.
Timing: Jul 09 2014 07:23:30
After parse_includes
Timing: Jul 09 2014 07:23:30
End

Timing points:

CheckpointElapsedRel. ElapsedMemoryRel. Memory
Script start 0.0000 sec0.0140 sec 1,286.0547 KB1,162.3281 KB
Module start 'content' 0.0140 sec1.8618 sec 2,448.3828 KB12,432.9766 KB
Module end 'content' 1.8758 sec0.0185 sec 14,881.3594 KB394.1797 KB
Before parse_includes 1.8943 sec0.0615 sec 15,275.5391 KB270.7266 KB
After parse_includes 1.9558 sec0.0010 sec 15,546.2656 KB-183.6563 KB
End 1.9568 sec  15,362.6094 KB 
Total runtime:1.9641 sec
Peak memory usage:21,138.2578 KB

Time accumulators:

 Accumulator Elapsed Percent Count Average
ini_load
Load cache0.0080 sec0.4064%370.0002 sec
Mysql Total
Mysqli_queries0.1909 sec9.7089%2230.0009 sec
Looping result0.0572 sec2.9110%2090.0003 sec
Template Total1.9153 sec 97.4% 7 0.2736 sec
Template load0.0081 sec0.4105%70.0012 sec
Template processing1.9071 sec96.9964%70.2724 sec
Template load and register function0.0003 sec0.0146%40.0001 sec
states
state_id_array0.0107 sec0.5422%180.0006 sec
state_identifier_array0.0180 sec0.9149%240.0007 sec
override
Cache load0.0082 sec0.4172%730.0001 sec
eZ Find
Search0.0958 sec4.8711%10.0958 sec
Query build0.0865 sec4.4009%10.0865 sec
Class attribute list0.0819 sec4.1668%10.0819 sec
Engine time0.0080 sec0.4089%10.0080 sec
MoreLikeThis0.0000 sec0.0000%00.0000 sec
Sytem overhead
Fetch class attribute can translate value0.0008 sec0.0420%30.0003 sec
Fetch class attribute name0.0003 sec0.0174%110.0000 sec
XML
Image XML parsing0.0074 sec0.3752%30.0025 sec
class_abstraction
Instantiating content class attribute0.0002 sec0.0093%130.0000 sec
General
String conversion0.0000 sec0.0008%30.0000 sec
dbfile0.0019 sec0.0969%650.0000 sec
View Extra building0.0170 sec0.8643%40.0042 sec
Total script time:1.9662 sec

CSS/JS files loaded with "ezjscPacker" during request:

CacheTypePacklevelSourceFiles
01a980f93dc967c6e39d52a11ae2108b_1404899611_all.cssCSS3extension/csm_base/design/csm_design/stylesheets/normalize.css
extension/csm_base/design/csm_design/stylesheets/html5b.css
design/standard/stylesheets/debug.css
extension/ezwt/design/standard/stylesheets/websitetoolbar.css
extension/csm_base/design/csm_design/stylesheets/jquery-ui-1.10.3.custom.min.css
extension/csm_base/design/csm_design/stylesheets/desktop.css
ede0a88fd146f1a095d27fb22227d0e5_1398846822.jsJS2extension/csm_base/design/csm_design/javascript/modernizr.js
extension/csm_base/design/standard/javascript/jquery-1.10.2.min.js
1650da1ba852ac5f9af81af07e8fa105_1404899611.jsJS2extension/csm_base/design/csm_design/javascript/jquery-ui-1.10.4.min.js
extension/csm_base/design/csm_design/javascript/json2.js
extension/csm_base/design/standard/javascript/jquery.cookie.min.js
extension/csm_base/design/csm_design/javascript/jquery.mobile.custom.min.js
extension/csm_base/design/csm_design/javascript/plugins/jquery.arthole.js
extension/csm_base/design/csm_design/javascript/plugins/jquery.sticky.js
extension/csm_base/design/csm_design/javascript/plugins/jquery.csmstory.js
extension/csm_base/design/csm_design/javascript/plugins/jquery.right_column.js
extension/csm_base/design/csm_design/javascript/plugins/jquery.csmstory_editorspickdialog.js
extension/csm_base/design/csm_design/javascript/plugins/jquery.sailthru_signup.js
extension/csm_base/design/csm_design/javascript/plugins/jquery.jcarousel.min.js
extension/csm_base/design/csm_design/javascript/plugins/jquery.history.js
extension/csm_base/design/csm_design/javascript/plugins/jquery.mainNav.js
extension/csm_base/design/csm_design/javascript/plugins/jquery.gallery.js
extension/csm_base/design/csm_design/javascript/plugins/jquery.staffdialog.js
extension/csm_base/design/csm_design/javascript/jQuery.rollChildren.js
extension/csm_base/design/csm_design/javascript/pubService_extended.js
extension/csm_base/design/standard/javascript/csm/csmNew.js
extension/csm_base/design/csm_design/javascript/jquery.quiz.js
extension/csm_base/design/csm_design/javascript/jquery.spectrumQuiz.js
extension/csm_base/design/csm_design/javascript/global.js

Templates used to render the page:

UsageRequested templateTemplateTemplate loadedEditOverride
1node/view/full.tplfull/article.tplextension/csm_base/design/csm_design/override/templates/full/article.tplEdit templateOverride template
16content/datatype/view/ezxmltags/paragraph.tpl<No override>extension/ezwebin/design/ezwebin/templates/content/datatype/view/ezxmltags/paragraph.tplEdit templateOverride template
3content/datatype/view/ezimage.tpl<No override>extension/csm_base/design/csm_design/templates/content/datatype/view/ezimage.tplEdit templateOverride template
14content/datatype/view/ezxmltags/link.tpl<No override>extension/csm_base/design/standard/templates/content/datatype/view/ezxmltags/link.tplEdit templateOverride template
1content/datatype/view/ezstring.tpl<No override>design/standard/templates/content/datatype/view/ezstring.tplEdit templateOverride template
1content/datatype/view/ezxmltext.tpl<No override>design/standard/templates/content/datatype/view/ezxmltext.tplEdit templateOverride template
1content/datatype/view/ezbyline.tpl<No override>extension/csm_base/design/csm_design/templates/content/datatype/view/ezbyline.tplEdit templateOverride template
1content/datatype/view/ezobjectrelationlist.tplcontent/datatype/view/story_images.tplextension/csm_base/design/csm_design/override/templates/content/datatype/view/story_images.tplEdit templateOverride template
1content/datatype/view/eztext.tpl<No override>design/standard/templates/content/datatype/view/eztext.tplEdit templateOverride template
1content/datatype/view/ezstring.tplcontent/datatype/view/image_credit.tplextension/csm_base/design/csm_design/override/templates/content/datatype/view/image_credit.tplEdit templateOverride template
1content/datatype/view/ezxmltext.tplcontent/datatype/view/story_info_box.tplextension/csm_base/design/csm_design/override/templates/content/datatype/view/story_info_box.tplEdit templateOverride template
1content/datatype/view/ezmatrix.tplcontent/datatype/view/ezmatrix_article_related_external_links.tplextension/csm_base/design/csm_design/override/templates/content/datatype/view/ezmatrix_article_related_external_links.tplEdit templateOverride template
1pagelayout.tpl<No override>extension/csm_base/design/csm_design/templates/pagelayout.tplEdit templateOverride template
1modules/mugo_view_extras/extra_cached.tpl<No override>extension/mugo_view_extras/design/standard/templates/modules/mugo_view_extras/extra_cached.tplEdit templateOverride template
1setup/debug_toolbar.tpl<No override>design/standard/templates/setup/debug_toolbar.tplEdit templateOverride template
 Number of times templates used: 45
 Number of unique templates used: 15
 Time used to render template usage: 0.0003 secs