A new program was recently announced by the California Housing Finance Agency (CalFHA) to help California home owners stay in their homes. The United States Treasury Department has approved nearly $2 billion in federal funding for this new program.
The program is focused on assisting families of low and moderate income levels to maintain their homes whenever possible. The program known as “Keep Your Home” provides (depending on each situation) principal reduction, catch up of late mortgage payments, and even relocation expense reimbursement.
Some highlights of the program include:
- Homeowners who have lost their employment and are in default with their mortgage payments or already entered the foreclosure process can qualify for mortgage payment subsidy up to $1500 or 50% of their mortgage payment, whichever is less, for up to 6 months.
- Homeowners that have not paid one or more mortgage payments can receive up to $15,000 or 50% of the past due mortgage payment, whichever is less. The assisted payment is designed to bring the mortgage current and prevent foreclosure action. The lender must match the payment on a dollar-for-dollar basis.
- Homeowners with severe negative equity are eligible for up to $50,000 to reduce the principal balance and thus avoid a possible foreclosure action. The lender must agree to this and match the principal reduction on a dollar-for-dollar basis.
- Homeowners that cannot afford their homes and are willing to short sale or offer their home to the bank through a deed-in-lieu of foreclosure can qualify up to $5,000 for relocation expenses.
Only lenders who agree to sign up for this assistance program can participate. If you are in need of assistance, contact your lender immediately to find out if they are participating in the CalFHA “Keep Your Homes” program.
In order to qualify for any of the new CalFHA “Keep Your Homes” programs, the Yuba City homeowner must occupy the home as a primary residence and meet the income requirements as stated. In the case of modified mortgage payments or reduced principal adjustments, the applicant must prove the ability to make the new adjusted mortgage payments. Also required is a statement of hardship from the homeowner. All properties must be located in California and cannot be abandoned, vacant or in need of serious repair.