In tough economic times, some homeowners have found themselves in a startling predicament—after facing an unexpected job loss or reduction in wages, they are struggling to make their mortgage payments on time. As we speak with many of these homeowners across the country, they express confusion about where to turn for help. Many homeowners wonder if help is available while they seek re-employment.
Struggling homeowners should know that there are more options for assistance available today than have ever been available before. This includes newer programs directed toward the unemployed, like the Hardest Hit Fund. The Hardest Hit Fund is available to assist unemployed homeowners in 18 states and the District of Columbia, representing those areas that have been “hardest hit” in the housing market downturn. All participating housing finance agencies (HFAs) are now accepting homeowner applications.
Cherea Crayton is a homeowner in Montgomery, Alabama who found peace of mind through the Hardest Hit Fund after reaching out for help. Cherea was a program director at a regional vocational college when the economy began its downward swing. Organizational restructuring eliminated her position, and she found herself unemployed unexpectedly.
“I was living off my savings, but that had run out,” said Cherea. “I could no longer make my mortgage payment.”
When she read in the newspaper that Alabama Governor Robert Bentley had announced a new program designed for homeowners struggling to make their mortgage payments due to job loss, Cherea jumped at the opportunity. The program was Hardest Hit Alabama (HHA), funded by the Hardest Hit Fund.
“The HHA employees were very helpful with all my questions and concerns,” said Cherea. “They kept me calm and were a great resource.”
On Cherea’s behalf, HHA makes a payment to her mortgage servicer on a monthly basis while she seeks re-employment. Through HHA, eligible homeowners receive assistance to pay their mortgage payments and all other mortgage-related expenses, including payments on any subordinate liens, while they are unemployed or underemployed. Homeowners can receive assistance for up to 12 months, with total payments up to $15,000.
“Hardest Hit Alabama has been such a blessing to me,” said Cherea. “A burden has been lifted, so that I can focus on regaining employment, not how I am going to keep my house.”
Alabama homeowners who have been declared eligible to receive state-administered unemployment compensation benefits may apply. To qualify, applicants must have a total annual household income of less than $75,740, and the unpaid principal balance on their home’s mortgages must be less than $258,690. Alabama homeowners can learn more on the state’s website at www.hardesthitalabama.com.
For unemployed homeowners with a residence located in one of the 43 Alabama counties declared as disaster areas after the April tornadoes, HHA provides additional assistance of up to 18 consecutive payments not to exceed $25,000 per household.
“This program saved me,” Cherea stated. “Without it, I would either be homeless or in the foreclosure process. HHA preserved my sense of self, so that I can make a fresh start.”
We encourage any homeowner facing financial hardship and struggling to pay their mortgage to work with a HUD-approved housing counselor to understand their options. Many times, the sooner a struggling homeowner reaches out for assistance, the more options that are available for them. Homeowners can call 888-995-HOPE (4673) to speak with a housing counselor or visit MakingHomeAffordable.gov.
Mark McArdle is Director of the Hardest Hit Fund.