Consumers in the Tri-Cities area hit by income loss or reduction can still apply for mortgage payment relief. The Tennessee Housing Development Agency is working to make mortgage payments for eligible homeowners through the U.S. Treasury’s Hardest Hit Fund, and homeowners can determine their eligibility by answering 12 questions at www.KeepMyTNHome.org.
The program, backed by the federal government, is designed to help unemployed and substantially underemployed homeowners meet their mortgage obligations. Tennessee was allocated $217,315,593 for the program which is administered by states’ housing finance agencies.
THDA is Tennessee’s housing finance agency. It has developed the application website and trained its network of foreclosure prevention counselors to process the applications.
The process is for homeowners who have lost income as a result of the economic downturn and are now in need of mortgage payment assistance.
If an applicant meets the requirements, the applicant and a counselor are paired to process the application.
The assistance is prepared as a loan, but the loan is forgiven over five years, by 20 percent per year. If the family keeps the home as their primary residence for five years the loan is completely forgiven.
Foreclosure prevention counselors, who have been offering affected Tennesseans free counseling since 2008, prepare the documentation with the homeowner. If approved, payments are made directly to the servicer, the lender that collects payments from the homeowner.
The loan amounts are up to $15,000 over a 12-month period for most of Tennessee’s counties.
Several changes have been made as the program progresses. THDA began the program Jan. 4, requiring households to have suffered a 50 percent or more loss of income. That limit has been changed to 30 percent. Persons who applied before the percentage change are encouraged to apply again. The household must have a history of timely mortgage payments prior to the job loss/reduction, or no more than two 30-day late payments in the six months prior to the job loss/reduction of income. The combined amount of the mortgage principal, interest, taxes and insurance must be greater than 31 percent of the household income after the job loss/reduction of income. The program is for families whose household income is currently less than $74,980 and whose home’s total unpaid principal balance does not exceed $226,100.
Foreclosure prevention counseling continues to be available free of charge to households struggling with their payments for whatever reason. Contact Eastern Eight CDC, 221 E. Unaka Ave. in Johnson City, at 232-5097 or email firstname.lastname@example.org, for more information about counseling.