PHILADELPHIA, PA – October 5, 2010 – (RealEstateRama) — Important emergency mortgage relief for unemployed homeowners is on the way under a major new federal program authored by Congressman Chaka Fattah (D-PA) and unveiled at a news conference Tuesday with Fattah and Deputy Secretary Ron Sims of the U.S. Department of Housing and Urban Development.
Sims announced that Pennsylvania’s share of the $1 billion Emergency Homeowners Loan Program (EHLP) will be$105,804,905. The national program, worth $1 billion, is being rolled out this week in 32 states and Puerto Rico.
Congressman Fattah, who welcomed HUD’s No. 2 official to the offices of Mount Airy USA at 6703 Germantown Avenue, is the author of the Emergency Homeowners Loan Program in the Dodd-Frank Wall Street Reform and Consumer Protection Act, signed into law by President Obama in August. EHLP is modeled after the successful Homeowners Emergency Mortgage Assistance Program in Pennsylvania that Fattah wrote and guided into law as a young state legislator in 1983.
Fattah said, “This $105.8 million infusion is a major investment in Pennsylvania homeowners seeking emergency mortgage relief and it is a resounding vote of confidence in Pennsylvania’s own long-standing efforts with this kind of program.”
Sims, the No. 2 official at HUD, credited Fattah as “the person who singlehandedly insisted on a course of action and got it done” to enact the new mortgage relief law. “I want to thank Congressman Fattah for his help and his ideas,” Sims said. Emergency mortgage relief, Sims said, “is on the table because of him.”
Pennsylvania’s HEMAP is administered by the Pennsylvania Housing Finance Agency, whose executive director Brian Hudson spoke at today’s news conference and cited the state’s success with the program over the past quarter century. It has provided emergency assistance to more than 44,000 unemployed homeowners with $470 million in loans. Taxpayers have repaid $257 million – more than the $244 million in state appropriations that HEMAP has received.
HUD is finalizing regulations for the new national program and will designate an agency that will administer funds within each state. HUD expects to begin taking applications by the end of 2010.
Fattah said, “Millions of American homeowners, through no fault of their own, have lost their jobs in the current economic downturn and have faced the loss of their piece of the American dream. HEMAP is a proven success in Pennsylvania and now we will show that it will work nationally. It will keep families in their homes, providing emergency relief from foreclosure for those with a proven history for working and paying their mortgage.”
The new federal program will offer a declining balance, deferred payment “bridge loan” for up to $50,000 to assist eligible homeowners for up to 24 months. The loans will provide assistance with delinquent taxes and insurance as well as the mortgage principal and interest. Eligible homeowners are generally those who have lost jobs or significant income, have previously been keeping up with their mortgage but now face foreclosure.
Fattah, Sims and Hudson were joined by Mount Airy USA interim director Jason Salus who described how his non-profit and its housing counselors have worked with homeowners facing foreclosure or mortgage distress to keep them in their homes.