HUD gives OK to PHFA foreclosure program
More than $100 million in federal funds is now available to distressed Pennsylvania homeowners through the Pennsylvania Housing Finance Agency. PHFA recently received approval from the U.S. Department of Housing and Urban Development (HUD) to administer the $105 million Emergency Homeowners Loan Program (EHLP).
“The Emergency Homeowners Loan Program will provide limited and targeted assistance to help working families get back on their feet and keep their home while they look for work,” said HUD Secretary Shaun Donovan. “We are pleased to get the program off the ground in Pennsylvania, which is already working to help keep families in their homes during difficult economic times.”
EHLP is a bridge loan program designed to help unemployed families pay their mortgages. The $50,000 bridge loan, (a zero percent interest, non-recourse, subordinate loan) was created to assist borrowers with payments on their mortgage principal, interest, mortgage insurance, taxes and hazard insurance for up to 24 months.
Under the program, eligible borrowers must:
• Be at least three months delinquent in their payments and have a reasonable likelihood of being able to resume repayment of their mortgage payments and related housing expenses within two years.
• Have a mortgage property that is the principal residence of the borrower, and eligible borrowers may not own a second home.
• Demonstrate a good payment record prior to the event that produced the reduction of income.
“We are happy to be able to assist qualified Pennsylvanian’s avoid foreclosure,” said Brian A. Hudson, Sr., PHFA executive director. “A team is in place at PHFA to begin administering the program.”
EHLP was created by the Dodd-Frank Wall Street Reform and Consumer Protection Act. The law authorized HUD’s Secretary to allow funds to be administered by states that have an existing program that provides substantially similar assistance to homeowners.
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