Tuesday, September 14, 2010

Ohio Hardest-Hit Fund (Ohio HHF)

Directly from the Ohio Housing Finance Agency (OHFA) website:

President Obama established the Housing Finance Agency Innovation Fund for the Hardest-Hit Markets in February 2010 to provide financial assistance to families in the states most impacted by the downturn of the housing market. On August 4, the U.S. Department of Treasury (U.S. Treasury) announced the approval of the Ohio Hardest-Hit Fund (Ohio HHF) plan for $172 million. Subsequently on August 11, U.S. Treasury announced another round of funding which allocated $148 million to help unemployed and underemployed homeowners pay their mortgage. The Ohio Housing Finance Agency (OHFA) will administer the program and use the total allocation of $320 million in federal foreclosure prevention funding to help families who have fallen behind on their mortgage loans, or are having trouble making monthly payments. Homeowners experiencing a financial hardship may begin submitting applications online or over the phone on September 27, 2010.

OHFA has worked with Governor Ted Strickland, the Department of Commerce and the Save the Dream Ohio partners to develop a comprehensive, statewide strategy. The plan aims to assist 26,000 unemployed and underemployed homeowners who are experiencing financial hardship and are at-risk of mortgage loan default or foreclosure. Ohio HHF program options will assist homeowners with financial hardships who have been unable to qualify for existing loan modification and foreclosure prevention programs. Available programs will include:

• Rescue Payment Assistance will provide a payment to a participating homeowner's servicer to help bring the homeowner current on his or her delinquent mortgage. The payment could cover principal, interest, fees, delinquent taxes or escrow shortage and homeowners insurance.

• Partial Mortgage Payment Assistance will support unemployed homeowners by providing partial mortgage payments while they search for a job or participate in job training.

• Modification Assistance with Principal Reduction will provide a payment incentive to servicers to reduce a participating homeowner's mortgage principal to the level necessary to achieve a loan modification with a target of a 115 percent loan-to–value ratio or less. This program should increase the number of loan modifications that are approved and available to both Home Affordable Modification Program (HAMP) eligible and non-HAMP eligible borrowers.

• Transitional Assistance will offer an incentive to servicers to complete short sales and deed-in-lieu agreements to help homeowners exit their homes gracefully. This will allow homeowners who cannot sustain homeownership to pursue alternatives to foreclosure, reducing the negative impact on their credit rating and losses to the servicer.

If a homeowner uses Ohio HHF to stay in their home and then sells or refinances their home within five years, the assistance would be repayable from the net proceeds.

The Ohio HHF plan will launch September 27, 2010, but borrowers who are in need of immediate assistance should visit the Save the Dream Ohio website at www.savethedream.ohio.gov or call the hotline at (888) 404-4674 to get free assistance and speak directly with a housing counselor.

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