Mortgages Blog

Finance Blogs » Mortgages » Mortgage help for unemployed

Mortgage help for unemployed

By Polyana da Costa · Bankrate.com
Thursday, June 23, 2011
Posted: 10 am ET

If you are behind on your mortgage payments because you lost your job, you may be able to get up to $50,000 in help from the government.

But act quickly.

This week, HUD announced a new interest-free government loan program for homeowners who are on the verge of foreclosure. It's called the Emergency Homeowners' Loan Program (EHLP), but homeowners don't have to repay the money if they stay current on their mortgage payments for five years after they receive the assistance.

HUD received about $1 billion for this program and expects it will be able to help up to 30,000 distressed borrowers, with an average loan of about $35,000.

Those who qualify for the loan will receive assistance to pay a portion of their monthly mortgage for up to two years, or up to $50,000, whichever comes first. The deadline to apply for the program is July 22.

To be eligible for the program, you must meet the following conditions:

  • Involuntary unemployment or underemployment through no fault of your own
  • A minimum 15 percent reduction in income
  • You must be at least three months delinquent on your mortgage payments and at risk of foreclosure as of June 1, 2011. You must have a letter from your mortgage company verifying these conditions.
  • A reasonable likelihood to resume full monthly mortgage payments by the end of the program’s second year;
  • Income must be less than 120 percent of the area median income

To learn more about the program and get a pre-screening application go to www.FindEHLP.org or call
855-346-3345

The EHLP program will be offered in 32 states: Alaska, Arkansas, Colorado, Connecticut, Delaware, Hawaii, Idaho, Iowa, Kansas, Louisiana, Maine, Massachusetts, Minnesota, Missouri, Montana, Nebraska, New Hampshire, Maryland, New Mexico, New York, North Dakota, Oklahoma, Pennsylvania, South Dakota, Texas, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin and Wyoming, plus Puerto Rico.

If your state is not included here it's because your state already has a similar program, called the Hardest-Hit. The government allocated $7.6 billion for that program to help homeowners in states that have been hit the hardest by foreclosure and unemployment crisis. Florida is one of those states and received about $1 billion for the program. But I've heard the majority of the people who apply are rejected because they don't meet the requirements.

I'm curious to know how helpful EHLP is really going to be, considering most of these foreclosure prevention programs have been a disaster.

Have you tried applying for EHLP or for similar mortgage assistance programs? Please share your experience. Was it helpful to you?

«
»
Bankrate wants to hear from you and encourages comments. We ask that you stay on topic, respect other people's opinions, and avoid profanity, offensive statements, and illegal content. Please keep in mind that we reserve the right to (but are not obligated to) edit or delete your comments. Please avoid posting private or confidential information, and also keep in mind that anything you post may be disclosed, published, transmitted or reused.

By submitting a post, you agree to be bound by Bankrate's terms of use. Please refer to Bankrate's privacy policy for more information regarding Bankrate's privacy practices.
8 Comments
sue
July 12, 2011 at 1:28 am

SaganRand...My husband I were talking about this over the weekend. The decision to back the banks and not the people, ruined the publics trust in Government and spawned the Tea party. The "cram down" that some in government wanted, was pass up and the forecloses exploded. But we still realize that we need government and much of it does work. If every one is left to do what ever they can and want for themselves, the most aggressive and hostile end up taking what ever they want and even taking over. We have some of that but not totally. We need to keep regulations and enforcement in place.

Tracy C
July 05, 2011 at 11:42 pm

I don't understand why someone has to wreck their credit by defaulting for 3 months in order to get help. My unemployment just ran out and I have only $400 a month coming in for child support. In 15 years I've never been late in paying my house payment and now I'm forced to use my retirement money to save my house!

Carol
July 02, 2011 at 11:53 am

@jlks-John, both-have you ever been unemployed and can't pay your bills or buy food to live,you HAD a good paying job and now its gone and so is your money. Move in with relatives is not a answer when everyone is having money problems and why put it on them? who has 88% in their savings and investments-I have NO savings or investments of any kind-use to but now gone and I would say 75% of people are in the same boat. your working -good for you,what happens tomorrow if it was gone and your savings?? what would you say then when you can't pay your mortgage and the banks want to foreclose-out on the street?? why would you stop SSD for younger peolple if they need it? they paid into the system all the years of working and so have I-its my money and theirs also. so moving in with others- I'll pack my belongings and move in with you then till I'm on my feet. Like that idea? I lived within my means,is my fault my job went to china like so many others? Everyone should have food and shelter,clothing,no matter but how if you have a buck 50 in your pocket,your going to feed me-shelter me-put clothes on me, well Thank you I'll be waiting then for you to come through on that thought. Its not the fault of the workers who worked 20 more years and things are taken away now,house,food,clothes,car,credit,all gone in the @@@@. I think this is a great idea to help families stay in their homes and get back on their feet to find other jobs and pay their bills at the same time. Finally someone is here to HELP the working people,someone is listening. We need HELP as a country. See you soon John.

SaganRand
June 28, 2011 at 8:29 am

John;
I hear you, I do. As a life long Libertarian, I 'get it'. I will however ask this; How come tax-monies, collected from individual citizens via payroll deductions, was used to 'bail-out' banks/lenders? I paid upwards of $30,000/year in taxes during a productive work career. However, if/when my finances go south and I'm unable to stay current on my mortgage do any of the taxes I paid go to hlep ME? No, they go to the bank. <<This was a huge error in the bail out. While I disagree with the bail out in general, IF we were going to do it, it should've been via a 'pool' of funds that a tax paying citizen could 'apply' to receive temporary relief of their mortgage payments. As it is, the banks got they money (again paid from you and me) kept the money, did nothing to help anyone, and then continued onward with foreclosure action knowing they had no risk of losing money in a sherrif sale (remmber, they'll get the 'fire-sale' price AND they still get to do a difficiency judgment against the home owner and lien them to death). IN the end, the banks make out like bandits and NONE of the taxes used for this went to the benefit of those that paid into the tax pool in the first place. Shameful. Yet another example of why Harry Browne wrote "Why Government Doesn't Work"

jlksdjfl
June 27, 2011 at 11:00 am

And the government steps in to prop up housing prices for just a little while longer.

Make no mistake, this is not a program to help the people, it is a program to help the banks. And why the hell should I bother working and living within my means when the government is going to throw $50,000 my way if I do the opposite?

By the way $50,000 is more than like 88% of Americans have in savings and investments combined.

John S
June 24, 2011 at 3:36 pm

I think everyone should have food, shelter and clothing no matter what. But this needs to stop. We are carrying the 99 ers, the strategic mortgage defaults, bankruptcys, wheres my $65,000 tax return, pell grants, SS disablility for younger folks, etc etc. Where is this money supposed to come from. Let people move in with their relatives till things get better. How can we help people that really need it?