Some of the hardest-hit states with unemployment and fallen home prices soon will begin disbursing $7.6 billion in federal aid to help struggling home owners avoid foreclosure.
Known as the “Hardest Hit Fund,” 18 states will receive this federal aid. The federal support mostly targets lower-income joblessness and underemployed home owners.
The funds will provide forgivable loans for mortgage payments or help home owners get caught up on mortgage payments that they have fallen behind on. The loans are forgiven after five years if the home owner remains in home and keeps current on mortgage payments.
California will get the most assistance, with nearly $2 billion in aid, which it already has started disbursing. Florida is second with $1.1 billion in aid coming, and the state expects to launch its program by March.
The state programs will differ in rules and benefits. In Nevada, for example, the program will offer up to $500 a month for up to six months to help the unemployed make their mortgage payments.
To find out which states are receiving federal assistance, visit the Treasury Department’s resource page on the Hardest Hit Fund.
Source: “More States Launch Help for Distressed Homeowners,” USA Today (Feb. 9, 2011)