Transition Assistance Program offers $5,000 to families looking for a fresh start

Note: This is the final blog in a four-week series that details the four programs available from Keep Your Home California.

Sometimes even best efforts fail.

When a cash-strapped homeowner makes the decision that they can no longer meet the demands of being a homeowner, our program offers help to transition to a better housing situation.

The Transition Assistance Program offers as much as $5,000 to help low- to moderate-income homeowners move to another form of housing – enough money for covering moving costs, a security deposit and rent for many families.

The program was established to be used in conjunction with a mortgage servicer-approved short sale or deed-in-lieu of foreclosure to help homeowners with a smooth as possible transition to new housing, whether it’s an apartment or moving in with relatives.

Of course, there are some requirements, most notably the income limit – 120% of the area’s median income as defined by the California State Department of Housing and Community Development. By the way, the income limits are higher than most homeowners think, from $68,650 in several counties to as much as $121,900 in San Francisco and San Mateo counties.

Homeowners also must occupy and maintain the home until it’s sold or returned to the lender as negotiated. You know, cut the lawn, keep the house clean and leave appliances and fixtures in place on moving day. In return, you could get as much as $5,000. Rather easy, huh?

Now, mortgage servicers – basically the lender that collects the mortgage payments – must participate in the Transition Assistance Program. More than 20 mortgage servicers, including GMAC and U.S. Bank, participate in the program http://www.keepyourhomecalifornia.org/participating.htm. And more mortgage servicers join Keep Your Home California every few weeks, with some opting to participate in the Transition Assistance Program.

So, if you are against the ropes and a short sale or deed-in-lieu of foreclosure is the most viable option, check if you qualify and if your mortgage servicer participates in the Transition Assistance Program. You could get $5,000 to help you with a fresh start in a new residence.

But don’t delay. The program has $2.3 million available, with a goal of helping about 450 to 500 homeowners. Once those dollars are gone, the program ends.

If you would like more information about Keep Your Home California, the Transition Assistance Program or the other three programs, check www.KeepYourHomeCalifornia.org (www.ConservaTuCasaCalifornia.org in Spanish) or call 888-954-5337 from 7 a.m. to 7 p.m. Monday through Friday, and 9 a.m. to 3 p.m. Saturdays.

Image: digitalart / FreeDigitalPhotos.net

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Keep Your Home California, mortgage servicers help homeowners facing underwater mortgages

 Note: This is the third blog in a series that details the four programs available from Keep Your Home California.

Many cash-strapped homeowners in California are staggering from a powerful one-two punch – getting behind on their monthly mortgage payments while the value of their home plummets.

For these hard-hit homeowners, the American dream has become a real-life nightmare. But a Keep Your Home California program can cut principal, lower monthly payments and reduce the number of toss-and-turn nights.

Keep Your Home California

The appropriately named Principal Reduction Program offers low- to moderate-income homeowners as much as $50,000 to reduce the money owned on their mortgage. Now, lenders/mortgage servicers must participate in the program – and provide capital on a dollar-for-dollar matching basis. So, some homeowners could receive as much as $100,000 over a three-year period (now, that got your attention, huh?)

Currently, 11 mortgage servicers participate in the Principal Reduction Program, including Bank of America and GMAC. But more mortgage servicers (learn about servicers here) join the lineup every few weeks, so keep checking the complete list at http://www.keepyourhomecalifornia.org/participating.htm.

Keep Your Home California – funded with $2 billion as part of the U.S. Treasury’s Hardest Hit Fund – has set aside more than $790 million to assist homeowners “underwater” with their current mortgages through the Principal Reduction Program. And there are many homeowners that owe more – in many cases, a lot more – than the current value of their home.

In fact, the GoldenState has more than 2 million underwater mortgages, about 30 percent of the outstanding mortgages – the fifth-highest rate in the nation, according to industry tracker CoreLogic. However, California is far from the hard-to-believe 60% rate in Nevada.

So, as you can tell from the data, news reports and just talking with family members, friends and neighbors – or maybe even looking in the mirror – underwater mortgages are a serious problem in the state.

Now, just like any of the Keep Your Home California programs, there are some requirements, most notably the mortgage must be delinquent or at risk of imminent default.

In addition, just like the previously mentioned Mortgage Reinstatement Assistance Program, homeowners must have adequate income to make the modified mortgage payments. Quite simply, we need to ensure that homeowners approved for the program are financially able – and willing – to make the monthly payments and meet lender requirements. Otherwise, we are setting aside dollars that could be used for another family in desperate need of mortgage assistance.

The Principal Reduction Program also follows the same basic requirements as those mentioned in the previous two blogs:

  • The first lien mortgage must be originated on or before Jan. 1, 2009.
  • The applicant must own and occupy the home, which includes condominiums or town houses.
  • The house must be the homeowner’s primary residence.
  • Homeowners must agree to provide all necessary documentation.
  • Financial hardship cannot be from a voluntary employment resignation (as in “I quit!”).

The Principal Reduction Program has other requirements, so we encourage you to read the summary guidelines at http://www.keepyourhomecalifornia.org/programs/prp.pdf .

But if you’re a homeowner facing foreclosure or are seriously underwater with the mortgage, consider the program – and let Keep Your Home California work for you.

As always, if you would like more information about Keep Your Home California and our four programs, check www.KeepYourHomeCalifornia.org (www.ConservaTuCasaCalifornia.org in Spanish) or call 888-954-5337 from 7 a.m. to 7 p.m. Monday through Friday, and 9 a.m. to 3 p.m. Saturdays.

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Get Back on Track with Mortgage Reinstatement Assistance Program

Keep Your Home California

Note: This is the second blog in a four-week series that details the four programs available from Keep Your Home California.

Life has many twists and turns, and sometimes circumstances can throw a rather wicked curve.

Take the current economy and employment situation, where almost one of every eight Californians is jobless, many more have accepted lower-paying or part-time positions, and others face furloughs or hefty pay cuts.

For hard-hit homeowners, a loss of income can make the monthly mortgage payment a rough road. Sometimes, homeowners may miss a couple mortgage payments, and catching up can be tough.

So, Keep Your Home California established a program that helps homeowners get back on track when they face imminent danger of losing their home to foreclosure.

The Mortgage Reinstatement Assistance Program allows low- to moderate-income homeowners to reinstate their past-due mortgage loans. Basically, if you are behind on payments – but not in foreclosure – we can help with as much as $20,000. Now, how much depends on numerous factors, so we encourage homeowners to learn more about the program at www.KeepYourHomeCalifornia.org and call our counseling center at 888-954-5337.

A few of the more straightforward program requirements include:

  • The loan must be less than two payments delinquent as of the date of request for assistance.
  • The applicant must own and occupy the home, which includes condominiums or town houses.
  • The house must be the homeowner’s primary residence.
  • Financial hardship cannot be from a voluntary employment resignation (as in “I quit!”).

Another requirement, one that deserves at least a few sentences – homeowners must have adequate income to make the reinstated first lien mortgage. The Keep Your Home California program will help cure the delinquent first mortgage, including possible payments to reinstate the loan from foreclosure, but we must make sure homeowners can afford the payments down the road. So, the mortgage payment cannot exceed 31 percent of the homeowner’s gross monthly income.

Quite honestly, the last thing we would want to do is get a homeowner in good standing on their mortgage only to have them start missing payments a few months later, especially when those dollars could benefit another homeowner able – and willing – to stay current on their loan.

And, of course, just like all of the four programs, your mortgage servicer must participate in the program. A vast majority of the 50 mortgage servicers currently participating in Keep Your Home California (see the complete list at http://www.keepyourhomecalifornia.org/participating.htm) signed on for the Mortgage Reinstatement Assistance Program. (Get the details on mortgage servicers from this previous blog.)

Keep Your Home California has allocated $129.4 million for the Mortgage Reinstatement Assistance Program. We estimate the program will help about 9,200 homeowners, based on an average funding of $14,048.

So, now that you know the basic information about the Mortgage Reinstatement Assistance Program, check out the details at http://www.keepyourhomecalifornia.org/mrap.htm and call 888-954-5337 to see if it will work.

If you would like more information about Keep Your Home California and our four programs, check www.KeepYourHomeCalifornia.org (www.ConservaTuCasaCalifornia.org in Spanish) or call 888-954-5337 from 7 a.m. to 7 p.m. Monday through Friday, and 9 a.m. to 3 p.m. Saturdays.

Image: Danilo Rizzuti / FreeDigitalPhotos.net