Keep Your Home California will stop accepting applications June 29 – homeowners should apply immediately

Keep Your Home California, the free mortgage-assistance program that has helped over 82,000 homeowners, is entering its final weeks. All applications for Keep Your Home California assistance must be submitted by June 29, 2018, in order to be considered for funding.

Homeowners faced with a financial hardship and worried about losing their home are encouraged to apply as soon as possible. Available program funding will soon be exhausted, which is why the program will no longer be able to accept applications after 7 p.m. Friday, June 29, 2018.

All homeowners who submit an application to Keep Your Home California by June 29 will have their files processed to a resolution. Closing the program to new applicants will not adversely affect applications in-process.

The federally funded program helps California homeowners who are dealing with a hardship – such as a cut in hours or pay, a job loss, divorce, death in the family, or extraordinary medical bills that are affecting a homeowner’s finances – and faced with the possibility of losing their home to foreclosure.

The state-managed program has been a big success, helping more than 82,000 homeowners – or the equivalent of everyone in Buena Park in Southern California or Redwood City in the Bay Area. The demand for the program has remained strong, even with a much-improved economy and housing market during the past couple years.

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In fact, Keep Your Home California has already provided more than $2 billion in funding to qualifying homeowners across the state. Additionally, another $67 million has been committed – basically dollars set aside – for those who have applied but have not yet been approved for the program. The program has been a huge success, helping homeowners in all 58 California counties, and will end more than two years before its mandated deadline of Dec. 31, 2020.

If you are going to apply for the mortgage-assistance program, now is the time. All four of the Keep Your Home California programs will be available until the final application date. Assistance from the programs is available free of charge and includes the following:

  • Unemployment Mortgage Assistance Program – Out-of-work homeowners eligible for jobless benefits from the state Employment Development Department can receive as much as $54,000 or up to 18 months in assistance, whichever comes first. In addition, the program can help homeowners catch-up on their past-due mortgage payments.
  • Mortgage Reinstatement Assistance Program – Homeowners can receive as much as $54,000 to help them catch-up on past-due mortgage payments. However, homeowners must be able to make their mortgage payments going forward.
  • Principal Reduction Program – As much as $100,000 to lower mortgage principal and help ease the financial burden of a severely underwater mortgage and, quite often, an unaffordable monthly payment. In many cases, homeowners will also enjoy a lower monthly payment. Of course, homeowners must be able to make their mortgage payments going forward.
  • Transition Assistance Program – Homeowners can receive up to $5,000 to help with relocation costs as part of an approved deed-in-lieu of foreclosure or short sale of their home.

In order to be eligible for Keep Your Home California, homeowners must meet county-by-county income limits, which range from about $84,450 in rural counties to more than $150,000 in the Bay Area. A homeowner’s mortgage servicer – the company that collects the monthly payments – must also participate in the program. Almost 250 servicers are enrolled in Keep Your Home California.

If you’re a homeowner facing a financial hardship and worried about losing your home to foreclosure, apply right away. Homeowners must complete the applications and submit all necessary documents within a 30-day period.

Homeowners interested in learning more or applying for the program should call the counseling center at 888-954-KEEP (5337) or visit www.KeepYourHomeCalifornia.org or www.ConservaTuCasaCalifornia.org for Spanish speakers.

The counseling center is open 7 a.m. to 7 p.m. weekdays and 9 a.m. to 3 p.m. Saturdays. Calls can be taken in virtually any language.

Feature photo by Min C. Chiu/Shutterstock

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Transparency helps homeowners – and Keep Your Home California

Keep Your Home California is committed to openness and transparency, educating consumers, encouraging comments, and sharing the facts and figures of its free mortgage-assistance program.

It’s been the promise from the first day of the federally funded program and remains more than seven years – and 81,500-plus homeowners – later.

The approach has allowed the state-managed program to succeed – and thrive. Comments, suggestions and, yes, even complaints have helped Keep Your Home California evolve and expand when needed.

Keep Your Home California’s website is the foundation for the commitment to transparency. The website – redesigned, in part, to improve transparency in early 2013 – offers a lot of data on the program. Online visitors will find charts, graphics, an interactive map and quarterly reports.

Some of the information available on the Reports & Statistics page include:

  • How many homeowners have been helped and funding issued by county.
  • How many dollars awarded by each of the four programs and Keep Your Home California overall.
  • How much Keep Your Home California funding remains for homeowners.
  • Federal quarterly reports and the annual audits on Keep Your Home California.
  • How Keep Your Home California has fared compared to the other states that received funding through the U.S. Treasury Department’s Hardest Hit Fund. California’s funding issued to homeowners is more than double the amount from any other state.
  • A link to the Economic Impact of Keep Your Home California: A Statewide and Regional Analysis, a detailed look at how the program has helped homeowners, neighborhoods, businesses, and local and state government. The analysis found that for every $1 of funding issued, the state’s economy benefited by $2.

Keep Your Home California also established a monthly Servicer Scorecard page, sharing information about the 240 mortgage servicers participating in the program. Data on the mortgage servicers – the companies that collect the monthly payments from homeowners – is listed, including how many transactions the servicer had each month, how responsive they are, and how they are doing when it comes to referring customers to Keep Your Home California.

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The “Success Stories” are one of the most popular pages on the website. Keep Your Home California has shared more than 100 stories from real homeowners who have benefited from using the program. All of the homeowners’ stories are provided voluntarily and only the first name and the first initial of each homeowner’s last name are used to protect their privacy.

Of course, Keep Your Home California’s commitment to transparency expands beyond the website. The program has issued almost 30 news releases and published more than 100 blog posts (this is No. 101) detailing the latest information, from changing requirements to expanding programs.

Keep Your Home California also embraced social media when the program launched back in 2011. Keep Your Home California has a Facebook account and Twitter handle, where information on the program and mortgage/real estate-related news are shared. Facebook allows consumers to ask about Keep Your Home California, which has a 100% response rate. Keep Your Home California’s YouTube channel features commercials and interviews about the program.

Finally, real homeowners and their very real stories have been used in commercials – on TV, online and the radio.

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In the never-ending commitment to transparency, Keep Your Home California is encouraging homeowners to apply for the mortgage-assistance program as soon as possible. Keep Your Home California is entering the final stretch and could stop accepting applications within the next several weeks.

In order to apply for the state-managed program, homeowners must have a financial hardship, such as a job loss, cut in pay, divorce, death in the family, or extraordinary medical expenses.  Homeowners must also meet county-by-county income limits. Severe negative equity is considered a financial hardship under the Principal Reduction Program.

Homeowners interested in learning more or applying for the program should call the counseling center at 888-954-KEEP (5337), visit www.KeepYourHomeCalifornia.org, or www.ConservaTuCasaCalifornia.org for Spanish speakers.

The counseling center is open 7 a.m. to 7 p.m. weekdays and 9 a.m. to 3 p.m. Saturdays. Calls can be taken in virtually any language.

 

 


Refinancing the mortgage, selling a home are possible after receiving assistance from Keep Your Home California

California’s economy, jobs and housing markets have improved in recent years, allowing one-time down-on-their-luck homeowners to consider their options – and even look at new opportunities.

Perhaps a better-paying job in another city is calling, or that cozy two-bedroom cottage perfect for two has become cramped for a family of four? Or maybe that one-time crater-filled credit report has become rock-solid, and you’re looking to refinance at a lower interest rate – and save some money every month?

But if you are one of the more than 80,000 homeowners who have received assistance from Keep Your Home California, you may also be concerned that your previous participation in the program will hold you back from some of the options listed above. After all, part of the stipulations in order for you to qualify for Keep Your Home California assistance is that you stay in your home for a specified amount of time.

Keep Your Home California applauds the efforts assistance recipients make to get back on their feet and move forward with their lives. Homeowners who previously qualified for assistance have some options because the state-managed program was always meant to be a helping hand, not handcuffs.

Payoffs and subordinations are possible with Keep Your Home California.

When the economy collapsed and the housing market bubble burst several years ago, qualifying homeowners were in a much different situation. Maybe you endured a cut in pay (or hours), or a job loss? Perhaps you bought at the top of the market and were dealing with an underwater mortgage and an upside-down life for a while? Or perhaps those mounting medical bills caused you to get behind on the mortgage payments?

For the homeowners who weathered the storm, Keep Your Home California recognizes that it may be more advantageous for them to refinance or even sell their home, now that calm seas and clear skies have returned.

Qualified homeowners can refinance their mortgage as long as the new loan meets Keep Your Home California’s “no cash-out” criteria. Basically, you cannot take cash out on the equity that was created or maintained due to the program assistance, until the Keep Your Home California lien has been satisfied and released.

However, if the new loan is to enjoy a lower interest rate and save some money on the payments every month, Keep Your Home California may be able to subordinate its lien in order to help make the homeowner’s refinance possible.

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What if you need or want to sell your home? Maybe you are moving for a new job or the family needs more space? This is a bit more complicated.

If you sell the home for less than you owe, Keep Your Home California may be able to approve a short-sale. Depending on the amount of equity available when the home is sold, Keep Your Home California may forgive all, or some part of, the outstanding amount of assistance owed.  The amount of forgiveness depends on a number of factors, including the amount of assistance received, amount of sale proceeds and when the homeowner received the funding.

Funds returned to Keep Your Home California are then added to the program funds and made available to new qualifying homeowners who need assistance.

Homeowners interested in payoffs, short sales, and subordinations should contact Keep Your Home California. There is a section on the Frequent Questions webpage that includes questions and answers about payoffs and subordinations. We want to make sure homeowners understand their options.

Homeowners should call the counseling center at 888-954-KEEP (5337) or visit www.KeepYourHomeCalifornia.org or www.ConservaTuCasaCalifornia.org for Spanish speakers. The counseling center is open 7 a.m. to 7 p.m. weekdays and 9 a.m. to 3 p.m. Saturdays. Calls can be taken in virtually any language.

Feature photo by Simez78/Shutterstock


Unemployment Mortgage Assistance Program now helps homeowners catch-up on past-due mortgage payments

Losing a job and looking for work is tough. Just ask anyone who has gone through the experience.

Searching for job openings online, sending out resumes – in some cases drafting cover letters – and going to interviews is often more difficult and time-consuming than a full-time gig.

Keep Your Home California continues to expand to make the experience for job-seekers who own homes much easier, more helpful and less stressful. The free mortgage-assistance program provides assistance to out-of-work homeowners so they can focus on the job search and not worry about their monthly mortgage payments.

To more effectively help homeowners, Keep Your Home California recently made some changes to the Unemployment Mortgage Assistance Program. The program now allows homeowners to get as much as 18 months or a total of $54,000 in financial assistance, whichever comes first. The move opens the door to the program for homeowners with mortgage payments of more than $3,000, the previous limit.

For example, jobless homeowners with a $3,600 monthly mortgage payment could get up to 15 months of assistance from the Unemployment Mortgage Assistance. A larger payment over less time, but still not exceeding the $54,000 limit.

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Keep Your Home California has also adopted in recent weeks another major change to the Unemployment Mortgage Assistance Program – the state-managed program can now help homeowners catch-up on past-due mortgage payments, a rather common challenge for many households looking for work.

Another example: An out-of-work homeowner has a monthly mortgage payment of $4,000, but gets behind by three months as he looks for work. Under the new changes, Keep Your Home California will help the homeowner “catch-up” on those past-due payments of $12,000 and cover the monthly payment of $4,000 – again up to a maximum of $54,000. Under this scenario, Keep Your Home California can help the homeowner for as long as 10 months.

Homeowners can qualify for Keep Your Home California’s Unemployment Mortgage Assistance Program if they are eligible for unemployment benefits from the state Employment Development Department – or they have received jobless benefits within the past 60 days.

Even if a homeowner’s EDD benefits have already expired, as long as it was less than 60 days ago, they can still qualify for assistance.

Before homeowners can receive assistance from Keep Your Home California, they must meet the core requirements, including a financial hardship, such as a job loss, cut in pay, divorce, death in the family or extraordinary medical expenses.

They must also meet county-by-county income requirements and their mortgage servicer – the company that collects the monthly payment – needs to participate in Keep Your Home California. A vast majority of mortgage servicers, including Bank of America and Wells Fargo, participate in the federally funded program.

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Keep Your Home California has issued almost $1.9 billion – or about 90% of the funding allocated for the program – to 78,000 households across the state.

Homeowners interested in learning more or applying for the program should call the counseling center at 888-954-KEEP (5337) or visit www.KeepYourHomeCalifornia.org or www.ConservaTuCasaCalifornia.org for Spanish speakers. The counseling center is open 7 a.m. to 7 p.m. weekdays and 9 a.m. to 3 p.m. Saturdays. Calls can be taken in virtually any language through a free translation service.

Feature photo by ChameleonsEye/Shutterstock.


Reverse Mortgage Assistance Pilot Program to stop accepting applications Nov. 30

Keep Your Home California will soon close its Reverse Mortgage Assistance Pilot Program, a program that helps senior homeowners with a reverse mortgage catch-up on past-due property-related expenses, such as property tax or homeowners’ insurance, in order to avoid possible foreclosures.

Applications for the free mortgage-assistance program must be received by 6 p.m. Thursday, November 30, 2017. Homeowners who have a reverse mortgage and are at-risk of foreclosure should contact their reverse mortgage servicer to apply or receive more information about the program. A complete list of reverse mortgage servicers who participate in the program and their contact information can be found on the website at the following link: http://keepyourhomecalifornia.org/reverse-mortgage-assistance-program/.

The reason behind the end of the Reverse Mortgage Assistance Pilot Program is rather simple – the funds allocated for the pilot program will run out by the end of November 2017. The program has helped approximately 700 households and issued more than $9 million in assistance.

Keep Your Home California allocated $10 million for the Reverse Mortgage Assistance Pilot Program. During the next few weeks, between homeowners approved and awaiting funding and applications that are submitted before the deadline, the program will exceed the $10 million limit.

Keep Your Home California launched the Reverse Mortgage Assistance Pilot Program in February 2015 as a way to help senior homeowners with a reverse mortgage dealing with a financial hardship, such as a reduction in household income, extraordinary medical expenses or even the loss of a spouse.

“It saved our lives,” Joanne H. says of the Reverse Mortgage Assistance Pilot Program.

Joanne, who lives in Central California, had to close her business and pursued a reverse mortgage to help pay off bills. But she and her husband got behind on their property-related expenses and faced the possibility of losing their home.

“The weight it took off … you just don’t know. We were going to lose our home,” she said

Low- to moderate-income homeowners can receive as much as $25,000 in assistance under the Reverse Mortgage Assistance Pilot Program. Homeowners must meet county-by-county income limits – from about $84,000 in rural counties to more than $160,000 in the Bay Area.

The mortgage servicer must also participate in the Reverse Mortgage Assistance Pilot Program. Fourteen servicers – including Champion, Financial Freedom, James B. Nutter and Sunwest – participate in the program.

Keep Your Home California’s four first-mortgage programs – Unemployment Mortgage Assistance, Principal Reduction, Mortgage Reinstatement Assistance and Transition Assistance – will continue to accept applications and issue funding after November 30, 2017.

While the Reverse Mortgage Assistance Pilot Program is the first of the five programs to end, Keep Your Home California is entering the final stretch of the program, and homeowners are encouraged to apply as soon as possible for the four remaining programs. Keep Your Home California has assisted more than 77,000 homeowners since February 2011, with about $1.9 billion issued.

Homeowners interested in learning more or applying for Keep Your Home California should call the counseling center at 888-954-KEEP (5337) and visit www.KeepYourHomeCalifornia.org or www.ConservaTuCasaCalifornia.org for Spanish speakers. The counseling center is open 7 a.m. to 7 p.m. weekdays and 9 a.m. to 3 p.m. Saturdays. Calls can be taken in virtually any language.

 


I Fell Behind on My Mortgage: How Will This Hurt My Credit?

Editor’s note: Beth Kotz with Credit.com has provided a special blog to explain the effects mortgage delinquency and loss mitigation have on credit.

By Beth Kotz

As a homeowner, your mortgage and your credit rating are inextricably linked. To make sure you maintain solid credit, the best thing you can do is make your mortgage payments on time each month.

Mortgages have a major impact on your credit rating and even have their own category on a credit report.

So if you’ve hit some financial bumps in the road and are unable to make your next payment, be aware that falling behind does have consequences. While one isolated incident won’t set you back too far, if you’re unable to pay for longer you should know how this will impact your credit and what impact loss mitigation options can have on your rating as well.

Delinquent Mortgage Payments and Your Credit

Mortgage contracts typically include a grace period. If you make a payment just a few days after the due date, it will likely fall within this period. The lender still counts the payment as being on time, so there is no negative effect on your credit. Grace periods are usually 10 to 15 days.

If you miss the due date and the grace period, a mortgage payment will be considered late. According to  Sarah Davies, Sr. VP, Analytics, Product Management and Research with VantageScore, “Becoming 30 days delinquent on a mortgage loan can cause even a high credit quality consumers’ credit score to decline by as many as 100 points.”

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Your lender will report the delinquency to credit reporting agencies. It will appear on your credit report as a “Late 30” note. If you make the payment within 30 days, this note will go away after the next reporting period, and will not cause lasting damage to your credit score.

When mortgage payments are more than 30 days late, however, or when a consumer is repeatedly late making payments, the adverse effects on credit are more serious. Paying your mortgage 90 days late or more will damage your credit score for up to seven years.

If you fall more than 120 days behind on your mortgage, the lender normally considers you in default. You will receive a “Notice of Default” (NOD). A NOD is the first formal action a lender takes in a process leading to foreclosure. Because a NOD is a public document, it will be noted on your credit record and can also cost you in the form of late fees and higher interest rates. However, it is not as damaging as a foreclosure.

When a consumer falls too far behind, the lender can foreclose on the home. If you lose your home to foreclosure, or if you give it back to the lender via a deed in lieu of foreclosure, your credit score will drop by approximately 250 to 280 points. Restoring your credit score to a place where you will be able to secure a new mortgage with a lower interest rate and better terms will take about three years of on-time, consistent payments.

However, foreclosure proceedings typically take months or years and you can still try to work out an arrangement with the lender. If you take the initiative to stay in touch and find an option that will work, most lenders will work with you.

Loss Mitigation and Your Credit

Loss mitigation is a “catch-all” term that refers to any option that will help a homeowner who is behind on a mortgage to get caught up. There are several such options, and they have varying effects on credit.

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If you realize you are faced with a financial problem such as job loss or unexpected medical bills, you can ask your lender for a forbearance. You may need to act immediately as lenders may not grant a forbearance if you are already seriously delinquent on your mortgage. Under a forbearance agreement, you make smaller payments or no payments at all for a period of time. After you resume regular payments, you will also need to make up the payment amount that was skipped during the forbearance. The good news is that a forbearance will not negatively affect your credit.

Another option you may have is a loan modification. Essentially, loan modifications are permanently restructured mortgage contracts. The key feature of a loan modification is that it requires the lender to list the debt as current or paid in full with credit reporting agencies as long as you comply with the loan modification requirements. You should beware loan modifications that don’t present rigorous qualification guidelines as they can actually be debt settlement arrangements – which will hurt your credit.

Loan modifications endorsed by the U.S. government – like the Home Affordable Modification Program (HAMP) – will not impact your credit. If you continue to meet the requirements of the loan modification program, the mortgage will continue to be reported as current and paid in full. Government assistance benefits are not reported to credit bureaus. As such, applying with Keep Your Home California will not affect your credit score.

If you’ve fallen behind on your mortgage, remember that the situation isn’t hopeless. The worst thing you can do is ignore the problem and wait for it to disappear. Be proactive, educate yourself about loss mitigation assistance and contact your lender right away. If you live in California, a great first step is to contact Keep Your Home California to see whether you might qualify for assistance.

Remember, the bank or other mortgage provider does not want your home. Foreclosure is an expensive last resort for the lender. If you take the initiative to keep in touch and do your best to work out an agreement that will bring your account up to date, it will minimize any harm to your credit.

559520_1767301903269_1946830701_n (1)Beth Kotz is a contributing writer to Credit.com. She specializes in covering financial advice for female entrepreneurs, college students and recent graduates. She earned a BA in Communications and Media from DePaul University in Chicago, Illinois, where she continues to live and work.

 


More than 10,000 homeowners helped in 2016

Keep Your Home California recently closed the books on another strong and successful year, assisting more than 10,000 homeowners from Calexico to Crescent City – and just about every community in between.

The federally funded program has become much-appreciated by homeowners, helping them through difficult and stressful chapters of their lives. Many homeowners dealing with hardships – such as a job loss, pay cut, a divorce, a death in the family or even extraordinary medical bills – are helped by the free mortgage-assistance program.

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“The support is a big financial relief,” says homeowner Vinh L., who benefited from the Principal  Reduction Program through Keep Your Home California that saves his family almost $400 per month. “We were in huge financial distress.”

 

And that’s the mission of Keep Your Home California, which has issued more than twice as much funding to homeowners than any other state in the Hardest Hit Fund program.

Even with an improved economy and housing market, there are still many homeowners who need help. For example, there are an estimated 400,000 out-of-work homeowners in the state. About 310,000 California homeowners with a mortgage are considered underwater.

Keep Your Home California is definitely needed and continued to help at an impressive pace in 2016. Homeowners who were helped by the state-managed program received more money, on average, than previous years.

In 2016, Keep Your Home California assisted 10,262 homeowners with a total of $342.2 million in funding, the second best year in terms of the amount of assistance provided to homeowners. Last year’s funding was down slightly compared to 2015, when 11,173 homeowners received a total of $352 million.

The average homeowner received a record $33,346 in 2016, almost $1,850 more than in 2015 – and $8,359 more than 2014. A boost in Principal Reduction program recipients, where homeowners can receive as much as $100,000, accounted for the increase.

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Clearly, there still are many homeowners who need help in the state. Whether it’s catching up on past-due mortgage payments or seeking assistance for an unaffordable or underwater mortgage, Keep Your Home California has a program to help.

The Unemployment Mortgage Assistance Program remains the most utilized, helping 5,699 homeowners in 2016. The average assistance was $26,594 – almost $2,300 more than a year earlier.

The Unemployment Mortgage Assistance Program offers as much as $3,000 per month for up to 18 months – or a total of $54,000 – to help out-of-work homeowners eligible for jobless benefits from the state Employment Development Department. The program allows homeowners to focus on finding a job rather than worry about their mortgage payments for a while.

The Principal Reduction Program is the largest of the five programs based on funding issued — $154.8 million in 2016. The average homeowner approved for principal reduction received about $62,390. The program provides a maximum of $100,000 in mortgage assistance.

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Of course, the now 6-year-old program also has an economic impact on nearby homeowners, the surrounding communities, and even property and sales-tax revenue.

An economic impact report conducted by Dr. Joseph C. Von Nessen, a Research Economist at the University of South Carolina, Darla Moore School of Business, determined that for every $1 issued to help homeowners through Keep Your Home California, $2 of economic activity was preserved within the state’s economy.

Another highlight from the report, found that Keep Your Home California preserved a total of $2.5 billion of economic activity by preserving jobs, tax revenue and property values of nearby homeowners across the state.

A few other highlights from 2016:

  • Keep Your Home California received an additional $383.3 million in funding from the U.S. Department of the Treasury. The dollars will allow Keep Your Home California to help at least another 12,000 homeowners. The program sunset date was also extended to December 31 2020, or until all of the money is issued to homeowners, whichever comes first.
  • Added 30 new mortgage servicers to the program. Almost 270 mortgage servicers – including Bank of America and Wells Fargo – currently participate in the program.
  • Developed six homeowner stories for online and TV commercials in English and Spanish. If you haven’t seen them, they are available on the Keep Your Home California website.

Keep Your Home California has assisted more than 71,000 homeowners with approximately $1.7 billion in funding.

As always, we encourage more low to moderate income homeowners to apply for Keep Your Home California.

In order to apply, homeowners must have a financial hardship, such as a job loss, cut in pay, divorce, death in the family or extraordinary medical expenses.

In addition to the financial hardship, homeowners must meet county-by-county income requirements and their mortgage servicer – the company that collects the monthly payment – needs to participate in Keep Your Home California.

Homeowners interested in learning more or applying for the program should call the counseling center at 888-954-KEEP (5337) or visit www.KeepYourHomeCalifornia.org or www.ConservaTuCasaCalifornia.org for Spanish speakers. The counseling center is open 7 a.m. to 7 p.m. weekdays and 9 a.m. to 3 p.m. Saturdays. Calls can be taken in virtually any language through a free translation service.