Business

Foreclosure loans delayed until 2011

Applications won't be available till next year for federal loans of up to $50,000 for some homeowners facing foreclosure.

Washington is one of 32 states that will receive money from the Department of Housing and Urban Development’s Emergency Homeowners Loan Program. It will provide assistance for up to 24 months to homeowners who are at risk of foreclosure after losing a chunk of their income because of layoffs, wage cuts or a medical condition.

Regional HUD spokesman Leland Jones said Tuesday that the agency is still trying to determine who will administer the program, which will bring $56,272,599 to the state for zero-interest loans.

The agency had hoped to have the applications ready by this month.

Keep an eye on HUD’s website for a notice about the applications.

Here’s what you need to know about the loans:

Eligible homeowners will receive a forgivable, deferred payment “bridge loan” for up to $50,000 to help with their mortgage arrears and payments on their mortgage principal, interest, mortgage insurance premiums, taxes and insurance.

To qualify:

Borrowers must be at least three months delinquent in their payments and have a reasonable likelihood of being able to resume repayment of their mortgage and related housing expenses within two years.

The property must be the principal residence of the borrower, and eligible borrowers cannot own a second home.

Borrowers must have suffered at least a 15 percent reduction in income and have been able to afford their mortgage payments before the event that triggered the income loss.

  Comments