Mortgage assistance options for homeowners who are unemployed have been offered in a variety of programs as some have been able to take advantage of forbearance opportunities, while others through the Hardest Hit Fund, have had the opportunity to either find forbearance, loans specifically for unemployed homeowners, or grant-like options from various state housing agencies which can assist homeowners with monthly mortgage payments for a set period of time.
Obviously, unemployment remains one of the most burdensome hindrances which homeowners face when it comes to making their home loan payment and, it has also been one of the driving factors behind the majority of difficulties in the housing market. Yet, home loan modifications were first introduced as a way to potentially assist homeowners with the option of finding a more affordable monthly mortgage payment despite being unemployed. In the past, these homeowners paid their mortgage modification payment through unemployment benefits, but since these benefits are short-term income sources, many homeowners began to miss payments and face mortgage troubles again.
Once the problem was realized, the Making Home Affordable Program instituted a forbearance option on home loans through the Home Affordable Unemployment Program and state-specific unemployment assistance plans soon followed thanks to funds from the Hardest Hit Program. While unemployment remains high, it’s hoped that these unemployment assistance options will continue to benefit homeowners through the early part of 2011 and provide enough assistance so that homeowners who are seeking a job can get back on their feet and either resume making mortgage payments or qualify for mortgage assistance.
While forbearance opportunities from the Home Affordable Unemployment Program is one of the more well-known forms of unemployment assistance available to homeowners, state-specific plans like loans and grants may be less known as there are some states which have not received Hardest Hit assistance or have yet to implement these programs.
Yet, states like North Carolina have programs that offer loans at 0% interest of $24,000 to homeowners, or $36,000 to homeowners who are in a particularly hard hit area, which will be paid out over 24 or 36 months to assist unemployed individuals with mortgage payments and other expenses. In this particular case, this loan is also forgiven if a homeowner remains in their home for ten years and doesn’t sell or refinance their home in the first five years.
There are also programs, which many are viewing to be grant-like options for homeowners from various state housing agencies that offer a mortgage payment subsidy which can help unemployed homeowners for a set period of time. Typically, these subsidies will vary in size depending on the state housing agency and may set a cap on the amount a homeowner may be granted, but in hard-hit areas, this may be enough to at least meet the entirety of an unemployed homeowner’s mortgage payment.
While these plans for unemployed homeowners may vary, homeowners can still contact their mortgage servicer to inquire about home loan forbearance options for unemployed homeowners or they may be able to find out more about Hardest Hit Programs from either their servicer or their state’s housing agency. While it has been difficult for many individuals to find employment, it’s hoped that in the coming months, more unemployed homeowners will be able to avoid foreclosure through these options while they continue to seek an employment opportunity that can provide them the income that will either allow them to resume making traditional mortgage payments or at least qualify for a form of foreclosure prevention, like a home loan modification.