Various homeowner assistance programs have been made available in order to either address affordability issues or difficulties related to unemployment for homeowners who may be currently looking for a job and are having trouble making their monthly mortgage payment, and one area where homeowners have begun benefiting is through programs offering zero interest unemployment home loan assistance in order to prevent foreclosures.
Programs that offer these types of loans at 0% interest in order to help unemployed homeowners make their home loan payment are usually found through either the Hardest Hit Fund in various states, as these loans may be offered from specific state housing agencies, but there may also be options for homeowners to acquire these types of loans through the Department of Housing and Urban Development’s Emergency Homeowner Loan Program, which is set to begin sometime in early 2011.
While there are mixed feelings about these loans, there are homeowners who do stand to benefit from these 0% loan opportunities as funds from these loans can be paid directly to a mortgage servicer for a set period of time while a homeowner continues to search for an employment opportunity that may either allow them to continue making their monthly mortgage payment or at least qualify for a home loan modification program.
The specifics of these loans may vary from program to program or from one state housing agency to another, but typically they will allow homeowners to borrow up to a set amount at 0% interest and, provided homeowners meet certain criteria and remain in their home for a specific period of time, the balance of this loan can be forgiven. As an example, North Carolina’s unemployment home loan assistance plan through the HHF allows homeowners to be forgiven of their 0% interest loan if they remain in their home for 10 years.
While there are obviously those who feel that these types of assistance programs do have various negative aspects, there is also the fact that homeowners who are unemployed can avoid the loss of their home through essentially what is a forbearance on their home loan payment with assistance from these types of unemployed homeowner loans. There are some who feel that offering these loans to unemployed homeowners may simply be delaying the inevitable and, from a fiscal standpoint, is a poor investment in the housing market, but homeowners who have been suffering from unemployment and fear the loss of their home to foreclosure will obviously greatly benefit from these opportunities in areas where these types of loans may be offered.