CalHFA using $700 million to help homeowners

The California Housing Finance Agency (CalHFA) announced that the U.S. Department of the Treasury has approved the agency’s plan to use nearly $700 million in federal funding to help California families struggling to pay their mortgages.
The plan is focused on assisting moderate income families, as well as military personnel, stay in their homes when possible and leveraging additional contributions from lenders and mortgage servicers.
“California’s twin problems of unemployment and declining real estate values have created a homeownership crisis for many of today’s California families,” said Steven Spears, executive director of CalHFA. “We will use these funds to help as many families as possible remain in their homes and, in so doing, stabilize neighborhoods that have been severely impacted by foreclosures.”
Spears said that the plan includes three mortgage assistance programs as well as a separate program that will provide transition assistance to borrowers who simply cannot afford to stay in their homes after exhausting all other options.
With the Treasury’s approval, CalHFA has already begun establishing the program criteria, processes and infrastructure needed to effectively administer and monitor these programs.
These programs are completely new within the state of California.
“We will move quickly to ensure these programs are implemented in an effective way to help the maximum number of homeowners,” Spears said.
CalHFA developed a set of programs after extensive consultation with community groups, counselors and others involved in helping struggling homeowners.
The following programs have a goal of dollar-for-dollar contributions from participating lenders:
• Mortgage assistance for unemployed homeowners who are in imminent danger of defaulting on their home loans.
• Funds to help borrowers become current on their delinquent mortgages, with lenders matching any federal assistance.
• Principal reductions for eligible borrowers with negative equity to prevent avoidable foreclosures and promote sustainable homeownership.
CalHFA will provide regular updates on the status of this program through a special website which was created for this purpose at www.keep
yourhomecalifornia.com.