Program Aims to Help Jobless Homeowners Avoid Foreclosure
Some homeowners facing foreclosure will soon have another option. A new program will help unemployed homeowners stay in their homes. A mortgage broker tells Fox 32 this is the first time the unemployed will have help to refinance their mortgages. Gov. Granholm says more than 17-thousand Michigan households will benefit from the “Hardest-Hit Fund”. Michigan is the first of five states hit hard by the recession that will get the money. Thousands of homes across Michigan are in danger of foreclosure. Now, more than 150-million federal dollars will help homeowners work with their lenders so they can keep their home. The Michigan State Housing Development Authority (MSHDA) program will help those who have fallen behind on their payments because of a medical emergency, job loss or reduced income. “People who are very well off and have the higher income brackets are still going through real tough times,” Candice Vickery, Cadillac Mortgage broker, said. “This should help them, even though they live in expensive homes and drive expensive cars, their bills are also higher. Vickery says this is a first to have mortgage help available for the unemployed, and allowing unemployed homeowners some relief could spur a turn-around at a time when real estate values have plummeted. “I think that it will definitely help us in our market, because if people can stay in their homes it's going to keep market values up and not keep bringing them down,” she said. Vickery says strategic foreclosures have contributed to the high foreclosure rates. “Where people who actually can pay and decide not to, because they figure, you know, the home's worth a lot less than what they owe. For them, financially, it's to their advantage to walk away.” But one of Cadillac Mortgage's lenders, Fannie Mae, is not walking away. The company announced Wednesday tougher penalties for strategic foreclosures. Vickery says those penalties and the MSHDA program combined will help curb foreclosures. “If it is successful, will definitely make a difference,” she said. Michigan is using the money to hire people to help homeowners apply for the program. People can apply right now, but MSHDA will not process the applications until July 12th. Fox 32's Jodi Hathaway and photojournalist Corey Petee have the story.