Posted on Thursday, June 30, 2011
The California Housing Finance Agency said Wednesday that 20 mortgage servicing companies are now participating in the state’s Keep Your Home California program to assist families struggling to remain in their homes and avoid foreclosure.
The $2 billion program is funded with federal dollars allotted through the U.S. Treasury’s Hardest-Hit Fund initiative, which provides money to states where home prices have experienced the steepest drops or unemployment rates have risen above the national average.
The number of servicers participating in the California program has grown to 20 from the initial eight that were signed on when it was implemented in February. These 20 banks service about 80 percent of the mortgages held by California homeowners.
“Increasing the number of participating servicers is critical because we need their partnership to assist families in California,” said Claudia Cappio, executive director of the California Housing Finance Agency (CalHFA).
The 20 servicers include six of the largest servicing companies in California: Bank of America; J.P. Morgan Chase; Wells Fargo; GMAC; CitiMortgage, and EMC Mortgage.
In addition to CaLHFA, which services loans it’s extended to low- and moderate-income borrowers, other participating servicers include: Bayview Loan Servicing, California Department of Veterans Affairs, Chase Home Finance LLC, Community Trust, Everbank/Everhome Mortgage, Fidelity Bank, Flagstar Bank, Guild Mortgage, James B. Nutter & Company, Midland Mortgage Company, Navy Federal Credit Union, Saxon Mortgage Servicing, Statebridge, and Vericrest.
“We are pleased that more mortgage servicing companies are joining our effort to assist homeowners who are struggling to pay their mortgages,” said Diane Richardson, the program director. “Keeping families in their homes not only helps those families, but helps to stabilize neighborhoods throughout the state.”
Each of the 20 servicers participates in at least one of the state program’s initiatives, with seven taking part in all four offerings.
One initiative provides mortgage assistance of up to $3,000 per month for homeowners who are collecting unemployment benefits and are in imminent danger of defaulting on their home loans.
A second offers monetary assistance to help homeowners who have fallen behind on their mortgage payments due to a temporary change in a household circumstance. It provides up to $15,000 per household to reinstate mortgages to prevent foreclosures.
Another puts forth money to reduce the principal owed on a mortgage for a home where the homeowner is facing a serious financial hardship and owes significantly more than the home is worth. This program requires lenders to match any assistance provided by Keep Your Home California. Six firms are participating in this effort, the largest of which are GMAC and Saxon.
A fourth initiative provides financial assistance to families who have decided that they can no longer afford to own a home and need to transition to other housing arrangements. This transition assistance is used in conjunction with a short sale or deed-in-lieu of foreclosure.
These initiatives are limited to homeowners who meet a number of criteria, including owning and occupying the home as their primary residence, meeting income limits, and facing a documented financial hardship. Each of the mortgage assistance programs requires the participation of the borrower’s mortgage servicer.
The full list of servicers taking part and the individual initiatives they support can be accessed online.
In total, the Keep Your Home California Web site and the Spanish site, Conserva Tu Casa California, have been visited nearly 170,000 times and nearly 5,000 California homeowners have already received funding or are in process of receiving help through one of the program initiatives.
By Carrie Bay, DS News