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June 22nd, 2011

Mortgage relief for unemployed finally arrives…apply now!

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Job MarketHomeowners in 27 states and Puerto Rico who are at risk of foreclosure may finally be getting some much-needed relief.

The Emergency Homeowners’ Loan Program (EHLP), created through the Dodd-Frank Wall Street reform, is designed to provide an interest-free loan to those struggling to make their monthly payments due to unemployment, underemployment, illness or injury.

EHLP will help these homeowners pay a portion of their monthly mortgage payments for up to two years or provide up to $50,000, whichever comes first. HUD, who is administering the program along with NeighborWorks, expects to reach up to 30,000 distressed homeowners with loan amounts which are expected to average $35,000:

The EHLP program will pay a portion of an approved applicant’s monthly mortgage including missed mortgage payments or past due charges including principal, interest, taxes, insurances, and attorney fees.

The EHLP program is a complement to the Hardest Hit Fund which makes available $7.6 billion to 18 states and the District of Columbia that were hardest hit by the housing crisis. The EHLP program will be offered in the following states: Alaska, Arkansas, Colorado, Hawaii, Iowa, Kansas, Louisiana, Maine, Massachusetts, Minnesota, Missouri, Montana, Nebraska, New Hampshire, New Mexico, New York, North Dakota, Oklahoma, South Dakota, Texas, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin, and Wyoming and Puerto Rico. Five states operating substantially similar programs are administering EHLP directly: Connecticut, Delaware, Idaho, Maryland, and Pennsylvania. With today’s launch, mortgage assistance is now available for unemployed and underemployed homeowners in every state. 

Here’s how to apply

Interested homeowners need to first visit the NeighborWorks website and fill out a Pre-Applicant Screening Worksheet (available on the website).

According to NeighborWorks:

EHLP counseling agencies will evaluate completed screening worksheets to make an initial, informal pre-determination of household eligibility. Homeowners whose completed worksheets meet this standard will be randomly selected, and these homeowners will be invited to apply for an EHLP loan in the order they are selected.

The Pre-Applicant eligibility screening period will run from between June 20, 2011 through July 22, 2011. The homeowner application period will not begin until late July 2011. The Pre-Applicant screening procedures are described below, and include a link to a downloadable and printable screening worksheet. Click here for the contact information of the EHLP housing counseling agency serving your community, county or state.

Homeowners who are randomly selected will be called by their local EHLP housing counseling agency to schedule an appointment to complete the EHLP application packet. NOTE: There is no charge for this service. During the appointment, homeowners will be required to submit the specified documentation to support eligibility. It is very important for all homeowners to be familiar with all of the EHLP documentation requirements and have all specified documents prepared to submit at the time of their application appointment. Click on this link to review the document checklist.

Getting approved won’t be easy

Due to the high demand for the EHLP, HUD and NeighborWorks anticiapte that a good number of borrowers won’t be able to secure an EHLP loan. According to NeighborWorks, “Unfortunately, due to the limited amount of resources available through the EHLP, some qualified homeowners will not be selected to complete an application. Furthermore, some homeowners will complete an application but not will not ultimately be approved to receive assistance if their applications are incomplete or if they do not otherwise meet all of the program’s eligibility criteria.”

At this point, I don’t see why this program will run any more smoothly than any of the other government efforts to provide foreclosure assistance. While we will have to wait and see, you only have one month to apply, so submit your application as soon as possible!

READERS: For those who may apply for this program, we ask that you keep us posted on your progress and let us know how you’re making out. Good luck!

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3 Responses to “Mortgage relief for unemployed finally arrives…apply now!”

  1. Phxfan Says: June 23rd, 2011 at 1:14 pm

    So, then two years later you can be further in debt, AND still have a deeply underwater house…

  2. Reb Says: March 28th, 2012 at 11:24 pm

    I received a letter from the EHLP program back in September 2011 and I’m still waiting for the review process to be completed; meanwhile my house is going into foreclosure and I can’t find a job. Hope help arrives soon or this program will have done me exactly zero good :-(

  3. APPLY BEFORE JULY 22, 2011!! Says: June 21st, 2012 at 2:22 pm

    [...] Mortgage relief for unemployed finally arrives…apply now! (hsh.com) [...]

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HSH.com's daily blog focuses on the latest developments in the mortgage and housing markets. Our mission is to relate how changes in mortgage rates and housing policy, as well as the latest financial news, impacts consumers, homebuyers and industry insiders alike. Our 30-plus years of experience in the mortgage industry gives us an edge as we break down the latest changes in an ever-changing market.

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Tim Manni

Tim Manni is the Managing Editor of HSH.com and the author of their daily blog, which concentrates on the latest developments in the mortgage and housing markets.

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