I reported in October that Washington was one of 32 states that will receive federal funds to provide up to $50,000 in so-called bridge loans for homeowners who are facing foreclosure because of a loss in income.
Many of you have called to find out when the applications will be available. I’ve tried to return all phone calls and e-mails, but if I’ve missed you, I apologize.
It looks like the applications won’t be ready until January, despite what the Department of Housing and Urban Development, which will issue the loans, has tried to do.
Regional HUD spokesman Leland Jones told me this morning that the agency is still trying to decide who will administer the program, which will bring $56,272,599 to the state for zero-interest loans.
Jones said the program will be run either by the state Housing Finance Commission or NeighborWorks, a national network of affordable housing agencies. Four groups in Washington are affiliated with NeighborWorks. Find that list here.
The agency had hoped to have the applications ready by this month.
HUD generally doesn’t loan money directly, but with this program, it will. So officials must ensure the right administrator is chosen, Lee said.
“It’s like going from the stand-up end of the pool to the deep end. We’re wanting to be very cautious,” he said.
Keep an eye on HUD’s website for a notice about the applications. Here’s what you need to know about the loans:
The Emergency Homeowners Loan Program will provide assistance for up to 24 months to homeowners who are at risk of foreclosure after losing a chunk of their income because of layoffs, wage cuts or a medical condition.
Eligible homeowners will receive a forgivable, deferred payment “bridge loan” for up to $50,000 to help with their mortgage arrears and payments on their mortgage principal, interest, mortgage insurance premiums, taxes and hazard insurance.
When the borrower exits the program in good standing, Jones has said, he or she can have the bridge loan forgiven by staying in good standing with the mortgage lender for five years.
• Borrowers must be at least three months delinquent in their payments and have a reasonable likelihood of being able to resume repayment of their mortgage and related housing expenses within two years.
• The property must be the principal residence of the borrower, and eligible borrowers cannot own a second home.
• Borrowers must have suffered at least a 15 percent reduction in income and have been able to afford their mortgage payments before the event that triggered the income loss.