Do You Qualify for Keep Your Home California?
As part of the Hardest Hit Fund by the US Treasury, California received $2 billion to help homeowners. The funds administered by CalHFA and Keep Your Home California are meant to provide mortgage assistance for unemployed and/or underwater homeowners or transition assistance if a short sale or deed-in-lieu is required. Do you qualify for Keep Your Home California funds? The information below was provided by KYHC to HomeHelpOC during a February 6, 2012 phone conversation. The accuracy of this information has not been verified.
As a general rule, the loan must be owned by Fannie Mae or Freddie Mac and qualify for HAMP (Home Affordable Modification) guidelines.
- You obtained your home on or before January 1, 2009
- You occupy the house as your primary residence
- You have a mortgage payment that is more than 31% of your monthly gross (pre-tax) income
- You owe up to $729,750 on your home
- You have a financial hardship and are either delinquent or in danger of falling behind
- You have sufficient, documented income to support the modified payment
Here is what they don’t tell you:
- If you have an OPTION ARM, there are no available programs because it does not fall under HAMP.
- The $25 Billion settlement that was just reached with the 5 major lenders requires relief only to be given to people that are delinquent on their mortgage
- If you are current on your mortgage, you may be told that you don’t qualify because the loan is current.
- A homeowner cannot be in a trial modification or have applied for it.
- If applying for Keep Your Home California programs, a household income must be less than maximum income limits for the county.
MRAP – Mortgage Reinstatement Assistance Program – A person may qualify for this program where homeowners can receive up to $20,000 to catch up on the mortgage payments if the delinquency was due to a significant change in circumstance on an emergency. The total housing expense must be less than 38% of the gross household income. If a household makes $5000 per month, the maximum expense for all payments including mortgage, insurance, taxes, HOA, and revolving or installment debt reflected on the credit report cannot exceed $1900. Should the debts exceed 38%, the homeowner does not qualify for the MRAP program. If a homeowner or spouse is currently unemployed and receiving unemployment benefits, the income is not used in the debt to income calculations.
UMA – Unemployment Mortgage Assistance – The program provides mortgage assistance up to $3000 per month for unemployed homeowners who are collecting unemployment benefits from the State of California Employment Development Department (EDD). In general, to qualify for this program a homeowner must have a total debt to income greater than 31% of their total gross income. If one spouse is employed and the other is unemployed, and if the income received from the EDD causes the debt to income ratio to be less than 31%, the homeowner does not qualify for the program.
PRP – Principal Reduction Program – This program provides up to $50,000 from KYHC and requires the current participating servicer to contribute a dollar-for-dollar match. The total reduction in principal could be up to $100,000. To qualify, your current mortgage amount must be greater than 120% of the current value of the home. If the property is currently worth $200,000, the loan amount must exceed $240,000 to be eligible. Additionally, the total debt-to-income must be greater than 31%.
If your loan is serviced by Bank Of America, good luck. KYHC does not facilitate or oversee the eligibility of the programs for BofA. KYHC does conduct an initial interview to determine possible eligibility, but homeowners will then be directed to send all items to Bank Of America and their Hardest Hit Fund Department. Once the file is with them and a homeowner tries to follow up, the homeowner is directed back to KYHC to contact the assigned processor. Unfortunately, because KYHC does not have the file there is no one assigned to the file within KYHC. It can be a frustrating circle.
Income and values can be looked at in many different ways. Be sure to contact us first before going through all of the paperwork and initial interviews. We will make sure your income is calculated correctly and the information you provide is accurate.
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