Keep Your Home California State-Run, Federally-Funded Foreclosure Prevention Programs Mortgage Assistance for California Homeowners Webinar October 27, 2015
About Keep Your Home California California s Hardest Hit Fund program Federally-funded (US Treasury), state-managed (CalHFA) Fully implemented in February 2011 Goal is to help prevent avoidable foreclosures for eligible low and moderate income homeowners Qualifying homeowners can receive up to $100,000 in mortgage payment assistance in total Five unique programs, all designed to address different aspects of the foreclosure crisis Services are provided free of charge 2
General Homeowner Eligibility Requirements Meet low and moderate income limits Complete and sign a Hardship Affidavit must be able to document the reason for hardship Mortgage loan is delinquent or in imminent default Adequate income to sustain mortgage payments after assistance and/or modification is provided, according to program and/or participating servicer guidelines Cannot be in active bankruptcy Servicer participation is required for homeowners to access benefits 3
General Property Eligibility Requirements Property must be located in California Property must be owner occupied, primary residence Assistance only available for the first mortgage No Home Equity Lines of Credit or mobile homes that are not real property Current unpaid principal balance of first mortgage cannot exceed $729,750 Reverse Mortgage Assistance Pilot Program limit is $625,500 Property cannot be abandoned, vacant or condemned 4
Five Programs Principal Reduction Program $100,000 to reduce the outstanding principal balance Unemployment Mortgage Assistance $3,000 per month, for up to eighteen (18) months Mortgage Reinstatement Assistance Program $54,000 to catch-up past due mortgages Transition Assistance Program $5,000 to help with relocation expenses Reverse Mortgage Assistance Pilot Program $25,000 to reinstate past-due property expenses Homeowners can receive assistance from more than one program, but the maximum combined assistance cannot exceed $100,000 per household 5
Principal Reduction Program Assists homeowners who owe more than their home is worth and/or have an unaffordable mortgage payment per program guidelines Benefit assistance up to $100,000 per household Can be used to help homeowners achieve an affordable mortgage payment even if the assistance provided leaves the homeowner with positive equity Loan-to-value ratio must be below 140% after assistance is provided Debt-to-income ratio cannot be below 25% after assistance is provided Loan-to-value ratio greater than 120% qualifies as a hardship indicative of imminent default 6
Unemployment Mortgage Assistance Helps eligible homeowners who have experienced involuntary job loss and who are receiving California EDD unemployment benefits or have received California EDD unemployment benefits within prior 30 days Benefit assistance up to $54,000 per household Provides temporary benefit assistance in the form of a mortgage payment subsidy for maximum of 18 months Monthly benefit up to $3,000 or 100% of the first lien mortgage loan PITIA, whichever is less Not eligible if a Notice of Default was filed more than 60 days ago 7
Mortgage Reinstatement Assistance Assists eligible homeowners by providing reinstatement assistance to catch-up on the past-due amount of their first lien mortgage loan Benefit assistance up to $54,000 per household Participation is limited to a one-time payment Homeowner must be at least two payments behind at time of application Homeowner must be able to demonstrate that payment is affordable, per guidelines Can follow UMA if homeowner emerges from unemployment hardship but still needs help to pay loan current 8
Transition Assistance Program Provides transition assistance benefits to homeowners who can no longer afford their home and avoid foreclosure by agreeing to a short sale or deed-in-lieu of foreclosure Benefit assistance up to $5,000 per household Helps homeowners make a smooth transition to alternative housing Benefit assistance provided directly to homeowners Homeowners who received HAFA funds or assistance from a proprietary program of $5,000 or more are ineligible 9
Reverse Mortgage Assistance Pilot Program Provides assistance to qualifying senior homeowners who are in danger of losing their home due to their property expense arrearages associated with their FHA Home Equity Conversion Mortgage (HECM) loan Benefit assistance up to $25,000 per household Reinstates property taxes, homeowner s insurance, and other approved property-related expenses Provides an advance of approved property expenses for up to an additional twelve (12) months to enable the homeowner to recover from their hardship Application process must begin with the servicer 10
Program Changes Several program changes since inception Recently approved 17 th amendment to term sheets Changes are a result of analyzing data collected at the call center and direct feedback from partners, servicers, applicants, and others Examples include eliminating restrictions such as cashout, second property, origination date, etc. Servicer participation has grown dramatically 9 servicers participating at launch; over 240 today Represents 95% of the mortgages in California 11
Recent Program Changes December 2014 Expanded Unemployment Mortgage Assistance to 18 months February 2015 Launched the Reverse Mortgage Assistance Pilot Program March 2015 Increased the benefit cap for Mortgage Reinstatement Assistance to $54,000 April 2015 Implemented the Affordability utility of the Principal Reduction Program 12
How to Apply Call the Keep Your Home California Counseling and Processing Center at 888-954-KEEP (5337) Hours: Mon Fri 7am 7pm; Sat 9am 3pm; Closed Sun Translation service is available so calls can be taken in virtually any language Contact one of the HUD approved housing counseling agencies certified to conduct Keep Your Home California counseling sessions. 13
Application Process Counseling sessions typically take 30-45 minutes to complete (varies by program) All homeowners listed on the mortgage must apply At the end of the counseling session, a comprehensive packet explaining next steps and the required documentation is sent to the homeowner Homeowners must return all required documents Once documents are received, Keep Your Home California will work with the homeowner s servicer and will make the final determination on approval to fund Median processing time is 48 days (program to date through Q2 2015)
Items Homeowner Should Have Available When They Apply Paper and something to write with for notes Mortgage loan number Recent wage or income information Current monthly expenses Explanation of hardship
Results 57,000 households have received assistance $1.16 billion in funding provided Additional $106 million scheduled for disbursement Assistance has been provided to homeowners in all 58 counties of California 93% of homeowners still own their homes 24 months after receiving assistance 98% still own after 12 months and 99% still own after 6 months 16
Recent Results More than $33 million provided per month for the last twelve (12) months Amount has increased to average over $36 million per month in the last six (6) months Three highest months on record were May, June, and July 2015 (over $38 million each month) Principal Reduction Program accounts for 50% of the current transaction pipeline 17
Keep Your Home California s Future California is on track to fully utilize all of its funds before the December 31, 2017 deadline (Hardest Hit Fund sunset date) Current pace would have program funds exhausted by the second quarter of 2017 Anticipate providing assistance to an additional 25,000 struggling homeowners 18
Ongoing Need Economic recovery has been uneven across California and affordability remains an issue About 1 of 9 homeowners with a mortgage in California owe more than their home is worth State unemployment rate remains higher than the national average 1.2 million residents are unemployed Some regions of California are still among the hardest-hit areas in the nation 19
Conclusion Many homeowners across the state are in need of assistance and are likely candidates for Keep Your Home California Important to continue raising awareness about the programs We need your help! Marketing materials are available on the website Time and funding are running out 20
Resources Available on the Website Participating Servicers lists all servicers and shows their participation level by program Eligibility Calculator answer 12 Yes or No questions to see which programs may be an option for you Household Income Limits varies by county Calendar of Events list of upcoming foreclosure prevention events throughout California Success Stories homeowners who received assistance Reports and Statistics interactive map of CA (shows assistance by county), charts and graphs, and all quarterly reports provided to US Treasury Frequently Asked Questions News and Media videos, press releases, news stories, blogs and other updates
For more information, please visit www.keepyourhomecalifornia.org Or call 888-954-KEEP (5337) Follow us on: Thank You! 22