Keep Your Home California continues to expand its programs to help low and moderate-income homeowners struggling to pay their mortgages.
The state-run $2 billion mortgage assistance program has changed the requirements for two of its four programs.
Homeowners with a financial hardship — such as a job loss, divorce, cut in pay or medical bills — and an unaffordable mortgage can now apply for help under the Principal Reduction Program.
Before, homeowners had to show that they were underwater on their mortgage. Homeowners who spend more than 38% of their family income on a mortgage are eligible for up to $100,000 to help reduce the principal on the loan.
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The state program also doubled the funding limit under the Mortgage Reinstatement Assistance Program. Homeowners who are at least two months behind on their monthly mortgage can apply for up to $54,000 to catch up on payments. The program limit was previously $25,000.
“Despite an improving economy and job market, there are still many homeowners who are struggling every month or just need a little help to get back on track with their payments,” said Tia Boatman Patterson, executive director of the California Housing Finance Agency which oversees Keep Your Home California. “Our goal is to help California homeowners prevent avoidable foreclosures and the changes to the program are the latest in that effort.”
Homeowners must meet program requirements and their mortgages must be held by financial institutions who participate in the Keep Your Home California program.