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Illinois Governor Announces the Availability of $345 Million in Foreclosure Rescue Funds

Sep 16, 2011

Illinois Gov. Pat Quinn has announced a program to help approximately 15,000 Illinois homeowners threatened by foreclosure, the Illinois Hardest Hit program, which will utilize $345 million in federal funds to support working families having trouble making mortgage payments due to unemployment or underemployment. The program allows eligible participants to receive up to $25,000 over 18 months as a 10-year loan to keep mortgages current and make ongoing payments, including fees and penalties. The loan is forgiven over the last five years of the 10-year term, and carries zero interest. Funds for the program are supplied by the U.S. Department of the Treasury. Illinois is among 18 states and Washington, D.C. that received funding for the program earlier this year. The Illinois Hardest Hit program will be administered by the Illinois Housing Development Authority (IHDA). “The economic downturn has left too many Illinois families at risk of losing their homes,” said Illinois Gov. Quinn. “Everyone suffers when a home goes into foreclosure. The Illinois Hardest Hit program will help keep families in their homes, help them regain economic stability and keep our communities strong.” Applications for the program are available online through IHDA’s Illinois Hardest Hit Web site. Applicants will be matched with a local review agency that will answer questions, pre-screen applicants for eligibility and assist homeowners in preparing the application and assembling the required supporting documentation. “The best way to stabilize our neighborhoods is to prevent foreclosures before they happen,” said Mary Kenney, IHDA executive director. “This program will make a difference in people’s lives and in our communities.” Eligibility criteria for the Illinois Hardest Hit program include: ►Property must be located in Illinois; ►Household must have a documented income reduction of at least 25 percent due to unemployment or underemployment through no fault of their own; ►Household income must be at or below 120 percent of the area median income; ►Principal loan balance of a mortgage must not be more than $500,000; ►Household liquid assets cannot exceed three months of mortgage payments; ►Property, which can be a one- to four-unit building, must be the primary and only residence of all borrowers/owners; ►Homeowners must carry a fixed-rate mortgage (FRM) or an adjustable-rate mortgage (ARM); negative amortization or interest-only loans are not eligible; ►The delinquency and forward payments must fall within available assistance and program guidelines; and  ►Applicants must not have been convicted of a mortgage-related felony in the last 10 years. "The Hardest Hit Fund provides Illinois and other states that were hit hardest in the housing market downturn the funds to implement local programs to assist struggling homeowners," said Treasury Assistant Secretary for Financial Stability Tim Massad. "With these funds, Illinois can provide critical support to homeowners impacted by unemployment so they can remain in their homes and avoid foreclosure."
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