Owners with Non-Traditional Mortgages Get Federal Aid too
$10 billion worth of federal aid can be used by homeowners with all types of mortgages, including mobile home loans and even seniors with reverse mortgages.
WASHINGTON – U.S. Treasury Department-issued guidance for the new Homeowner Assistance Fund allows states to apportion some of the almost $10 billion in federal funding to help struggling homeowners who purchased their residences with non-traditional home loans – not just conventional mortgages.
The aid money can legally go to eligible residents facing foreclosure on a mobile-home loan or a home obtained through a contract for deed. Certain seniors who have taken out a reverse mortgage on their homes may also qualify.
These non-conventional borrowers are often the ones who need help most – the most vulnerable because lenders can easily foreclose on their homes or evict them if they miss a few payments. This group also tends to pay above-normal interest rates on the loans they take out to purchase their residences.
The $10 billion set aside for the Homeowner Assistance Fund was included in the American Rescue Plan, the $1.9 trillion measure implemented by Congress and the Biden administration to help keep Americans “experiencing hardships associated with the pandemic” in their homes. The funding is going to states, Native American tribes and U.S. territories.
The Homeowner Assistance Fund is separate from the $47 billion that the federal government is providing states to supply rental assistance to tenants facing eviction, though both were part of the American Rescue Plan.
Source: New York Times (08/02/21) Goldstein, Matthew
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