Published Thursday, May 03, 2012
By SARAH FAY CAMPBELL
Georgia has a $340 million program to help those who have lost their jobs pay their mortgages until they can get back on their feet.
Even though the program, HomeSafe Georgia, has been in place for a year, few people know about it — and even fewer have taken advantage of it.
In the program’s first year, $23 million has been spent to help roughly 900 homeowners.
According to the program’s website, www.homesafegeorgia.com , the program’s goal is to provide assistance to more than 18,000 homeowners.
The money comes from the federal government’s “Hardest Hit Fund,” which was created in February 2010 to provide aid to families in states hit hardest by the foreclosure crisis. HomeSafe Georgia is administered by the Georgia Department of Community Affairs.
Because the program hasn’t been well known or well utilized, some changes are in the works.
One of those changes is partnering with the Georgia Department of Labor to hold informational events. Additionally, HomeSafe Georgia recently sent out letters explaining the program to everyone receiving unemployment benefits.
As a pilot program, HomeSafe Georgia will be working with the Three Rivers Regional Commission, a planning region that covers a 10-county area including Coweta. The program was discussed during last week’s Three Rivers meeting, held at the Coweta County Fairgrounds.
“The state has not been as successful as they wanted to be and they’ve asked us to be the first in rolling this out again,” said Lanier Boatwright, Three Rivers’ executive director.
There will be an event on May 12 in Carrollton. It will be held from 9 a.m. to 1 p.m. at the West Central Technical College administration building at 401 Adamson Square in downtown Carrollton.
“I think our main function would be to assist people in filling out applications” at the event, said Boatwright.
The first HomeSafe informational program was held last Saturday, hosted by Congressman Hank Johnson. “We had a really great event,” said Brenda McGee, program manager for HomeSafe Georgia. They hope to work with each congressional district.
One of the complaints lodged against the program is the application process. Applications must be filled out online — they are then printed on paper and mailed or faxed to HomeSafe Georgia.
Applicants must have an e-mail address, and most correspondence regarding the program is done through e-mail.
Several changes have been approved and went into effect on May 1.
Though the online application is the official route, the program has always mailed out applications to people who have trouble with the online one, McGee said.
But now, they are going to set up a system whereby potential applicants can make an appointment to come in and talk to someone and fill out their application. Staff members can also fill out applications while talking to applicants on the phone.
The program has very specific parameters. Applicants must be experiencing problems paying their mortgage that are related to the loss of a job or underemployment. The job loss must be “of a type eligible for unemployment benefits” — that is, not the fault of the person who lost the job. Those who are self-employed must be able to document a significant reduction in income.
Or an applicant who is now employed and can make payments can get help with delinquent payments related to the past loss of a job.
Applicants must have been current on their mortgage before the job or income loss, and they can be no more than six months behind on their mortgages.
The mortgage payment must be more than 25 percent of gross monthly household income. Before May 1, it was 31 percent. Assistance is not available for homeowners whose home is secured by more than $417,000 in loans.
There are new parameters to define underemployment or income reduction for self-employed Georgians. Underemployment is now defined as a reduction in income of 25 percent or more. Self-employed Georgians must demonstrate a 30 percent reduction in gross receipts.
Applicants can’t have more than $5,000 in liquid assets, an active bankruptcy, or state or IRS tax lien, and must be legal residents of Georgia.
Lastly, your mortgage lender/ servicer needs to participate in the program.
If your mortgage lender is not a current participant, don’t lose heart.
“For the most part, all of the larger lenders are participating,” said Kim Higgins, vice president and compliance officer with The Bank of Georgia.
“The program encourages people whose lender is not participating to go ahead and apply and they will contact the lender and try to get them to agree to participate,” Higgins said.
The mortgage assistance comes in the form of a forgivable loan with a zero percent interest rate. The loan is forgiven at 20 percent per year, so as long as the home is not sold within five years, the loan is completely forgiven. If the house is sold before then, the lien must be satisfied at closing.
Depending on income levels, an applicant may be required to make partial mortgage payments. As of May 1, partial payment will be 5 percent of gross household income. Veterans and active duty military will not be required to make partial payments.
The assistance can run for 18 months.
Reinstatement assistance, which helps those currently employed catch up on delinquencies, is a one-time payment of up to six months of mortgage payments and lender fees.
Higgins said she qualified her bank as a participating lender last summer, but, as of yet, they haven’t had any clients apply for the program. That’s not particularly unusual, however, because the bank sells most mortgage loans on the secondary market.
But sometimes people come in looking for some assistance in paying their mortgage, including refinancing or an additional loan, Higgins said.
“We’ve educated all of our lenders to make them aware” of the program, Higgins said.
Becoming a participating lender was easy. “All we had to do was fill out a form designating who the contact person at the bank would be” as well as designating an account for the payments to come to, she said. They also had to agree not to discriminate among borrowers.
Boatwright said he expects Three Rivers staff to spend a good bit of time assisting with the program.
He’s hoping to have members of his staff spend time weekly at the four Georgia Department of Labor offices in the region to help people apply for the program.
State representatives will be training Three Rivers staff members next week, Boatwright said.
“It’s going to be a pretty good effort this time to make it a success,” Boatwright said. “We’re going to be doing this for months and months.”
He thinks the online application and requirements for so much of the process to be done through the Internet may be the sticking point.
“It probably takes a good 45 minutes to fill out the application,” he said. And places like libraries with public computers may not want people to use computers for that long of a stretch, Boatwright said.
“Probably when you lost your job, one of the first things to do is get rid of some of the things you consider luxuries — which would be the Internet,” Boatwright said.
For more information about HomeSafe Georgia, visit www.homesafegeorgia.com or call 770-806-2100 or 404-679-5291.