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Join us Wednesday, September 15 from 2:00 p.m. - 4:00 p.m. EDT (11 a.m. - 1 p.m. PDT) to learn more about HEMAP, an emergency mortgage assistance program from Pennsylvania about to be launched nation-wide. Larry Swanson, Executive Director of ACTION-Housing and Mark Schwartz, Executive Director of Regional Housing Legal Services, will join us to talk about the program, its successes and its imminent expansion. 

  • Hear about the program: The two-part event begins at 2:00 p.m. EDT (11:00 a.m. PDT) with a 30-minute conference call in which Larry Swanson and Mark Schwartz will talk about HEMAP. The call-in number is (712) 432-1001 and the access code is 452746624 #.
  • Interact with practitioners: Immediately following the call, from 2:30 - 4:00 p.m. EDT, Larry and Mark will be online to answer your questions. All questions for them should be posted to this thread, and you are welcome to post at any time leading up to or during the event. Questions will be answered on a first-come, first-served basis until time runs out, so post early to be sure yours is addressed.

    About the Program
  • Pennsylvania launched its Homeowners' Emergency Mortgage Assistance Program (HEMAP) in 1983 to provide substantial assistance and a sustainable repayment plan to help families that were at least 60 days delinquent on their mortgage overcome a temporary financial problem. The Financial Reform bill passed earlier this year authorized funding for a program modeled on HEMAP that will provide assistance nationwide.

More information on Pennsylvania's original HEMAP can be found in the attached PowerPoint, as well as on Foreclosure-Response.org and the PHFA website.

Thank you to everyone who was able to join us this afternoon.  If you missed it, an audio recording of the call is available.

Tags: LATF, foreclosure, response

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Where's the information on the national program....hopefully without having to read the massive Financial Reform bill
Thanks
Some basic information on the national program is in this summary of foreclosure provisions in the Wall Street Reform bill: http://www.nhc.org/media/files/Summary_of_Foreclosure_Programs.pdf

Look for "Emergency Mortgage Relief Program" on the bottom of page 1 and top of page 2.
Its on the HUD website but if you send your email to Lswanson@actionhousing.org or mschwartz@rhls.org we can send you a synopsis of the program to date
With regard to payment history prior to the event causing default, does this require 100% non-delinquent payments or is there some room on this. For example, would a homeowner who has had 1 60 day delinquency in the year prior to the event be eligible?
Its more flexible than that. The PHFA looks at the history of the borrower over time...and obviously the longer term record is easier to judge than a shorter term loan.

The underwriting question is really did the borrower make the payments when they had the income to make the payments.
From what I understand this provides an upfront sum to cure arrearages. I am assuming that money goes to the lender and not the homeowner. For the payments that are due while the homeowner is still unemployed, is that assistance ongoing with a monthly check going to the lender? Does the process include the requirement that the homeowner has to pay a portion (determined by counselor, I guess) of the monthly PITI, and the ongoing assistance provides the rest?
Yes ....payments for arrearges go to the lender. There is a closing where all claims are satisfied and the original loan is reinstated...either in its orginal form or in a modified form.

The ongoing assistance is calculated on 30% PITI and the agency sends payments to the lender directly and also is notified by the lender of any borrower non payment.

No funds are disbursed to the borrower directly from the HEMAP loan.
Larry, thanks so much for all of the great information on HEMAP! I'm sorry we ran out of time on the call. Can you tell us more about the servicer/lender engagement portion that you were getting to toward the end? How important is their participation in getting this program to work?
The servicer/lender arragements engagement varies a bit by the experience and training of the housing counseling agency staff. There are 43 agencies in Pa...and some have staff that have been in place and done this work for a time. These agencies engage the lender/servicer for information, modification, etc.

The state agency from time to time also engages the lender/servicer to waive fees, penalities and participate in modifications...but that is driven by their staff time and the cases.

The reference to how it has changed over 27 years of experience is that there are fewer local lender/servicers who are likely to agree to modifications based upon longstanding relationships. My staff has been able to work with most of the larger scale lender/servicers but that work is based upon building relationships with individual account reps and tends to vary over time.

It is additionally complicated by the dramatically increased volume and the technical issues of loans that lender/servicers can not modify.
You mentioned that applying for HEMAP gives an automatic stay to the foreclosure. For how long?
ACT 91 in Pennsylvania provides for an automatic stay of foreclosure if a borrower files an application with a State designated housing counseling agency within 30 days of receiving what is in fact a notice of intent to foreclose from the lender.

The automatic stay is in place until the State Agency...PHFA ....makes a decision on the approval or disapproval of the loan. That typically will take 60-90 days but can take longer. There is an appeal process in the PHFA decision for those denied and that can extend the moratorium.

The statistics are somewhat misleading on the approval rate since we do get a number of applicants who file applications with the knowledge that they have very little chance of approval but use the time to make alternative arrangements. Those arrangements include assistance from family and other sources. It also includes a decision to opt for a deed in lieu of foreclosure, etc.

since there is no income limit on those who apply we have had some higher income applicants who use the stay process to reorganize financially. The State has numbers on what percentage are low-mod- middle income homeowners and its very high.
Were HEMAP representatives involved in the federal conversations about including an emergency mortgage relief program in the financial reform bill? Will the national program’s restrictions on eligibility affect its impact?

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