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Feds bolster program that helps at-risk homeowners

Fla. Hardest Hit assistance
To apply for mortgage-payment funding in Florida, visit the Florida Hardest-Hit website.

WASHINGTON – Feb. 23, 2016 – The U.S. Department of the Treasury announced on Friday that it will authorize up to $2 billion in additional Troubled Asset Relief Program (TARP) aid to the Hardest Hit Fund, an initiative created in 2010 to provide funding to areas of the country that suffered the most damage during the Financial Crisis and housing market downturn.
The federal government’s additional investment in the program will continue to enable state Housing Finance Agencies (HFAs) to assist struggling homeowners in stabilizing neighborhoods in a large number of the nation’s hardest hit communities, the Treasury Department said in a statement.
The program’s fifth round of funding since its inception seven years ago, will take part in two phases. During the first stage, the Treasury Department used a formula based on state population and an HFA’s effectiveness in deploying available funding in the prior rounds, to allocate $1 billion to 17 states and the District of Columbia.
In order to qualify for the first phase, state-run HFAs were required to have spent at least 50 percent of their existing HHF aid. Alabama, for instance, was declared ineligible after only spending 29 percent of its existing allocations, the Treasury Department said.
By the end of the third quarter of 2015, the Hardest Hit Fund disbursed approximately $4.5 billion of the $7.6 billion on behalf of homeowners and stabilization efforts, according to the Treasury Department. It represents a sharp contrast in comparison with the first two years of the program when only 3 percent of the available funding had been used, according to a government report.
The top five HFAs, led by California, will receive more than $580 million in funding during Phase I. Illinois and Ohio, ranked second and third respectively, will each be granted more than $95 million.
North Carolina and Florida, which round out the top five, will each receive more than $75 million. California, where more than 155,000 families lost their homes due to foreclosures during the Financial Crisis, will be allocated $213.489 million during the first phase. The second phase will be available to all participating HFAs.
“Today’s announcement is the next step in the Administration’s effort to help struggling homeowners recover from the financial crisis, and strengthen the housing recovery,” said Treasury Secretary Jacob J. Lew. “Thanks to a bipartisan group of members of Congress who helped secure additional funding for the Hardest Hit Fund, we will be able to provide significant resources to hard-hit states and target these critical resources towards programs that we know have helped Americans avoid foreclosure and stabilized housing markets, including blight elimination programs.”
The participating HFAs have until March 11 to submit their applications, the Treasury Department said.
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Source: Florida Realtors Feed

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