Governor Rell: Programs Now Available to Help Subprime Borrowers
This news release was issued by the Governor's Office
July 1, 2008
Governor M. Jodi Rell today said that a law that takes effect today creates borrower assistance programs that will help to provide relief to homeowners with subprime mortgages.
“These programs will provide relief to hundreds of Connecticut borrowers who are now facing foreclosure as a result of the subprime crisis,” Governor Rell said. “By being able to work directly with their lender or a counseling agency, many borrowers will be able to reach a modification agreement or set a budget that will allow them to make their monthly mortgage payments.”
Public Act 08-176 re-establishes the Emergency Mortgage Assistance Program (EMAP) with $64 million in funding to be administered by the Connecticut Housing Finance Authority (CHFA). More information can be found at firstname.lastname@example.org.
“Those who receive an EMAP loan from CHFA will have the security of knowing they will be able to stay in their homes for up to five years while they work to improve their circumstances or modify the terms of their loan,” Governor Rell said.
The multitude of programs available to Connecticut borrowers includes mortgage assistance, loan refinancing, foreclosure mediation and job training.
A call center has been set up at CHFA to provide additional information on the programs. Anyone interested should call CHFA at 860.571.3500 or toll free at 877.571.CHFA (2432).
Under the new state law, lenders are required to notify borrowers facing foreclosure of the opportunity to speak with their lender or a CHFA-approved consumer credit counseling agency to attempt to resolve the delinquency or default. If after speaking to the lender or counseling agency the borrower is still unable to resolve the delinquency or default, they may be eligible to apply directly to CHFA for an EMAP mortgage. If the borrower is approved for an EMAP mortgage, CHFA will make monthly mortgage payments on the borrower’s behalf directly to the lender for up to five years. The borrower will be required to make at least a partial payment to CHFA during that time.
The Homeowner’s Equity Recovery Opportunity (HERO) Program will also begin on July 1. Under PA 08-176, CHFA is authorized to purchase eligible mortgages directly from lenders and make available alternative financing to borrowers in the form of HERO loans that provide for affordable repayment plans. Eligible borrowers are those live in a one-to-four family residence in Connecticut. Single family condominiums and planned unit developments are also eligible.