Emergency Homeowners' Loan Program Ends With More Than Half Of Money Unspent: Report

A government program aimed at helping unemployed homeowners avoid foreclosure ended with more than half its money unspent.

The Emergency Homeowners' Loan Program ended last month and the government will use only $432 million of the $1 billion it set aside for the program, according to USA Today. The reason? Officials charged with administering the program couldn't approve enough applicants in time to receive the aid.

The Department of Housing and Urban Development approved 11,832 of the 100,000 applications for the program, which was enacted as part of the Dodd-Frank regulations passed in response to the financial crisis, according to USA Today. Officials initially said that the program would provide $50,000 to 30,000 unemployed or underemployed homeowners in order to avoid foreclosure.

One of the reasons for the low number of approved applicants could be the strict requirements of the program. In order to receive a loan, applicants had to prove that their income had fallen by at least 15 percent due to the economic downturn, according to The Washington Post. In addition, applicants had to prove that once the loan disappeared -- it has a maximum of two years or $50,000 -- they'd be able to resume paying their mortgage.

Organizations across the country reported having difficulties finding applicants who qualified as the deadline for the loan neared at the end of last month, The New York Times reported. At a community development corporation in Minnesota's Twin Cities of St. Paul and Minneapolis, 31 out of 250 applicants received approval, according to the NYT.

A non-profit in California faced a similar uphill battle; the organization deemed 25 of the 1,200 applicants qualified and of those 25, five were approved as of Sept. 28, The Times reported.

The Emergency Homeowners' Loan Program is just one of the Obama Administration's loan modification programs that haven’t reached their goals, according to Propublica. Others include the Home Affordable Refinance Program, which aimed to help 4 to 5 million homeowners refinance their mortgages at low interest rates and a plan that gave money to state governments to experiment with programs for helping homeowners.

The Home Affordable Modification Program -- a plan also passed as part of the Dodd-Frank reforms that aimed to use subsidies to push bailed-out banks to modify home loans -- has also had less than stellar results. When Obama first introduced HAMP in 2009 he said it would help 3 to 4 million homeowners; instead, the program has helped less than 700,000.

Despite the deluge of programs aimed at helping homeowners and the housing market, the industry that precipitated the recession has yet to recover. A surplus of foreclosed properties is continuing to push home prices down and millions of homeowners owe more on their homes than they're worth.

Comments

[ibrowej]

02:13 PM on 10/25/2011

A very interesting and insightful video and commentary. It's a shame that bureaucratic red tape is getting in the way of providing available mortgage help to those that need it. This housing mess is not going to straighten out anytime soon. I think the government needs to back off for a while and let the industry right itself. Meanwhile renting is starting to look pretty good to me. For a limited time, the Relationship Capital Co. is offering free job search training for your unemployed readers at: http://RelationshipCapital.CO/JobNetworkingPrimer/?utm_source=bl&utm_medium=sm&utm_content=a

[becky bradshaw]

08:01 AM on 10/10/2011

An excellent place to find a good job is at the marina. The number of "Mega-Yachts" (larger than 75') has doubled in the last 12 years (Bush Tax Cut). These Limousines-of-the-Sea need servants. Deckhands, qualified chefs, and cute hostesses are always in demand. Make decent money, see the world, and share time with the "Elite People".

References:
Yacht Stats: http://www.msnbc.msn.com/id/13345720/ns/business-cnbc_tv/t/worlds-fleet-private-mega-yachts-growing/
Yacht Life: http://www­.msnbc.msn­.com/id/13­345720/ns/­business-c­nbc_tv/#

[MSROADKILL612]

03:57 AM on 10/10/2011

if u aint got the dough, u dont get to mow - sad both ways - the le mans start at 7am sundays is sad

[thestargazer]

12:01 AM on 10/10/2011

I wonder why democrats are trying to co-opt the rallies on Wall Street, They are as responsible as anyone for the lack of response to the crisis?

[ThankGodhesgone]

06:42 AM on 10/10/2011

Who has proposed a jobs bill - dems or repubs?

[rotorhead1871]

10:36 PM on 10/09/2011

need JOBS..........hello.........JOBS.......get it..........

[BuckCarson]

05:44 PM on 10/09/2011

"A government program aimed at helping unemployed homeowners avoid foreclosure ended with more than half its money unspent. "

When are liberals going to realize that expecting government to solve every inequity simply doesn't work?

[ThankGodhesgone]

06:43 AM on 10/10/2011

When is the private sector going to provide enough jobs?

[BuckCarson]

07:26 AM on 10/10/2011

As soon as your faces look like job applicants rather than entitlement judges.

[ILoveGreatDanes]

01:07 PM on 10/09/2011

My husband and I have decided to ditch our house and just live with bad credit for several years. We're completely underwater on our mortgage, the house needs at least $20K in repairs before it's even saleable, and there's still 27 years of payments left. We don't want to throw good money after bad. Plus the housing market in our area stinks, and there's no end in sight. We have $16,000 saved, a credit card, and a line of credit. Time to move on to something better.

[ReaItors Are Liars]

03:15 PM on 10/09/2011

Good thinking ILoveGreatDanes!

F&F

[rotorhead1871]

10:37 PM on 10/09/2011

best of luck.....

[Suffie]

12:38 PM on 10/09/2011

Struggling homeowners have to go through tons of red tape and face rejection while the banksters received their funds immediately and with no strings attached. Carte blanche...didn't even have to tell the government where all the money really went. Bill Clinton's idea to put a moratorium on foreclosures was the best, and it would have had the banks quickly scrambling for a solution.

[Andy17]

01:44 PM on 10/10/2011

I noticed the mega-banks didn't have to do a thing to get almost a trillion dollars.
The US bean counters make homeowners jump through hoops to get $30K,
and they only approve 10% of the applications before 'running out of time'.
What BS!

[loki]

11:53 AM on 10/09/2011

but if this was for rich homeowners, it would not only be working, but it would be getting increases in funds and benefits daily. Why? because they know the poor and working class can actually work. But the rich only survive from sucking the life , and money, from the working class and poor. So the rich could not survive without someone else filling their pockets with money and doing the work for them. Anyone , if they have access to money and influence, can start a business. But it takes the workers to make the business successful and profitable. But its always the rich sociopath who had the money to open the company that gains from the workers work. Not the workers who are always getting pay cuts, called lazy and stupid from the rich Sociopathic parasite who can only live off others work. Its a sad world when those who work hard suffer because they are required to make a very few parasites fat and happy.

[blndgenie]

02:37 PM on 10/09/2011

what exactly are the 'rich' doing which 'sucks the life and money' from the working class and poor? Without working themselves, how are they doing this? Please be specific and explain in detail. Thanks.

[sco8d]

11:24 PM on 10/09/2011

How about lending money to them, pumping up the interest rate they pay, repeatedly, and with the consent of Gov. until they can't pay anymore, taking their homes and asking and getting a "bailout" for the money they "lost" as the price of the homes they "own" now are worth less than the money they loaned out. While the people who used to occupy the houses are left out in the street, with huge debt and nothing to show for it, ans now SIT on the TRILLIONS in bailout money, refusing to lend because no strings were ever attached? Like that maybe?

[ThankGodhesgone]

06:46 AM on 10/10/2011

The rich work? I thought they all wanted to lower the capital gains tax on their profits on dividends and interest?

[blndgenie]

02:38 PM on 10/09/2011

who exactly is 'requiring you' to make 'a few parasites fat and happy'? Are you enslaved? Indentured? Why dont' you open your own business which you can then run in a 'socially and morally responsible manner'? Who is FORCING you against your will? Again, specifics please.

[ThankGodhesgone]

06:49 AM on 10/10/2011

Have you tried to get a loan to open a business? Or do you think we have cash stashed away to open one?

[sfizi]

08:03 AM on 10/09/2011

How can we afford a home if there's no jobs , maybe if we move to china, korea, mexico etc we may have more chances to find a job than here ..

[Kes Teds]

04:42 AM on 10/09/2011

Lot of people are in a bad situation nowdays.

t-investments.blogspot.com

[notalwaysfittoprint]

10:44 PM on 10/08/2011

If only they had scre**ed up like this when it came to bailing out Wall Street!

[Nightangle]

09:39 PM on 10/08/2011

The President HAMP - to help homeowners with mortgage problems that cost 52 billion fell flat and another questionable mixture of Shovel Not So Ready Job Part IIand HAMP Part II are not going to help either.

Job creation and HAMP should have been the priority. Instead for 2 1/2 years, the President focused on the ill fated ObamaCare.

Too little too late. 3 of the 4 years wasted time and resources.

[blndgenie]

02:40 PM on 10/09/2011

ONE PERCENT who got part of the billions in aid are still in the program. The rest, money down the taxpayer drain. Interesting number given the protests of the WallBaggers.

[jnratliff]

08:27 PM on 10/08/2011

All of these plans will fall flat until there are jobs!

[scottgamsnc]

08:23 PM on 10/08/2011

Yep, and they want to take over health care...people will be dying waiting on the paperwork to get approved! This was being run by the P-bo administration too!