HARRISBURG, August 13, 2012 – Pennsylvania’s Homeowners’ Emergency Mortgage Assistance Program (HEMAP) is once again accepting applications now that the state has received its portion of the national settlement with mortgage servicers, state Sen. Jay Costa, (D-Allegheny) said today.
“The HEMAP program has helped thousands of Pennsylvania families in danger of foreclosure stay in their homes,” Costa said. “The program is so valuable for families struggling in tough economic times.
“Using dollars generated by the national settlement and implementing the multi-year funding plan the legislature crafted in the Homeowner Assistance Settlement Act (SB 1433, Act 70) ensures that HEMAP will continue to serve Pennsylvania for years to come.”
The governor announced on August 9 that Pennsylvania was in receipt of the $66.5 million of direct payment due as a part of the $25 billion settlement with the nation’s largest mortgage service providers. The federal-state settlement with five of the largest mortgage services in the United States is intended to address concerns about abuses in mortgage foreclosure and loan servicing.
Pennsylvania is slated to receive an estimated $266 million all told, with a significant portion of the funds going to consumers for loan modifications, direct relief, refinancing and cash payments to homeowners that lost their homes as a result of abusive practices
The HEMAP program was closed on July 1, 2011 when Gov. Tom Corbett eliminated funding for the program.
Costa said that in February Senate Democrats sent a letter to the Pennsylvania’s attorney general asking that funding from the settlement be set aside to fund HEMAP and provide relief to economically hard-hit families.
“HEMAP is a critical program whose funding should have never been cut,” Costa said. “Balancing a state spending plan on the backs of families struggling to stay in their homes in the middle of economically-trying times made no sense,” Costa said. “That’s why Senate Democrats fought so hard to try and find dollars to fund the program.”
Act 70 allocates up to $18 million from the Homeowners Assistance Settlement Fund to fund mortgage assistance measures, with 90% of the funding reserved for HEMAP and 10% reserved for funding consumer protection programs. An additional $6 million will be available to immediately address residual backlog. HEMAP will receive $12 million per year over a five year period from the settlement funds.
According to Costa, since 1983 HEMAP has provided loans to more than 46,000 families who were behind on their mortgages. In the years, 2008-2010 HEMAP helped more than 6100 families stay in their homes.
“We need to maintain and build communities and keep families in their homes,” Costa said. “Helping families remain in their neighborhoods helps our economy and provides stability for communities throughout Pennsylvania.”
More information can be obtained about HEMAP through the Pennsylvania Housing Finance Agency (PHFA). PHFA can be reached by calling 1-800-342-2397 or online at www.phfa.org.