Sacramento, CA - After a lengthy delay, the "Keep Your Home California" program is finally set to begin phase one on Monday, January 10, involving nearly $2 billion to help struggling California homeowners stay in their residences.
The entire program is being administered by the California Housing Finance Agency. It was originally scheduled to start November 1.
Phase One
The first phase of the federally-funded program has the state making direct mortgage payments for eligible unemployed Californians. Unemployed homeowners can receive up to six months' worth of house payments with payments up to $3,000 a month eligible for the program.
CalHFA officials report the total amount available for phase one payments is $875 million. It requires lenders to buy into the program due to the fact they must be willing to share borrowers' confidential date with the state
Phase Two
Phase two and the balance of the program — which includes a "buydown" feature — is now set to launch on Monday, February 7, and also requires a buy-in from lending institutions,
Some $800 million has been reserved to help reduce outstanding loan balances. For every $1 the lenders agree to reduce on a borrowers' balance, the state will match it with $1, realizing a $2 reduction on the borrowers' principal.
Lender Communications
While the final requirements are being ironed out, Keep Your Home California organizers urge homeowners to continue working with their lenders and not wait for the program to start.
The program is expected to assist an estimated 100,000 low- to moderate-income borrowers.