Currently, Arizona is ranked second in the nation for foreclosure rates. Foreclosures happening around the state are primarily a result of job reductions, and loss of home values throughout the past three years.
According to a recent story in the Arizona Republic, because the foreclosure problem in Arizona is so prevalent, the Arizona Department of Housing has created a $125 million dollar plan to decrease foreclosures within the state. This plan was due to be submitted to the United States National Treasury for review this week. There are 5 other states, along with Arizona, which be be rewarded funds from a 1.5 billion dollar national foreclosure prevention fund.
As stated in the Arizona Republic,The plan created by, the state of Arizona has asked for money to help permanently modify responsible homeowners mortgages, assist homeowners with low income due to to job loss, and allow state aid due to hardships. The Arizona Republic states the following:
Permanent Modifications. Applicants must demonstrate personal responsibility. Their inability to pay mortgage is a result of an approved hardship. Must be 60 days delinquent. Modification would consider principal reduction, rate decrease, and/or term extension to achieve a monthly payment that does not exceed 31 percent of the homeowner’s monthly income.
Modest and reduced incomes. Resources would only be utilized to assist households with incomes at or below 120 percent of the area median income. Additionally, households would have to demonstrate that their incomes had been reduced since the home was last financed
Hardships. Applicant must demonstrate an approvable hardship. Those include; reduced income due to underemployment, medical condition, divorce or death.
All program options researched and considered
The United States Treasury is schedule to review this preliminary plan early next week . They will then provide the state with feedback and suggested modifications. The plan will not be finalized until late summer, at which time funds will be distributed.
If this plan is approved, resources for homeowners will be made available throughout the state and Arizona will be one step closer to fully recovering from its current foreclosure crisis.
If you live in Arizona and are having trouble making your mortgage payments, foreclosure is not your only option. There are loan modification programs and short sale programs available.
