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Rhode Island Expands Assistance Program for Homeowners Facing Foreclosures

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By : Rudson Tren    99 or more times read
Rhode Island has decided to expand the coverage of the $80 million federal aid for homeowners who are facing foreclosures in the state. Distribution of the financial support started in the city of Providence on November 1. Since December 1, the state has expanded the aid to cover homeowners in the entire state.

The program is aimed at helping troubled homeowners who have been suffering from documented financial difficulties like losing income. Homeowners are required to qualify by submitting documents that prove unemployment, unforeseen medical costs, costly home repairs due to calamity, or death of a wage earner in the family.

Qualified homeowners who are facing foreclosures and who are eligible for the financial assistance are required to consult with their respective mortgage lenders. Rhode Island Housing, the agency in state dealing with housing and mortgage issues, does not accept direct applications. The homeowner could also seek a certified counselor to guide him though the application process for the so-called ‘Hardest Hit Fund.’

The $80-million financial assistance program aims to support distressed homeowners in several ways. First, it aims to obtain mortgage modifications from banks. Second, it intends to shoulder mortgage payments while the homeowner is unemployed. Third, it also intends to make immediate payments to spare a home like unpaid property taxes. The program also assists homeowners in relocating.

The financial assistance program also has its set of restrictions. One-family to four-family homes and condominiums are the only eligible properties. The homeowner must be living in the property and not in another home. The household income should be at most $87,800 for one or two-person families and up to $102,400 for bigger households.

Monthly mortgage payments, which include insurance and taxes, should be greater than 31% of total family gross income. It also is a requirement for the homeowner to have used up bank or government provided assistance. A $5,000 saving account, IRAs, and 401(k) are also exempted.

Rhode Island Housing oversees and supervises the assistance program. It has already scheduled series of meetings in communities to further explain the program. Consultations are held regularly every Tuesdays and Saturdays at designated areas. The Hardest Hit Fund is a state project with direct funding coming from the federal government.
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