TALLAHASSEE — Florida Housing Finance Corporation representatives are accepting online applications starting 9 a.m. Eastern Time tomorrow, May 15, for the state's Hardest-Hit Fund Principal Reduction program.
Floridahomeowners who have remained current on their mortgages, but missed out on the opportunity to apply for the program last fall, will be able to do so later this week. Apply for free at the official Florida HHF Principal Reduction website for homeowners in all 67 counties.
“Since we first announced that the Florida Hardest-Hit Fund would implement a Principal Reduction program for homeowners who have remained current on their mortgages, we have been able to assist more than 2,400 homeowners with nearly $102 million,” said Steve Auger, executive director of Florida Housing.
“While our state’s housing market continues to recover, this is a second opportunity for those homeowners who did not apply last year to see if they may qualify for HHF-PR assistance.”
The program reached its goal of accepting 25,000 applications within one week prior to closing the application process last fall.
Florida Housing anticipates that online applications will continue until disbursements for qualified and approved homeowners near the $350 million in Florida Hardest-Hit funds approved by the Corporation’s Board.
As HHF-PR funding nears the allocation, Florida Housing will make public announcements approximately five working days prior to closing the application. Previous applicants who were deemed ineligible may have their applications re-evaluated by contacting their assigned HHF-PR Advisor and should not submit a new application.
The Florida HHF-PR program is designed to provide up to $50,000 to eligible homeowners who owe at least 125 percent more on their home than its current market value—commonly known as having a home that is “under water.”
Funds will be applied to reduce the principal balance of the first mortgage to lower its loan-to-value (LTV) to no less than 100 percent. The mortgage can then be recast (re-amortized) or refinanced to produce a lower monthly mortgage payment.
The minimum qualifications a homeowner must meet to be considered for participation in the Florida HHF-PR program are as follows:
•Must be a Florida resident and a legal U.S. resident/legal alien, and occupy the property as the primary residence
•Must be current on the monthly mortgage payment—first mortgage payment cannot have been 60 or more days late within the past 24 months
•Must have purchased the home prior to January 1, 2010
•The unpaid principal balance for the first mortgage cannot exceed $350,000
•The loan-to-value ratio for the first mortgage must be more than 125 percent. In other words, home must be more than 125% “under water.”
•The total household income, including all persons age 18 years and older who live in the home, must be less than 140 percent of the Area Median Income.
Principal reduction program funds will be in the form of a 0-percent interest, forgivable loan that will be subordinate to current mortgages on the home. The loan can be forgiven over a five-year period, at a rate of 20 percent each year. For conventional mortgages, once HHF-PR funds are applied to the principal, the mortgage will be recast (the terms of the loans will remain the same, but the loan will be re-amortized).
If the borrower has a FHA, VA or USDA-RD mortgage, the mortgage will need to be refinanced within 180 days after closing on HHF principal reduction funds in order to receive the pro rata forgiveness.
If a refinance is not completed within the specified time, the principal reduction loan will be 100 percent forgiven after a full five years, with no incremental forgiveness.
Visit the website for more information or call the toll-free info line at 1-877-863-5244.