Unemployed homeowners in areas hard hit by the economic downturn may be eligible for zero-interest loans to make their mortgage payment for up to two years under a new foreclosure prevention program HUD will roll out in the weeks ahead.
The Obama administration is giving the Department of Housing and Urban Development $1 billion to start the program, which is designed to help mortgagors who have suffered what the government calls a "substantial reduction" in income due to job loss, underemployment, or a medical condition.
These interest-free loans are capped at $50,000 and recipients must have demonstrated a good payment history prior to their loss of income.
The Treasury Department also is providing $2 billion of additional funding for its "Hardest Hit Housing Market" program to help unemployed homeowners in 17 states and the District of Columbia.
