Emergency Homeowners Loan Program (EHLP) in Texas

EHLP Program Introduction:

The 2010 Financial Reform Bill (Dodd-Frank Wall Street Reform and Consumer Protection Act) funds up to $50,000 (or 24 months) of mortgage payment relief for un-or-under employed homeowners facing likely foreclosure.  These funds are available through a re-authorized Ford-administration program, the Emergency Homeowners Loan Program (EHLP).

Texas was allocated $135.4 million under EHLP, which was targeted at the 32 states not funded under HUD’s “Hardest Hit Program.” The funds were allocated based on each state’s approximate share of unemployed homeowners with a mortgage. Texas received more funds under this program than any other state.  Nationally, EHLP received $1 billion.

While states could apply to administer the program if they had a “substantially similar” program already in place, it does not appear the state of Texas will be administering this program.  In Texas, the program will likely be run through Neighborworks America-affiliated foreclosure counseling agencies.

As of Jan. 5th, the program was still under development and was yet taking applications.

Further Eligibility Details

Income Reduction: EHLP provides mortgage payment relief, in the form of a forgivable loan, to eligible homeowners experiencing a drop in income of at least 15% resulting from involuntary unemployment or underemployment due to adverse economic conditions and/or a medical emergency.

Income Limit: Applicants must have had a total household income equal to or less than 120 percent of the Area Median Income (AMI) prior to their income reduction.

Likelihood of Foreclosure: Applicant must be at least three months delinquent on mortgage payments and have received notification of their lender’s/servicer’s intention to foreclose on their mortgage as a result of the delinquency.

Ability to Resume Payment: Applicant must be determined to have a reasonable likelihood of being able to resume repayment of the first mortgage obligations within 2 years.

Principal Residence: Applicant must reside in the mortgaged property as their principal residence, and the mortgaged property must be a singlefamily residence.

Additional Web Resources:

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