There’s new life for Pennsylvania’s Homeowners Emergency Mortgage Assistance Program.
The program known as HEMAP is credited with keeping 47,000 people from losing their homes. It fell victim to budget cuts, though, and the lending program stopped taking in new applications a year ago.
Now, Pennsylvania plans to revive it using settlement money from a national lawsuit that called out banks for “robo-signing” approvals for foreclosures without certifying all the underlying facts.
“Pennsylvania’s share directly to the state is $66 million, and 90 percent of that money is going to go to the HEMAP program,” said John Dodds, the director of the Philadelphia Unemployment Project.
The state would allocate the money over five years to troubled homeowners, though Dodds is worried it won’t be enough.
“Foreclosures are up dramatically this year in Pennsylvania,” said Dodds. “A lot of banks were holding up on foreclosures because of the ‘robo-signing’ crisis. This settlement kind of solves that problem, so they’re going back to foreclosures.”
So, while the settlement provides some relief, it also will increase demand for HEMAP.
A bill authorizing use of the settlement funds for HEMAP awaits Gov. Tom Corbett’s signature. Soon after, likely by July, homeowners will be able to apply for assistance.