CRANSTON, RI – (RealEstateRama) — In an effort to keep families in their homes and minimize foreclosures, U.S. Senator Jack Reed today announced an additional $9.68 million in foreclosure prevention funding will be coming to Rhode Island from the Hardest Hit Fund (HHF) program at the U.S. Treasury Department. Reed wrote to U.S. Treasury Secretary Jacob Lew in January urging the additional HHF resources for Rhode Island, citing the continued need for foreclosure prevention assistance in the state.
The Hardest Hit Fund is a flexible source of federal aid that has been used in Rhode Island to help protect neighborhood home values, help unemployed homeowners remain in their homes while they search for new employment, and for other programs to encourage sustainable and affordable homeownership.
“I am pleased Treasury is providing additional Hardest Hit funding to Rhode Island. These funds will help stabilize the housing market while keeping more families in their homes and minimize further foreclosures that can really burden neighborhoods. This additional federal funding is good news for Rhode Island and will be a big help for homeowners and communities still looking to get back on their feet,” said Senator Reed, a senior member of the Senate Banking Committee, which oversees federal housing policy, and the Ranking Member of the Appropriations Subcommittee that oversees the funding for federal housing programs.
The housing crisis that began in 2007 led to unprecedented home price declines, as well as sustained and higher unemployment in certain parts of the country. Families in these areas were particularly hard hit by the crisis as they have struggled to make their monthly mortgage payments and grappled with deeply underwater mortgages. According to the Mortgage Bankers Association National Delinquency Survey for the third quarter of 2015, Rhode Island was among the top ten states with the highest percentage of loans in foreclosure. Rhode Island’s percentage of loans in foreclosure is more than 36% higher than the national average, and its serious delinquency rate is more than 38% above the national average.
First announced in February 2010, the HHF program provided federal funding to the 18 states most affected by home foreclosures to develop locally-tailored programs to assist struggling homeowners in their communities. Under the original formula proposed by the Obama Administration in 2010, Rhode Island would have been excluded from the HHF program. Senator Reed successfully fought to adjust the formula to include Rhode Island, arguing that the Administration didn’t fully take into account how hard states like Rhode Island had been hit by the foreclosure crisis.
To date, Rhode Island has received $79 million in HHF dollars to help prevent foreclosures and stabilize the state’s housing market. Since its launch in December 2010, more than 5,300 Rhode Island homeowners have sought HHF counseling, and more than 3,300 homeowners received assistance from the program, according to Rhode Island Housing. At one point, the state program stopped accepting applications due to insufficient funding, but the Consolidated Appropriations Act of 2016 made another $2 billion in HHF assistance available to the states.
In addition to the nearly $10 million in federal funding announced today, Rhode Island will have an opportunity to apply for approximately $39 million in additional HHF resources if the state demonstrates need and the ability to quickly deploy these funds effectively.
Rhode Islanders interested in learning more about who qualifies for assistance from the HHF program and how to apply should review the Hardest Hit Fund – Rhode Island fact sheet and visit the state’s HHF program website.