Financial stresses for many people during this time in our country’s history have never been greater.  There is some misunderstanding regarding assistance that is available to borrowers who are not able to make their mortgage payments.  I came across the following news release from the SC HELP Program that provides clarity on some help that is available for borrowers who are behind.  SC HELP is a program of SC Housing Corp. a division of the South Carolina State Housing Finance and Development Authority.

[press release - January 19, 2011]

SC HELP Foreclosure Prevention Program Now Available Statewide.  Almost $300 million in funds available to keep homeowners in their homes.

Following a successful pilot program and Treasury’s approval of South Carolina’s readiness assessment, SC Housing Corp. will take its foreclosure prevention program statewide.  Starting January 20, 2011, the South Carolina Homeownership and Employment Lending Program (SC HELP) will use almost $300 million in federal funds to help responsible but struggling homeowners in the state.

Key components for SC HELP include:

• Monthly Payment Assistance
• Direct Loan Assistance – for borrowers who have experienced financial hardship but have regained the ability to pay
• Property Disposition Assistance

Homeowners applying for Monthly Payment Assistance or Direct Loan Assistance must meet certain threshold requirments in order to apply for help:

1. Borrower must be able to document that the delinquincy was a result of a hardship event beyond his/her control.
2. Mortgage payments must have been made on time for 12 months preceding the hardship event
3. The property securing the mortgage must be owner-occupied
4. Borrower must provide a financial hardship affadavit
5. Mortgage can be no more than 120 days delinquent
6. Loan servicer/investor must be willing to accept payments and provide required data and reporting

Assistance from SC HELP will be provided in the form of a norecourse zero-interest, non-amortizing, forgivable loan secured by a subordinate lien on the subject property.  The loan will be forgiven over a five-year period at a rate of 20% per year.  If the property is sold or refinanced prior to the loan termination date, funds will be recovered should sufficient equity be available from the transaction.  Property Disposition Assistance will provide a one-time, lump sum grant to the recipient.

Additional criteria and documentation requirements must be met for final eligibility determination.  Homeowners wishing to make an application should apply online at www.SCMortgageHelp.com.  Homeowners may call toll-free to 855-HELP-4-SC (855-435-7472) to begin the process.

SC HELP is intended to assist responsible borrowers – those borrowers who are facing possible foreclosure due to circumstances beyond their control.  SC HELP is not intended to serve borrowers who are facing foreclosure due to poor credit and/or debt management, stripping the equity from their home for non-essential purposes, or overall mismanagement of the personal budget.