Some 1,500 Puerto Rico homeowners facing the possibility of foreclosure may be able to qualify for a new $20 million emergency assistance program unveiled Friday by the Puerto Rico Housing Finance Authority, in agreement with local banks.
Through the “Protecting your Home” program, families and individuals who have experienced a drop in income and are at risk of losing their dwelling may apply for 18 months of mortgage payments assistance, said HFA Executive Director George Joyner during a news conference Friday.
The HFA’s new program should favor the island’s working and low-income citizens, Joyner said.
“We want to help families that lack cash resources to pay their mortgage,” said Joyner.
Starting May 16, the agency will start accepting applications from affected homeowners who will undergo an evaluation process that includes verifying their income and the circumstances that have kept them from making their mortgage payments.
To qualify, applicants must be at least three months behind on the mortgage payments related to their primary dwelling. If approved, the government will provide a maximum of $20,000 to assist them with mortgage payments during the 18-month term. The beneficiary will be expected to contribute at least 30 percent of their gross income, with a minimum of $100 a month, Joyner said.
The agency is ready to receive about 5,000 applications, of which it will be able to qualify 1,500 for the assistance program, based on the order in which the application was received, he noted.
The beneficiary will not have to pay back the amount of assistance received as long as they remain in the home for five years after the program ends.
At present there are 16,000 mortgage loans that are 120 days in arrears, some of which already may be under loss mitigation plans, bankers present at the news conference said.
The number of cases that end in foreclosure average about 2,500 a year. Local banks have a combined portfolio of some 450,000 mortgage loans, the representatives noted.
“It’s a tragedy for the family that ends up in foreclosure,” Joyner said.