Homeowners Seek More Help With CT Mortgage Program Feedback

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As Connecticut is ready to embark on the final phase of its mortgage assistance program, small homeowners say there is not enough help available after months of missed rent payments during the pandemic. COVID-19.

Just over half of the 26 messages submitted on the proposed plan for the Homeowner Assistance Fund Program during the public comment period the Connecticut Housing Finance Authority addressed the issue. The posts came largely from owners and real estate agents denouncing the requirement that qualifying properties must be owner occupied.

But Nandini Natarajan, chief executive of the financial authority, said the mandate is defined by federal law and cannot be changed at the state level. The flood of feedback from owners underscored the need for more education and awareness about the program, she said.

“I don’t think I expected it, but being able to explain things to people is important,” Natarajan said. “So that will be one of our goals, is to make sure that we do outreach widely. “

The state has already completed the first phase of its pilot homeowner assistance fund program. Applications for the second phase of the pilot project are closed to landowners, although Natarajan said it could be reopened if the need arises.

While the financial authority awaits federal approval, Natarajan plans to start educating municipalities and mortgage departments. The authority will also launch an online portal to process requests and other tasks required to start the program.

The full program, aimed at stopping a wave of foreclosures when forbearance options expire, is expected to launch by Nov. 30 or 45 days after the plan is approved by the U.S. Treasury Department, according to the last eventuality, depending on the draft plan.

The program was funded by the American Rescue Plan Act of 2021.

The federal government has offered homeowners the option of using an 18-month forbearance or a temporary mortgage payment freeze. As those options begin to expire this fall, experts believe there will be more foreclosures in Connecticut, a state with high mortgage delinquency rates, indicates a 28-page document outlining the full program plan.

“The economic downturn has also caused a severe housing crisis in Connecticut, leading to increased delinquency rates and an uneven resumption of the pandemic in the housing market, especially among low-income homeowners and communities of color. », Indicates the document.

“Without the intervention of programs like CTHAF [Connecticut Homeowner Assistance Fund], Connecticut would likely experience a wave of foreclosures, a prolonged economic recovery, and a reduction in the local tax base.

Many details for the full plan are yet to be defined. The state’s financial authority plans to submit its final proposal to the federal government by Oct. 15, Natarajan said.

But she predicts that the aid ceiling will be $ 30,000. The plan also states that the income limit can reach 150% of the region’s median income, homeowners must have been financially impacted by COVID-19 and they must have been up to date with their mortgage payments by October 21, 2019.

Homeowners who live in a multi-family home and rent up to three other units in the building may be eligible, she said. But those who don’t live in their rental properties as a primary residence cannot.

“I can’t do anything about it because it’s not the intention of the law,” she said. “I’m not saying that I don’t have sympathy for the owners. That doesn’t allow us to make an exception there.

The owners who wrote were directed to UniteCT, the state rent assistance program administered by the Connecticut Department of Housing.

While UniteCT still has money available for eligible tenants, landlords say that in part because of program delays, administrative requirements, and issues with tenants, they want help through ‘a mortgage assistance program. Landlords and documents indicate that some tenants do not qualify for the program and others do not want to apply.

The program’s early delays and lack of certainty as to when the money will arrive has also put some homeowners off, they said.

“When you don’t get rent, that money has to come somewhere,” said Julie Nearing, real estate agent and landlord at Farmington who submitted a comment. “I didn’t want to take it from my family.”

During the pandemic, Nearing worked extra shifts at the hospital where she works as a therapist. This is his main source of income, and the properties generally provide an additional flow of money.

But over the past year and a half, many of its tenants have fallen behind on rent. She owns six properties and had to sell one to make ends meet after her loan from the US Small Business Administration expired.

She is not alone.

Other emails to the financial authority’s public comment email have sounded similar alarms: owners say they need more help.

“I am very upset that federal assistance program money is not going to Connecticut owners of small investment properties unless they are owner occupied. It is very unfair for small investors who are trying to make ends meet in a very difficult economy, ”one reads.

“This funding should be expanded to include local Connecticut ‘Mom and Pop’ investors to help keep our neighborhoods safe and stable,” said another.

Nearing’s main concern is making sure her teenage daughter has the money she needs to cover her college education or any other unforeseen expenses that arise.

“I don’t get child support or alimony or anything like that,” she said. “Everything I do is on my own. I have no partners in my business. I have been very proud of it for a very long time. So, I am not rich, I am not a big investor. I’m just working really hard for my retirement and college expenses.

Bob DeCosmo, retired owner and president of the Connecticut Property Owners Alliance, said his main concern was the impact on communities if small owners were bankrupted or forced to sell properties. DeCosmo was one of those who submitted a comment to the state’s financial authority.

“We’re going to get cold and corporate and impersonal because of all these mom and pop owners losing their properties to out of state owners,” he said. “This will create a real affordable housing crisis.

Other comments came from advocacy and community groups as well as homeowners who have fallen behind on their mortgages.

A landlord said she had been on hold since May 2020 and her loan officer was unaware of the program.

“Is there any information you can provide to the state’s major mortgage officers about the program?” And, is there a potential mass enrollment date for program owners? She wrote.

“I am confident that things will pick up again [sic] back to normal soon, but this program will definitely help me. I wanted to let you know that I am extremely grateful to have the help of giving, ”read another.

Habitat for Humanity representatives in eastern Connecticut said the funds must be dispersed quickly. A letter from the Partnership for Stronger Communities, Bridgeport, said qualified utilities should include heating, called on the state to remove a requirement to attend financial literacy courses and make paper applications available in several languages.

Natarajan said she and other officials are still considering ways to speed up the process and what comments to incorporate.

“We are processing the comments right now and trying to determine if there are any changes that we are going to make,” she said.


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