SC Help: New Options to Avoid Foreclosure
South Carolina Funding Options Helps Homeowners
Approximately 295 million dollars in Hardest Hit Funds has been awarded to the State of South Carolina to help struggling homeowners avoid foreclosure. When retaining the property is no longer an option, SC HELP offers a program that will give the homeowner monetary assistance if they can avoid foreclosure by means of a Short-sale option or Deed-in-Lieu.
Watch the SCR Webinar (archived here; login required) with Mandie Mills from the SC State Housing Finance and Development Authority, who shares details about the SC HELP Property Disposition Assistance and how it can help your clients, friends, or family.
Key components for SC HELP include:
• Monthly Payment Assistance-assisting homeowners with monthly payments for a defined period of time while they seek employment and a return to self sustainability.
• Direct Loan Assistance-for borrowers who have experienced a hardship but have regained the ability to pay. Funds can be used to pay arrearages in order to bring the loan current.
• Property Disposition Assistance-in cases where the mortgage cannot be salvaged, funds may be provided to incentivize short sales, deeds-in-lieu of foreclosure and to help transition families from homeownership to rental housing.
Homeowner applicant criteria:
Homeowners applying for Monthly Payment Assistance or Direct Loan Assistance must meet certain threshold requirements in order to apply for help:
1. Borrower or co-borrower must be able to document that the delinquency was a result of a hardship event beyond his/her control (i.e. unemployment, death of a spouse, catastrophic medical expenses, etc.)
2. Mortgage payments must have been made on time for 12 months preceding the hardship event with no more than two 30-day late occurrences
3. The property securing the mortgage must be owner-occupied as a full-time residence
4. Borrower must provide a financial hardship affidavit
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 nonrecourse zero-percent 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 property is sold or refinanced
prior to the loan termination date, funds will be recovered should sufficient equity be available
from the transaction. The Property Disposition Assistance Program will provide a one time,
lump sum grant to the recipient.
