However, help has been slow to arrive, Mancini says. “The consequence is that there have been very few approvals and not a lot of the money has gotten out there in many states,” she says. “And that creates the risk of people getting foreclosed on before they can get the assistance.” California, for example, was awarded more than $1.05 billion from HAF, the most of any state. As of June 28, California had handed out about $81.3 million to 2,301 homeowners, according to an online state dashboard tracking the program. Loan servicers, meanwhile, have had to navigate differences between state programs. “For future similar program rollouts, consideration should be given to streamlining program guidelines, eligibility requirements, servicer participation requirements and rollout timelines,” says Gail Balettie, senior vice president of client satisfaction at Celink, a subservicer based in Lansing, MI. “Because each state program has developed their own program at their own pace, implementation has been complicated for both state administrators and loan servicers.” While state rules may vary, HAF’s overarching goal does not. The fund aims to prevent mortgage delinquencies and defaults, foreclosures, loss of utilities or home energy services, and displacement of homeowners who have experienced financial hardship since January 21, 2020. Borrowers can use the assistance to cover mortgage payments, homeowners insurance and utility payments, among other purposes. For HECM borrowers, the greatest needs have arisen in the areas of property taxes, insurance and homeowners association fees/dues, according to Balettie. “States where property taxes are high, as in the Northeast and Midwest, are always of concern for homeowners, especially for seniors who live on fixed incomes,” she says. Still a Need More than two years after the onset of COVID-19, consumer advocates see a continuing need for help, particularly since foreclosures could ramp up through the end of 2022. A federal moratorium on foreclosures expired in September 2021. “Quite a few people are unprotected from foreclosure right now,” Mancini says. Nonetheless, observers are optimistic that HAF can keep eligible borrowers out of trouble and prevent a wave of people from losing their homes. “I’m hoping that being preemptive, with the program starting when it did, can negate a lot of that,” says Todd Capitao, director of financial empowerment at Tenfold, a housing-focused nonprofit organization in Lancaster, PA. Under the program, each state was guaranteed to receive at least $50 million. Following California, other big recipients include Texas at $842.2 million, Florida at $676.1 million and New York at $539.5 million. A U.S. Treasury Department website lists details for each state program, as well as programs in U.S. territories and tribal lands. The states collect applications for aid and determine who is eligible. However, loan servicers still can make a difference, Balettie says. “Celink has been aggressively proactive in reaching out to borrowers in default who may be helped by the fund or any loss mitigation available.” The company also has been working with states and partnering with consumer advocates to ensure that senior HECM borrowers have access to the funds, as well as other sources of relief, she says. “There are a number of loss mitigation options available to HECM borrowers under the [U.S. Department of Housing and Urban Development] HUD program, and Celink provides those options to any borrower who may find themselves not being able to meet their loan obligations.” One of the challenges seniors may face involves the online process of applying for aid. In Pennsylvania, for example, applicants need an email address to navigate an online portal, which can be a hurdle for some borrowers over 62, according to Capitao. Tenfold has been helping forward and reverse borrowers access the $350.4 million in HAF funding allotted to Pennsylvania. As of June 30, the state has distributed nearly $11.8 million to 1,445 borrowers, according to its online dashboard. Helping Reverse continued on page 22 Sarah Bolling Mancini Gail Balettie Todd Capitao REVERSE MORTGAGE / SEPTEMBER–OCTOBER 2022 21
RkJQdWJsaXNoZXIy MjQ1MzY1