The Mortgage Payment Program
Program Overview
The Mortgage Payment Program (MPP) is a foreclosure prevention program that provides a zero-interest, non-recourse, deferred-payment, subordinate loan that will be forgiven after 10 years. MPP loan funds can be used 1) to bring delinquent past-due mortgage(s) current and/or 2) to pay monthly mortgage payments and other mortgage-related expenses that are not escrowed (i.e. property taxes, homeowner insurance, mortgage insurance, and homeowner’s association dues) while the homeowner seeks employment or trains for a new job.
Homeowners will be eligible to receive up to $36,000 (not to exceed 36 months of assistance). The program is targeted to those with employment-related issues that are able to recover from a financial hardship. MPP loan recipients must be either 1) willing to search for employment, 2) willing to attend school to secure employment, or 3) must have recovered from a temporary program-eligible financial hardship and need assistance bringing their mortgage payments current (reinstatement).
What is a Program Eligible Financial Hardship?
- A program-eligible financial hardship is an event or condition that has caused a reduction in income that is likely to improve in the foreseeable future (i.e. illness, death of a co-borrower, divorce or separation).
The homeowner must meet eligibility and program underwriting guidelines and must also complete a hardship affidavit. As each situation is different, please talk to a RADA Housing Counselor to determine if you are eligible to apply for MPP assistance.
Note: Homeowners who are within 15 calendar days of a foreclosure sale cannot submit an application for MPP assistance. If the Clerk of Court postpones the sale date to meet the 15-day requirement, the MPP application may be submitted.
Homeowners will be eligible to receive up to $36,000 (not to exceed 36 months of assistance). The program is targeted to those with employment-related issues that are able to recover from a financial hardship. MPP loan recipients must be either 1) willing to search for employment, 2) willing to attend school to secure employment, or 3) must have recovered from a temporary program-eligible financial hardship and need assistance bringing their mortgage payments current (reinstatement).
What is a Program Eligible Financial Hardship?
- A program-eligible financial hardship is an event or condition that has caused a reduction in income that is likely to improve in the foreseeable future (i.e. illness, death of a co-borrower, divorce or separation).
The homeowner must meet eligibility and program underwriting guidelines and must also complete a hardship affidavit. As each situation is different, please talk to a RADA Housing Counselor to determine if you are eligible to apply for MPP assistance.
Note: Homeowners who are within 15 calendar days of a foreclosure sale cannot submit an application for MPP assistance. If the Clerk of Court postpones the sale date to meet the 15-day requirement, the MPP application may be submitted.
Types of MPP Assistance
There are three types of assistance available under the Mortgage Payment Program:
Note: If your mortgage is more than 6 months delinquent, you may still be able to apply for Job Search assistance. See the Homeowner Contribution Options below.
MPP Job Search assistance is available up to $36,000 for a minimum of 6 months and a maximum of 18 months. You must need at least six months of assistance to be eligible for Job Search assistance.
The homeowner must be receiving (or have received) unemployment benefits. If the homeowner did not qualify for unemployment benefits because he/she worked for an employer who did not contribute to the unemployment insurance fund, the homeowner must obtain a letter of verification from that employer as part of the MPP application. There may be exceptions for self-employed homeowners.
MPP Job Training assistance is available up to $36,000 for a maximum of 36 months.
Note: If you need more financial assistance than is offered by the program or require more than 36 months to complete your training, you may still be able to apply for assistance. See theHomeowner Contribution Options below.
Note: If your mortgage delinquency exceeds the $36,000, you may still be able to apply for one-time Reinstatement. See the Homeowner Contribution Options below.
- Job Search (Short-term Assistance)
Note: If your mortgage is more than 6 months delinquent, you may still be able to apply for Job Search assistance. See the Homeowner Contribution Options below.
MPP Job Search assistance is available up to $36,000 for a minimum of 6 months and a maximum of 18 months. You must need at least six months of assistance to be eligible for Job Search assistance.
- Job Training (Long-term Assistance)
The homeowner must be receiving (or have received) unemployment benefits. If the homeowner did not qualify for unemployment benefits because he/she worked for an employer who did not contribute to the unemployment insurance fund, the homeowner must obtain a letter of verification from that employer as part of the MPP application. There may be exceptions for self-employed homeowners.
MPP Job Training assistance is available up to $36,000 for a maximum of 36 months.
Note: If you need more financial assistance than is offered by the program or require more than 36 months to complete your training, you may still be able to apply for assistance. See theHomeowner Contribution Options below.
- Mortgage Reinstatement (One-time Assistance)
Note: If your mortgage delinquency exceeds the $36,000, you may still be able to apply for one-time Reinstatement. See the Homeowner Contribution Options below.
Homeowner Contribution Options
There may be homeowners who would otherwise qualify for assistance except for amount limitations on program funds. If such a homeowner has the ability to close this gap with alternate funds, he will be allowed to do so as outlined below:
For example, if a borrower were 7 months delinquent and had the means to pay one month of mortgage expenses (to reduce the delinquency to 6 months) he would be permitted to do so by providing certified funds at closing. The source of the funds would have to be discussed in the Hardship Affidavit and documented by the RADA Housing Counselor prior to MPP loan approval.
The source of the gap funds would have to be discussed in the Hardship Affidavit and documented by the RADA Housing Counselor prior to loan approval.
If you are delinquent on your existing mortgage payments, you must pay the gap amount in certified funds at closing.
If you are current on your existing mortgage payments, you must use verified funds to pay your mortgage expenses directly to your mortgage servicer for the months of shortfall, or gap, until the MPP assistance begins.
The source of the gap funds would have to be discussed in the Hardship Affidavit and documented by the RADA Housing Counselor prior to loan approval.
- Job Search Assistance Homeowner Contribution Option
For example, if a borrower were 7 months delinquent and had the means to pay one month of mortgage expenses (to reduce the delinquency to 6 months) he would be permitted to do so by providing certified funds at closing. The source of the funds would have to be discussed in the Hardship Affidavit and documented by the RADA Housing Counselor prior to MPP loan approval.
- Job Training Assistance Homeowner Contribution Options
The source of the gap funds would have to be discussed in the Hardship Affidavit and documented by the RADA Housing Counselor prior to loan approval.
If you are delinquent on your existing mortgage payments, you must pay the gap amount in certified funds at closing.
If you are current on your existing mortgage payments, you must use verified funds to pay your mortgage expenses directly to your mortgage servicer for the months of shortfall, or gap, until the MPP assistance begins.
- Mortgage Reinstatement Homeowner Contribution Options
The source of the gap funds would have to be discussed in the Hardship Affidavit and documented by the RADA Housing Counselor prior to loan approval.
