by Victor Skinner
Pennsylvania has launched a new $350 million program designed to help homeowners struggling to pay their mortgages because of the COVID-19 pandemic.
Gov. Tom Wolf announced the statewide launch of the Pennsylvania Homeowner Assistance Fund (PAHAF) on Thursday after approval from the U.S. Department of Treasury. The fund utilizes $350 million from the American Rescue Plan Act distributed to Pennsylvania through the treasury’s Homeowner Assistance Fund to help homeowners avoid mortgage delinquencies, defaults and foreclosures, as well as for help paying utilities.
“As we continue to advance our COVID-19 recovery efforts, we must address the rising number of homeowners facing possible loss of their homes and foreclosure – this program will do just that,” Wolf said. “The Homeowner Assistance Fund will prioritize individuals and families with the greatest need, as well as those who are socially disadvantaged. I am grateful that the U.S. Treasury has approved Pennsylvania’s plan, and we can start the new year by distributing this critical funding to homeowners.”
The money is aimed at helping homeowners with incomes at or below 150% of the area median income who are dealing with “unforeseen” financial hardships related to the pandemic.
The Pennsylvania Housing Finance Agency will administer the PAHAF program, with applications available online beginning Feb. 1. The PAHAF website also provides resources for homeowners who may need in-person help to complete the application, according to a Wolf press release.
“To qualify for this assistance, eligible Pennsylvania homeowners must have experienced a reduction of income or increase in living expenses due to the COVID-19 pandemic after January 21, 2020 (including a hardship that began before Jan 21, 2020 but continued after that date),” the release read. “They also must currently own and occupy their home in Pennsylvania as their primary residence. In addition, the program has specific income requirements to be eligible.”
The relief comes as millions of Americans face foreclosures after the end of a moratorium on foreclosures of federally backed mortgages last year. The Biden administration extended forbearance options for the government-backed loans through the end of September, while the Consumer Financial Protection Bureau urged lenders to postpone foreclosure proceedings until 2022.
Foreclosures initially spiked in October as federal foreclosure protections expired, then declined in November, though Pennsylvania was among the top states for completed foreclosures that month, according to a U.S. Foreclosure Market Report by ATTOM Data Solutions, a company that tracks foreclosures.
PAHAF assistance programs include mortgage reinstatement assistance, forward mortgage payment assistance and assistance for housing property changes and utility payments to avoid displacement. Funds will be distributed directly to mortgage lenders, services, utility providers and other third parties, not to homeowners.
“Our mission is to help Pennsylvanians achieve housing stability despite the many hardships faced during these uncertain times,” PHFA Executive Director Robin Wiessmann said. “PAHAF will provide critical support to eligible Pennsylvania homeowners, allowing families to recover and helping communities overcome the devastating financial and economic impacts of the pandemic.”
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Victor Skinner is a contributor to The Center Square.
Photo “Davis and Kara Buy a House” by Nan Palmero. CC BY 2.0.
