Gov. Jennifer Granholm and the Michigan State Housing Development Authority announced on Wednesday how $154.5m in federal funding would be spent to keep unemployed and underwater borrowers in their homes. The measures include payment assistance, rescue funds for those who have fallen behind, and matching funds to lower the principal. Banks and credit unions would work with borrowers to determine eligibility and best available options. While previous assistance programs — such as loan modifications — have helped some borrowers, they haven’t addressed those who are unemployed or owe more on their homes than what they are worth. The Obama administration announced the program two months ago, saying five states hardest hit by the housing crisis would share $1.5bn in funding.
