The Homeowners Assistance Fund (HAF) program, which went into effect with the 2021 passage of the American Rescue Plan Act signed into law by President Joe Biden, will be expanded by the Nevada Affordable Housing Assistance Corporation (NAHAC) within the state, the organization announced.
The HAF includes $10 billion to be distributed to all 50 states in order to offer services to homeowners who are battling financial hardship as a result of the sprawling impacts of the COVID-19 coronavirus pandemic, and will continue to be available to borrowers of both forward and reverse mortgages.
“The expansion includes the increase of the reinstatement maximum from $35,000 to $50,000,” NAHAC said in a press release announcing the expansion. “The unpaid principal balance must meet the Government Sponsored Enterprises (GSE) conforming loan limit at the time of origination.”
In order to qualify, the delinquent payment (which could include a mortgage payment, property taxes, homeowner’s insurance or HOA fees) must be two or more payments past due, the organization clarified. Contrary to the belief of some, reverse mortgage borrowers qualify for assistance under the provisions of the HAF funding.
“Delinquent household-related expenses may be reinstated regardless of the loan being current, paid off, or if the homeowner has a reverse mortgage (Home Equity Conversion Mortgage [HECM]),” the release specified. “This addition will allow for reverse mortgages and loans that are current or paid off to receive assistance with past due housing-related expenses such as taxes, homeowners’ insurance, and HOA fees.”
The HAF program is available nationally, though the federal government left it up to individual states to get their own programs online. Unfortunately, a sluggish rollout and lacking education on the topic have depressed the potential reach of HAF funds for reverse mortgage borrowers, according to a pair of reverse mortgage servicers who spoke on the topic earlier this year.
Since loan originators often remain the primary point of contact for a borrower for sometimes years after a loan closes, they may be uniquely suited to reach out to their past clients and inform them of HAF availability if they have fallen behind on their applicable taxes or other fees according to Gail Balettie of Celink.
“We have done everything we can possibly think of,” Balettie said in May regarding getting the word out to reverse mortgage borrowers. “I’ve had HAF messaging on my statements since January, we do outbound phone call campaigns, we have it on our website, we do email campaigns, everything other than hiring homing pigeons.”
Visit the website for the recently-expanded Nevada program.
