Mortgage assistance mismanaged in Florida – this is the conclusion of a federal audit, examining the billion-dollar program meant to aid those who risk losing their homes.
The Hardest Hit Fund was established by Congress in 2010 to provide mortgage relief and other financial assistance to struggling homeowners. This was part of a wider effort to bail out the nation’s economy. In the state of Florida, the program is jointly managed by the US Treasury Department and the Florida Housing Finance Corporation.
The audit has determined that the state had only accepted 20% of applications from homeowners who requested assistance, as opposed to the national acceptance rate of 40%. This represents the lowest rate among the 18 states that received funding through the government program.
Furthermore, it was determined that 40% of applicants had withdrawn their requests, largely because of the extensive waiting period (six months) needed to receive assistance. This also constitutes the highest withdrawal rate in the country, out of any state.
“Florida homeowners do not have the same chance of getting foreclosure assistance from the Hardest Hit Fund compared to homeowners in other states, and that is not good enough for an emergency crisis program,” claimed special inspector general Christy Goldsmith Romero.
This is even more troublesome, as the state was the most negatively affected by the foreclosure crisis. Out of the $7.6 billion disbursed nationwide, Florida has received more than $1 billion, yet the state’s performance has consistently lagged well behind those of any other.
The federal audit has recommended to the Treasury Department the implementation of strict standards and firm benchmarks for the entire state of Florida, in dealing with the issue.
The audit is the result of common effort from state representatives and leaders who have complained about Florida’s strict eligibility rules for homeowners in dire need of assistance. It was launched in 2013, immediately following a similar one, which was carried out a year earlier.
Detractors however have disputed the findings, claiming it to be a complete misunderstanding of the Hardest Hit Fund program in its entirety. Critics argue that the federal audit did not take into consideration recent reforms and changes implemented in the system, state-wide. They claim that Florida has given more than $411 million to homeowners battling foreclosure within the last two years alone.
But with countless homeowners affected by the housing crisis state-wide, the federal audit brings along much-needed hope that the system will be improved to better suit their needs.
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