The state of Illinois will offer up to $30,000 to homeowners who are behind on their mortgage payments due to COVID-related job losses as it receives funds of $250 million in federal mortgage assistance.
The Illinois Housing Development Authority said it will start accepting applications from homeowners financially impacted by the pandemic in April, Crain’s reported. Once a new round of $250 million in mortgage assistance is made available, the agency estimated about 12,000 Illinois households will be eligible for $30,000 each.
The goal is to keep people in their homes and prevent a new round of new foreclosures following the mid-2000s housing crash, said Kristin Faust, the agency’s executive director.
“We’ve seen before what a housing crisis does,” said Faust. “Not just what it does to the family, but to the block, to the community, to the city.”
More than 16,000 homeowners registered for mortgage assistance information before the agency announced the assistance program, Faust added. More than 41,000 Illinois mortgages were at least 90 days delinquent, according to mortgage data firm CoreLogic in late 2021.
Following the expiration of the moratorium on foreclosures in the fall, about 160,000 Illinois homeowners and renters behind on payments were at risk of losing their homes. Some 5 percent of the state’s home loan holders either faced foreclosure or haven’t made payments, according to a Census Bureau survey from the end of August. Nationally, lenders’ new foreclosure starts surged in January, with about 379,000 residential mortgages past due.
Faust expects the average amount that grant applicants receive to be higher than a 2020 round of mortgage assistance of $9,800 because more time has elapsed and homeowners might have fallen further behind on payments.
To qualify for the mortgage assistance, homeowners must confirm they experienced financial hardship due to the pandemic after Jan. 2020, be at least 30 days late on their monthly housing payments and have a household income at or below 150 percent of the area median income.
The state’s housing agency distributed federal funds totaling more than $100 million in mortgage aid and $900 million in rental aid in its housing assistance programs since 2020.
[Crain’s] – Connie Kim