Federal government to investigate Florida’s foreclosure prevention services

Florida may finally be number two nationally in terms of foreclosure rate, but now the $1 billion foreclosure prevention fund known as Hardest Hit is under federal investigation because funds may not be getting to the right recipients, the Palm Beach Post reported.

The special inspector general for the Troubled Asset Relief Program, Christy Romero, joins Florida Senator Bill Nelson in raising concerns about where the money is going and how much has been distributed so far. Romero confirmed her intent to investigate Florida’s use of Hardest Hit funds in a letter today, the Post said.

In a written request for the added scrutiny in March, Nelson said Florida has distributed just 15.7 percent of the state’s $1 billion. The Florida Housing Finance Corporation administers the Hardest Hit program, and it told the Post that some 11,000 applications for assistance are currently pending. About 9,000 Floridians have already received help from Hardest Hit, the Post said.

A year ago, the inspector general criticized Florida’s delays in implementing the program and said the state was not pushing mortgage servicers to participate fully, the Post said. [Palm Beach Post] –-Guelda Voien