Five States Are Approved For Unemployed Loan Program

unemployed loan program

The new lending program performed by the Obama administration has permitted to start the provision of cash advance loans for the unemployed homeowners in order to help them prevent foreclosure. However, this program is available only for five states. The Emergency Homeowners’ Loan Program of $1 billion was maintained as a part of the Dodd-Frank Act, financial reform bill that was enacted last summer.

Delays Hasn’t Prevent The Program From Being Launched

The launch of the program had been put off due to the bureaucratic delays for several months. In fact, it is aimed to help the unemployed homeowners to go on providing payments on their mortgages supplying them with the zero-interest instant cash loans of up to $50,000 which may be forgiven in five years. The five states, including Delaware, Idaho, Connecticut, Maryland and Pennsylvania, were approved for the funding by the Department of Housing and Urban Development.

The Other States Will Also Get Federal Funding

As for the other 27 states which don’t have similar program, they will be provided with the federal funding for such cash advance by NeighborWorks America, the nonprofit network of housing counseling. According to the estimates performed by HUD, over 30,000 homeowners will be able to participate in the program and NeighborWorks America is going to launch the lending program for the rest 27 states in the next few weeks.

The program won’t be provided in some states, like Nevada, California and Michigan, which are already due to get aid through the separate effort of Treasury Department that directs $7.6 billion in order to assist hard-hit states. In spite of the fact that the House voted to stop the unemployment lending program last month, the Senate doesn’t seem to go along.