The Pennsylvania Housing Finance Agency has provided the state’s Homeowner Assistance Fund Suspend the program so it can manage the distribution of funds on its own, rather than through suppliers.
The action is as follows charge Vendor response times to process payments were slow, partly due to communication issues with service providers. The news was first reported by Spotlight PA, a news outlet backed by a coalition of local publications.
“As part of the transition, third-party vendors will be responsible for fully completing applications that have been partially paid but await additional payment by 31 March 2023. This will allow for a clean transition between systems for audit and control purposes. All Other applications will be processed by PHFA,” the agency said in a release.
In addition to transition work, PHFA’s administration of federal funds allocated at the state level will begin on February 6. It will use a new system and call center to process applications and handle inquiries and information, which will be sent to scheme participants. Existing applicants do not need to start a new application.
“PHFA’s decision to fully administer the program will better leverage the agency’s deep knowledge of the Pennsylvania housing market and its extensive network of mortgage lenders, community partners and housing counseling agencies,” the agency said.
Pennsylvania receives $350 million from the Homeowner Assistance Fund for administration and distribution. The money is intended to help ease the transition of foreclosure-related restrictions put in place during the pandemic to help homeowners weather related hardships. So far, the state has disbursed $89.6 million in funds to homeowners.
Administrative difficulties with the Pennsylvania program sounded alarm bells, pointing to the need to prioritize communications related to the HAF program, not only for those administering it at the state level, but also for cash-strapped mortgage companycan benefit from the funds received when they are used to pay off delinquent loans.
Service personnel have been warned Consumer Financial Protection Bureau and Federal Housing Finance Agency It is their responsibility to ensure that assistance helps homeowners as intended.
This FHAwhich supports loans to particularly vulnerable borrowers with lower incomes, and also suggests that servicers have a responsibility to ensure that HAF relief is applied when needed.
HAF funds are typically used to pay mortgage arrears, but can also be used to pay other housing expenses, such as utilities or taxes.
Complications related to the distribution of HAF funds and communications with mortgage lenders are not limited to Pennsylvania.
A Florida woman recently discovered her servicer hadn’t received some of her HAF payments and later discovered they had been wired to the wrong mortgage company, it is alleged. Orlando-area news outlet WKMG reports.
