The California Housing Finance Agency (CalHFA) says it will develop initiatives to use nearly $700 million in new federal funding to help borrowers who are struggling with mortgage payments.
This follows an announcement by the Obama administration that CalHFA is one of five state housing finance agencies slated to receive a total of $1.5 billion from the federal government's Emergency Economic Stabilization Act of 2008. In addition to California, the funds will support efforts in Arizona, Florida, Michigan and Nevada. All five states have seen average home prices decline by 20% or more.
Steven Spears, acting executive director of CalHFA, says the agency will work quickly to develop programs to help California's low- and moderate-income homeowners and submit plans to the federal government by April 16, adding that he expects the program to be ready to be implemented by midyear or sooner.
"This funding alone will not solve the significant problems in the housing market that California families face, but combined with other initiatives by state, local and federal governments, as well as the private sector, this will contribute to stabilizing California's housing market," Spears says.
According to a FAQ document posted on the CalHFA Web site, $699.6 million will go to California, $418 million will go to Florida, $154.5 million will go to Michigan, $125.1 million will go to Arizona and $102.8 million will go to Nevada.