Kentucky Mortgage Assistance for Unemployed Homeowners

The Kentucky Unemployment Bridge Program (UBP) provides mortgage payment assistance to unemployed homeowners.

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The Kentucky Unemployment Bridge Program, which is funded through the Hardest Hit Fund, provides mortgage payment assistance to unemployed and underemployed homeowners. Keep reading to get an overview of the program, learn how much assistance is available, and find out if you are eligible.

(To learn about foreclosure procedures in Kentucky, and programs to assist Kentucky homeowners, visit our Kentucky Foreclosure Law Center.)

Hardest Hit Fund

In 2010, the U.S. Department of the Treasury created the Hardest Hit Fund to provide targeted aid to homeowners in those states most affected by the housing market crash. As part of this program, $7.6 billion in aid was allocated to the 18 states, along with Washington, D.C., that experienced the most extreme home price declines and high unemployment rates as a result of the economic crisis.

(Learn more about the Hardest Hit Fund.)

Kentucky was awarded $148 million in funds through the Hardest Hit Fund to help eligible homeowners avoid foreclosure. (Learn more about the Kentucky foreclosure process.) To do this, Kentucky set up the Unemployment Bridge Program (UBP).

The Unemployment Bridge Program

Unemployed and underemployed homeowners who have fallen behind in their mortgage payments can use UBP funds to bring their loan current and cover future mortgage payments. The program will advance an initial payment of up to $12,500 to pay past-due amounts and reinstate the loan, as well as make upcoming payments, though the maximum amount of assistance is limited to:

  • $30,000 per household or
  • 18 months of assistance (whichever occurs first).

How the Program Works

UBP assistance is provided in the form of an interest-free, forgivable loan secured by a junior lien that is recorded against the property. The loan is forgiven over a five-year period at 20% per year. After five years, the subordinate lien will be released. You only need to repay the loan if:

  • you sell the property before the forgiveness period expires and there is sufficient equity to pay all or part of the pro-rated balance of the loan
  • you refinance to consolidate debt or take cash out, or
  • fraud is found.

Borrower Eligibility

To be eligible for UBP assistance, you must meet all of the below criteria.

  • You are a Kentucky resident.
  • You lost your job or had a reduction in employment income due to changing economic conditions, through no fault of your own.
  • Your job loss or reduction in employment income occurred within the three-year period preceding your application for assistance.
  • You are receiving or are eligible to receive unemployment benefits from the state of Kentucky.
  • You can demonstrate a need for assistance. For unemployed applicants, you are considered needing assistance if your PITI (principal, interest, taxes, and insurance) exceeds 31% of your gross monthly income. To qualify based on a reduction in employment income, you must have experienced at least a 15% reduction in income.

Home Eligibility Criteria for UBP

Additionally, your existing mortgages and the property securing the mortgages must meet the below criteria.

  • The property is a single-family home, consisting of no more than one unit. (A condominium unit or townhome also qualifies.)
  • You occupy the home as your principal residence.
  • There are no more than two mortgage liens on the property.
  • Your first and second mortgage unpaid principal balance do not exceed $275,000 (based on the sum of the outstanding mortgages on the property.)
  • The property is not abandoned, vacant, or condemned.

Mobile or manufactured homes are eligible for UBP assistance if permanently affixed and considered to be real property. (You must own both the land and the permanently attached manufactured home.)

Learn more about what happens if you are struggling to pay your mobile home loan.

UBP Exclusions

You are not eligible for assistance through UBP if one of the below conditions applies to you.

  • Your job loss or income reduction was due to divorce, death, or medical reasons.
  • You have been convicted of felony larceny, theft, fraud, forgery, money laundering, or tax evasion in connection with a mortgage or real estate transaction within the last ten years.
  • You filed bankruptcy and the bankruptcy is active. (If you previously filed bankruptcy and it was dismissed or you received a discharge, then you are eligible to apply for the program. However, mortgages that were discharged, rather than reaffirmed, do not qualify for the UBP.)
  • Your cash reserves exceed six months PITI (excluding retirement funds) for the first and second mortgage payments.
  • You own more than one property.

Servicer Participation

Servicer participation in this program is voluntary. (A mortgage servicer is the company that collects monthly mortgage payments from borrowers on behalf of the owner of the loan, as well as tracks account balances, manages the escrow account, handles loss mitigation applications, and pursues foreclosure in the case of defaulted loans.)

If your mortgage servicer has not signed up to participate, then you are not eligible to receive assistance from this program. To find out if your servicer is part of the UBP, go to

How to Apply

To apply for UBP assistance, go to and click on “Get Free Help” to complete an intake form. You will then be referred to a housing counselor. You will also need to go to the website’s “Client Forms” section to print out and complete a loss mitigation package. (To find the loss mitigation package, click on “Full Client Package” at the top of the “Client Forms” page). Once you complete the package, gather information about your mortgage, paystubs, bank statements, and your previous year’s tax returns, and contact the counselor to schedule an appointment.

You can also apply by calling (866) 830-7868 and completing the intake over the phone. You will then receive your loss mitigation package via e-mail or mail. After completing the package and gathering all needed information, call your assigned counselor.

Beware of Scammer Websites

There are a number of scammer websites on the Internet purporting to be Hardest Hit Fund application sites. The Kentucky Housing Corporation is the only agency authorized to administer the UBP in Kentucky. The program is free and you should not pay for any services associated with applying for assistance.

For More Information

Go to and click on “Unemployment Bridge Program” or call (866) 830-7868 for more information.

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