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, North Carolina received over $482 million to provide assistance to homeowners who are struggling to make their mortgage payments due to job loss or other temporary financial hardship. Additional funding was approved in 2016.
Read on to learn about the different types of help available through North Carolina’s Hardest Hit Fund program, called the N.C. Foreclosure Prevention Fund, and find out if you may be eligible for assistance. (To learn more about the Hardest Hit Fund and the various state programs funded by it, visit our Hardest Hit Fund topic page.)
The N.C. Foreclosure Prevention Fund has several programs to assist homeowners who lost jobs or experienced reductions in income through no fault of their own. The programs are:
Assistance is provided in the form of a 0% interest, forgivable loan secured by a junior lien that is recorded against your property. After five years, the loan is then forgiven at 20% per year. After ten years, the lien will be released.
You only need to repay the loan if:
To be eligible for the N.C. Foreclosure Prevention Fund programs, you must meet all of the below criteria.
Additionally, your existing mortgage and the property securing the mortgage must meet the below criteria.
You are not eligible for assistance from the N.C. Foreclosure Prevention Fund if you have been convicted of a mortgage-related felony including larceny, theft, fraud, forgery, money laundering, or tax evasion, within the last ten years.
Program payments are made directly to the mortgage servicer whose 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.)
Go to www.ncforeclosureprevention.gov, then click on “Am I Eligible to Apply?” and then choose the link “Find Out if You Are Eligible For Help From the N.C. Foreclosure Prevention Fund” to complete an initial eligibility questionnaire.
If you are eligible for the program, you can either:
In April 2016, the N.C. Foreclosure Prevention Fund received an additional $224 million in funding. Assistance is provided on a first-come, first-served basis and the program is scheduled to last through 2020.
To learn more about the N.C. Foreclosure Prevention Fund program, call 888-623-8631.
If you are facing foreclosure for any reason (not necessarily related to your employment situation), you can call the State Home Foreclosure Prevention Project at 888-442-8188. This program offers free help, including counseling, assistance in dealing with your servicer, and, in some cases, access to legal services. (Learn more about the North Carolina foreclosure process.)