In 2010, the U.S. Department of the Treasury created the Hardest Hit Fund to provide targeted aid to homeowners in those states, including Kentucky, most affected by the housing market crash. Kentucky initially received $148 million to provide assistance to homeowners struggling to make their mortgage payments and established the "Unemployment Bridge Program." Further funding was approved in 2016.
While the Hardest Hit Fund states have through 2020 to utilize their funds, the Unemployment Bridge Program’s reservation window closed on July 31, 2018. Because there's a possibility that the program could reopen, and for informational purposes as well, here's a brief rundown of the Unemployment Bridge Program. (Other states also closed their Hardest Hit Fund programs early when funding ran out, but reopened them when more money became available.)
Under Kentucky’s “Unemployment Bridge Program,” eligible unemployed and underemployed homeowners—or people who have a qualifying disability—who’ve fallen behind in their mortgage payments can get up to $15,000 to reinstate (get current on) a delinquent loan and cover future mortgage payments.
The program will pay the overdue amount—including late fees, interest, taxes, insurance, and costs—and pay for up to 12 months of future mortgage payments. If the entire $15,000 goes towards catching up on the loan, you won’t qualify for help with your monthly mortgage payment going forward. But if you don't use the full amount to reinstate, any remaining amount may be put towards monthly mortgage payments for as many as 12 months or until you reach the maximum assistance amount.
The Unemployment Bridge Program provides assistance in the form of a 0% interest, forgivable loan secured by a junior lien that is recorded against the property. You need to repay the loan only if:
To qualify for the Unemployment Bridge Program, you must meet one of the following criteria.
Also, all applicants have to show they need assistance by having at least a 15% reduction in current income as compared to previous income.
Additionally, you, your existing mortgages, and your savings must meet the below criteria.
You’re not eligible for assistance if one of the below conditions applies to you.
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 Unemployment Bridge Program.
The program is free, and you should not pay for any services associated with the program.
Go to the Kentucky Homeownership Protection Center’s website and click on “Unemployment Bridge Program” or call 866-830-7868 for more information.
For information about Kentucky foreclosure procedures or to find out about possible defenses to a foreclosure, consider talking to a local foreclosure attorney. If you want to learn about different ways to avoid a foreclosure, like with a loan modification, talk to a HUD-approved housing counselor. (Learn about using a HUD-approved housing counselor.)
Updated October 3, 2018