If you’re facing a foreclosure in Kentucky, you might be eligible to receive money from the state’s Unemployment Bridge Program, funded through the federal Hardest Hit Fund. This program gives mortgage payment assistance to unemployed and underemployed homeowners, as well as those who have a long-term or permanent disability.
Keep reading to get an overview of the program, learn how much assistance is available, and find out if you’re potentially eligible.
In 2010, the U.S. Department of the Treasury created the Hardest Hit Fund to give aid to homeowners in those states most affected by the foreclosure crisis. As part of this program, the government allocated $7.6 billion to 18 states, including Kentucky, 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 federal Hardest Hit Fund.)
Initially, Kentucky received $148 million in funds through the Hardest Hit Fund to help eligible homeowners avoid foreclosure. More funding came through in 2016.
To help homeowners save their home from foreclosure, Kentucky set up the Unemployment Bridge Program. (To learn about foreclosure procedures in Kentucky, see our Summary of Kentucky’s Foreclosure Laws.)
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.
To apply for assistance from the Unemployment Bridge Program, go to the Kentucky Homeownership Protection Center’s website and click on “Get Free Help” to complete an intake form.
You can also apply by calling 866-830-7868.
The Unemployment Bridge Program is scheduled to stop taking applications after July 31, 2018.
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 applying for assistance.
Go to the Kentucky Homeownership Protection Center’s website and click on “Unemployment Bridge Program” or call 866-830-7868 for more information. Free foreclosure counseling is also available from the program.
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.)