The Indiana Lieutenant Governor announced Wednesday the state would be expanding a fund aimed at helping Hoosiers avoid foreclosure.
The state is expanding the Hardest Hit Fund, which the U.S. Department of Treasury established to help unemployed Hoosiers pay their mortgage.
Homeowners now can quality for up to $30,000 instead of $18,000. They can also receive help for a full two years instead of 18 months.
More people can qualify based on the hardships they have faced including an involuntary and substantial reduction in employment income, a substantial reduction in household income due to death of a household, medical procedures or military service.
“When families lose their homes, communities and businesses suffer as well,” Lt. Governor Sue Ellspermann said in a press release. “Indiana’s expansion of the Hardest Hit Fund program will provide assistance to even more Hoosiers who are directly affected by the recession, allowing them to remain in their homes with mortgage, refinancing or transition assistance.”
In Lawrence County nearly one in every 540 homes in foreclosure, putting the county among the highest in the state.
Bedford RE/MAX Real Estate Center Owner Barbara Wright says many people have been negatively affected by layoffs over the past five years.
“As you see this house behind me is one that is on the short sale list and this home and this neighborhood, which is $350,000 average in this neighborhood, people have just been unfortunate in losing jobs.”
But Indiana University Center for Real Estate Studies Director Doug McCoy says programs such as the Hardest Hit Fund often sound great, but they do not produce the desired results.
“What we hear in a broad sense is that we are doing something to help those that are in need, but when we get down to the practical matter, it can be a very narrow group that we’ve made aware and that actually meet the criteria,” he says.
Back in Lawrence County, Wright says she did not know about the program, and if she does not know about it, she doubts homeowners do either.
Still, McCoy says one new requirement that could significantly help is recipients must now complete a financial literacy education course. McCoy says this could help because many people fall into foreclosure because they do not have a good understanding of money management and mortgage contracts.
Indiana has the 13th worst foreclosure rate in the nation, according to statistics from RealtyTrac, although analysts have said the state entered the housing market downturn earlier than the rest of the nation, meaning it will likely also recover sooner than other states.
The state estimates the expanded fund will benefit about 10,150 Hoosiers.
See the information below for a county-by-county breakdown of foreclosure rates in the state.