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NEW YORK (Reuters) – A new service is helping people in more than 30 states who are facing mounting medical bills or losing homes to the mortgage lender Fannie Mae and Freddie Mac, with help from the U.S. Department of Housing and Urban Development.
The FHA Mortgage Equity Refinancing Toolkit offers a one-stop shop for homeowners to find out if refinancing with the government – a common strategy for people to cope with escalating medical bills – might help them stay in their homes in the long term, said Michael Hettenhaus, director of FHA’s Home Mortgage Program.
The Federal Housing Administration has partnered with the California state government on the effort, Hettenhaus said at a conference on Thursday evening, hosted by the New York Times.
In California, the Home Loan Board offers a variety of refinancing options to homeowners.
Among the features are loan modifications allowing for payment adjustment and down payment assistance, as well as forbearance and loan rehabilitation programs for homeowners who are unable to meet their monthly payments due to medical expenses, Hettenhaus said.
In a statement, California Gov. Jerry Brown said FHA and the state government would provide relief to more than 5.2 million homeowners.
“We are grateful for the housing assistance and assistance that we have been able to provide by working with FHFA, including refinancing,” Brown said.
“It’s important to note that we are not targeting any particular group of people for the government’s assistance,” said Karen Harnett, a spokeswoman for FHFA.
“We’re focusing on borrowers who have difficulty in meeting their monthly mortgage payments,” Harnett added. “We’ve made it easier for them by offering loan modifications and loan rehabilitation.”
The refinancing tool kit will cost about $20 million to develop, according to a Housing and Urban Development spokesman. Hettenhaus said the state will pay about $5