News

Mortgage grants available through VHFA

By Jason Starr

Observer staff

A mortgage assistance program set up though the federal CARES Act and Vermont Legislature is offering up to three months of mortgage payments free to homeowners in financial trouble due to the coronavirus pandemic. 

The Vermont Housing Finance Agency is administering the $5 million grant program. 

Applications are due by the end of August, but that may be extended, as the agency has had fewer applications than it anticipated since the launch of the program in early July. 

“We were expecting there to be a flood of applications, and it has been much slower than I imagined,” VHFA Executive Director Maura Collins said. 

A federal unemployment insurance boost of $600 per week has cushioned the economic fallout of the pandemic for the newly unemployed. But that benefit expires this week. 

“It is still early in the fallout of all of this,” Collins said. “Maybe the real economic need will be this fall and winter.”

The agency estimates that about 10 percent of mortgage holders in Vermont have requested forbearance from their lenders. That means attaching missed payments to the end of a loan term, or creating a monthly repayment plan for missed payments. But it’s unclear how many borrowers who have requested forbearance have actually missed a payment, Collins said. 

“It’s critical that we keep moving forward and fighting this virus, and I understand recovery starts with everyone having a safe and secure place to call home,” Gov. Phil Scott said. “I’m pleased to see the launch of the mortgage assistance program, which will be an important resource for keeping Vermonters in their homes.”

Only mortgages for homes used as primary residences, those started before March 1, 2020 and those held by Vermonters who meet income limits and have missed at least two payments will be considered for assistance through the program. The income cap in Chittenden County is $6,000 per month. 

VHFA will prioritize those with the lowest income who are most at risk of foreclosure when awarding grants. Payments will be made directly to lenders on behalf of homeowners.

“VHFA is applying the full force of its decades of experience working with mortgage servicers and homeowners to implement this program,” Collins said.

Application materials are available at www.vhfa.org/map or by calling 1-800-889-2047.