Illinois Housing Task Force Foreclosure Working Group Final Report

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Illinois Housing Task Force

Foreclosure Working Group

Final Report

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Contents Introduction ... 3 Summary of 2013 Activity ... 3 Market Analysis ... 4 Introduction ... 4 Delinquency Rates ... 4 Completed Foreclosures ... 6

Median Sales Price ... 8

Negative Equity Loans ... 9

“Zombie” Properties ... 11

“Zombie” Properties, continued ... 12

Directory of Resources and Programs ... 13

Housing Counseling ... 13

Cook County Mortgage Foreclosure Mediation Program ... 13

Will County Foreclosure Mediation Program ... 13

Illinois Foreclosure Prevention Network ... 13

National Foreclosure and State Payment Settlements ... 14

National Foreclosure Mitigation Counseling Program ... 15

Programs ... 15

Making Home Affordable ... 15

Shared Appreciation Modification Program (SAM) ... 18

Hardest Hit Fund ... 20

Innovative and Ongoing Resources ... 22

Land Banking (Cook County, South Suburban) ... 22

Highland Park Community Land Trust ... 22

Affordable Housing Planning and Appeal Act ... 23

Abandoned Properties Program... 23

Blight Reduction Program ... 24

Single Family Owner Occupied Housing Rehabilitation Programs ... 24

Homebuyer Assistance Programs... 28

Keep Chicago Renting Ordinance ... 33

Final Recommendations and Conclusions ... 34

Conclusions on Market Analysis ... 34

Delinquency Rates ... 34

Sales Price ... 34

Negative Equity Share ... 35

Zombie Properties... 36

Best Practices and Final Recommendations ... 37

Detroit Vacant Property Campaign ... 37

Foreclosure Mitigation Counseling ... 38

Appendix ... 40

State Payment Settlement Fund Awards ... 40

State Payment Settlement Fund Awards, continued ... 41

Abandoned Residential Property Program Recipients and Grant Amounts ... 42

Members of the Illinois Housing Task Force Foreclosure Working Group ... 43

Members of the Illinois Housing Task Force Foreclosure Working Group, continued ... 44

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3 Introduction

The Illinois Housing Task Force formed the States’ Foreclosure Working Group (FWG) at the request of the Illinois General Assembly in May of 2011, with passage of Senate Joint Resolution 30. Duties of the FWG include: monitoring Illinois housing problems and making recommendations, overseeing actions and activities that prevent foreclosures, providing insight about the rebuilding process caused by the housing crisis, monitoring foreclosure activity, and recommending outreach and counseling programs and procedures. The Working Group was made up of public, private, and not-for-profit housing industry stakeholders who have provided their expertise in areas of housing counseling, housing finance, housing development, and more. The Working Group’s first meeting was held September 28, 2011, and since that time has provided foreclosure prevention and mitigation recommendations to agencies and organizations throughout Illinois. This document will be the Final Report of the Illinois Housing Task Force - Foreclosure Working Group, and will summarize Illinois’ current housing market, include an in-depth directory of programs and resources available to Illinoisans, and provide comprehensive recommendations for the state.

Summary of 2013 Activity

The Foreclosure Working Group held a meeting in June of 2013 to steer the group’s Year Two activities. In Year One, the Foreclosure Working Group focused on examining foreclosure prevention and mitigation activities in Illinois and other states; highlighting best practices in its Year One Report. At the conclusion of the June 2013 meeting, the group agreed that Year Two activities be focused on four issues:

1. Monitoring the implementation of current and new foreclosure prevention and mitigation programs, such as Public Act 097-1164 (SB0016 Enrolled) 20ILCS 3805/7.30 (which established a foreclosure prevention counseling and an abandoned property program), and the Cook County Land Bank;

2. Strategizing product solutions for the different issues that current and prospective homeowners are confronting (e.g. principal reduction, underwater mortgages, rate resets, “streamlined” refinancing, and reverse mortgages);

3. Identifying best practices to address the effects that delinquent escrows have on homeowners who attempt to obtain loan modifications; and

4. Identifying possible priority areas for new resources (e.g., National Mortgage Settlement State funds, Foreclosure Prevention Program, Abandoned Property Program).

As a precursor, the Working Group conducted preliminary research on Illinois’ housing market to better understand the overall market, where need continues to exist, and the impact of current foreclosure prevention and mitigation programs. Some results from this preliminary market research showed that from April 2012 to April 2013 both nationwide and in Illinois, there was an increase in building permits, especially of multi-family developments. From April 2012 to April 2013, sales of both new and existing homes increased (National Association of Home Builders), and during that same time, homeownership rates showed slow increases, and vacancy rates showed slow decreases (United Stated Census Bureau: Housing Vacancies and Homeownership). Additionally, increases in property taxes have possibly contributed to households with delinquent escrow and subsequent foreclosures. This preliminary research has encouraged the Working Group to develop a more concentrated market analysis, specifically examining distress, equity, and sales indicators commonly used in market analyses as a part of its Final Report in order to highlight the State’s accomplishments and provide for further recommendations.

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4 Market Analysis

Introduction

As aforementioned, in 2013 the Foreclosure Working Group concentrated its efforts on examining Illinois’ current housing market in order to further steer its Year Two priorities. In an effort to expand on this preliminary work, a more concentrated housing market analysis was conducted and focused on three housing indicators often used in foreclosure and housing market analyses: (1) distress indicators (delinquencies and completed foreclosures), (2) sales (median sales prices), and (3) equity (i.e. negative equity loans, or mortgages whose debt is greater than the current home value). For each of these indicators, data was collected dating back to 2009 for all (102) counties in Illinois. The following sections summarize national and statewide trends by indicator.

Delinquency Rates

In August of 2013, the Mortgage Bankers Association (MBA) published a press release titled Mortgage Delinquencies, Foreclosures Continue to Drop, which reported on both judicial and non-judicial foreclosure states. Judicial foreclosure states are those which during the foreclosure process require court intervention, and can take up to 700 days to complete. There are approximately 20 judicial foreclosure states in the U.S; Illinois being one of them. On the other hand, non-judicial foreclosure states do not require court intervention and have a much faster foreclosure transfer rate from the time a homeowner receives their Notice of Default to the time they receive their Notice of Sale.

The report notes “states with a judicial foreclosure system continue to bear a disproportionate share of the foreclosure backlog. While the percentage of loans in foreclosure dropped in both states with judicial systems and states with non-judicial systems, the average rate for judicial states was 5.59 percent, triple the average rate of 1.86 percent for non-judicial states. Both declined to recent lows, with judicial states seeing the lowest foreclosure inventory since 2009 and non-judicial states seeing the lowest foreclosure inventory since 2007”. Along these trends, Illinois has seen steady drops in its delinquency rates since 2009/2010, the height of the foreclosure crisis. The following charts highlight the state’s average delinquency rate by calendar year (2009 – 2013) and the ten counties in the state with the highest average delinquency rate by calendar year.

Illinois – Average Delinquency Rate (2009 – 2013)

YEAR Delinquency Rate

2009 4.40%

2010 5.06%

2011 5.03%

2012 4.98%

2013 4.39%

Average Delinquency Rate (90+ Day)

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5 Illinois – Top Ten Counties with the Highest Average Delinquency Rate (2009 – 2013)

Count County Average Delinquency Rate

1 Cook 9.3% 2 Boone 9.2% 3 Kendall 8.2% 4 Kane 8.0% 5 Stark 7.6% 6 Will 7.5% 7 Alexander 7.0% 8 Mason 6.5% 9 Saint Clair 6.5% 10 Iroquois 6.4%

1 Cook 11.9% 2 Boone 11.2% 3 Kane 10.6% 4 Kendall 10.6% 5 Will 9.8% 6 Lake 8.2% 7 Stark 8.1% 8 McHenry 8.0% 9 Grundy 8.0% 10 Mason 7.8%

1 Cook 11.8% 2 Boone 11.1% 3 Kendall 10.6% 4 Kane 10.5% 5 Will 9.9% 6 Lake 8.8% 7 McHenry 8.5% 8 Mason 8.3% 9 Winnebago 8.2% 10 Alexander 8.0%

1 Cook 11.7% 2 Kendall 10.9% 3 Boone 10.8% 4 Kane 10.4% 5 Will 10.0% 6 Alexander 9.1% 7 Lake 9.0% 8 McHenry 8.7% 9 Winnebago 8.5% 10 Grundy 7.9%

1 Cook 9.7% 2 Alexander 8.8% 3 Will 8.5% 4 Kendall 8.4% 5 Kane 8.1% 6 Boone 8.0% 7 Winnebago 7.5% 8 Mason 7.2% 9 Lake 7.2% 10 McHenry 7.2% 2012 2013

Delinquency Rate

(10 counties with the highest average delinquency rates by calendar year)

2010

2011 2009

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6 Completed Foreclosures

Since the recognition of the financial crisis in September 2008, approximately 5 million foreclosures have been completed nationally (CoreLogic National Foreclosure Report, April 2014). As of March 2014, the national foreclosure inventory was 1.8 percent compared to 4.4 percent in March 2013. Over the past 12 months (as of April 2014), completed foreclosures fell to 599,000, the lowest level since 2007. CoreLogic reports “at the current pace of completed foreclosures, and given the current foreclosure inventory, it will take 14 months to move all of the foreclosed inventory through the pipeline” (CoreLogic National Foreclosure Report, April 2014).

Concerning Illinois, as of March 2014, 2.6 percent of homes were in foreclosure, compared to 4.4 percent in March 2013 (CoreLogic National Foreclosure Report, April 2014 and March 2013). The following charts display trends for total completed foreclosures, as well as trends for the 10 Illinois counties with the highest number of completed foreclosures. Unsurprisingly, the largest portions of completed foreclosures take place in counties with the largest populations and therefore more housing units; however, the majority of these counties are seeing decreases in the total amount of completed foreclosures.

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7 Illinois – Top Ten Counties with the Highest Number of Completed Foreclosures (2009 – 2013)

Count County Completed Foreclosures % of Total Statewide Foreclosures

1 Cook 11106 39.8% 2 Will 3114 11.2% 3 Lake 2278 8.2% 4 DuPage 1942 7.0% 5 Kane 1748 6.3% 6 Winnebago 1081 3.9% 7 McHenry 983 3.5% 8 Madison 701 2.5% 9 Kendall 637 2.3% 10 Macon 393 1.4%

1 Cook 17080 44.8% 2 Will 4534 11.9% 3 Lake 2618 6.9% 4 DuPage 2407 6.3% 5 Kane 2190 5.7% 6 Winnebago 1243 3.3% 7 McHenry 1101 2.9% 8 Kendall 829 2.2% 9 Madison 755 2.0% 10 Saint Clair 748 2.0%

1 Cook 11199 42.5% 2 Will 3037 11.5% 3 Lake 1919 7.3% 4 Kane 1766 6.7% 5 DuPage 1632 6.2% 6 McHenry 946 3.6% 7 Winnebago 882 3.3% 8 Madison 530 2.0% 9 Kendall 465 1.8% 10 Saint Clair 357 1.4%

1 Cook 16168 37.5% 2 Will 4082 9.5% 3 Lake 3554 8.3% 4 DuPage 3424 7.9% 5 Kane 2898 6.7% 6 McHenry 1831 4.3% 7 Winnebago 1725 4.0% 8 Saint Clair 934 2.2% 9 Kendall 915 2.1% 10 Madison 857 2.0%

1 Cook 8633 30% 2 Will 3961 14% 3 Lake 2486 9% 4 DuPage 2247 8% 5 Kane 2166 8% 6 McHenry 1061 4% 7 Winnebago 834 3% 8 Madison 672 2% 9 Kendall 640 2% 10 Peoria 472 2% 2010 2011 2012 2013 2009 COMPLETED FORECLOSURES

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8 Median Sales Price

CoreLogic reports home prices (including distressed home sales) rose by 10.5 percent in April 2014 compared to April 2013, and expects national home prices to rise by 6.3 percent from April 2014 to April 2015. According to the same report, Illinois’ home prices (including distressed home sales) rose by 9.1 percent in April 2014 compared to April 2013 (CoreLogic Housing Price Index Report, April 2014). The following graph and chart display trends for Illinois total sales and average sales price.

Illinois – Total Sales (2009 – 2013)

Illinois – Average Sales Price (2009 – 2013)

Calendar Year

Average Sales Price

Total Sales

2009

$

107,891

135,406

2010

$

109,121

128,097

2011

$

109,417

126,027

2012

$

114,012

152,499

2013

$

117,127

169,432

Sales Price

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9 Negative Equity Loans

Nationally, at the end of the fourth quarter of 2013, 6.5 million or 13.3 percent of all residential properties with a mortgage were still in negative equity, that is, the value of these homes had fallen below their outstanding mortgages, a likely result of decreased market demand which has been affected by disruptions in the broader economy, such as unemployment. Other possible factors include inaccurate appraisals at the time of loan approval (inflated value), and supply/demand issues related to the volume of foreclosed properties on the market. CoreLogic notes that if home prices increased an additional 5 percent, 1.6 million homes would regain positive equity. At the end of 2013, Illinois and 13 other states had negative equity shares greater than the national average. The following charts trend Illinois’ average negative equity share, negative equity loans, and the negative equity shares for the 10 Illinois counties with the largest percent of negative equity loans.

Illinois – Average Negative Equity Share (2009 – 2013)

Illinois – Total Negative Equity Loans (2009 – 2013)

Calendar Year Average Negative Equity Share 2009 17.36% 2010 19.14% 2011 15.44% 2012 16.41% 2013 15.03%

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10 Illinois – Top Ten Counties with the Highest Number of Negative Equity Loans (2009 – 2013)

Count County % of State Negative Equity Loans Negative Equity Share

1 Cook 50% 29% 2 Will 9% 27% 3 Lake 8% 24% 4 Kane 7% 30% 5 DuPage 6% 14% 6 McHenry 5% 28% 7 Kendall 2% 42% 8 Winnebago 2% 14% 9 Saint Clair 2% 18% 10 Madison 2% 14%

1 Cook 49% 30% 2 Will 9% 30% 3 Lake 8% 25% 4 Kane 7% 32% 5 DuPage 7% 16% 6 McHenry 5% 29% 7 Kendall 2% 44% 8 Winnebago 2% 16% 9 Saint Clair 2% 18% 10 Madison 2% 14%

1 Cook 49% 32% 2 Will 9% 32% 3 Lake 8% 29% 4 DuPage 7% 19% 5 Kane 7% 34% 6 McHenry 5% 33% 7 Kendall 2% 46% 8 Winnebago 2% 16% 9 Saint Clair 2% 22% 10 Madison 2% 16%

1 Cook 49% 33% 2 Will 9% 31% 3 DuPage 8% 21% 4 Lake 8% 28% 5 Kane 6% 33% 6 McHenry 4% 33% 7 Kendall 2% 41% 8 Winnebago 2% 18% 9 Saint Clair 2% 24% 10 Madison 2% 16%

1 Cook 50% 29% 2 Will 8% 25% 3 Lake 8% 25% 4 DuPage 7% 16% 5 Kane 6% 28% 6 McHenry 4% 29% 7 Winnebago 2% 16% 8 Saint Clair 2% 20% 9 Kendall 2% 32% 10 Madion 2% 13% 2010 2011 2012 2013

Negative Equity Loans

(10 counties with the highest percent of negative equity loans by calendar year) 2009

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11 “Zombie” Properties

In January 2014, the Woodstock Institute published a policy brief titled Unresolved Foreclosures: Patterns of Zombie Properties in Cook County. The brief explored unresolved foreclosure properties, what they call “zombie” properties. The report defines zombie properties as those with a foreclosure filing that has not been resolved for more than three years. As neither the borrower nor the servicer has clear control of the property, neither has a strong incentive to assume responsibility for the property and these seemingly abandoned properties can have negative impacts on communities (Cowen, Aumiller pg. 2).

Using foreclosure records from the Circuit Court of Cook County, the report compares foreclosures initiated between 2008 and 2010 with reported sales at auction between 2009 and 2012. With this information, a dataset consisting of properties that had a foreclosure filing between 2008 and 2010 for which there was no sale at auction between 2009 and 2012 was produced. Records from the Circuit Court of Cook County showed that 134,043 foreclosures were filed between 2008 and 2010, with 56,009 (or 42 percent) of these filings sold at auction between 2009 and 2012, leaving 78,034 (or 58 percent) filings with no sale at auction within that same period. Zombie properties or foreclosed properties with no clear entity with control over the property are generally sold at auction. Properties that are sold at auction can be bid on by lenders and citizens alike. Similar to short sales, which are usually sold as-is. When a property is sold at auction, the lender does not make a profit. When the property is sold to the highest bidder, the liens are paid and any overage is given to the homeowner – though typically, once the loans are paid, there is no money left for the homeowner (HomeFinder). Lenders sell static properties at auctions as a way to remove them from their portfolios, as these properties are no longer viewed as an investment to the lender.

Properties which had not been sold at auction were then stratified into quintiles based on a weighted income scale of census tract household income distribution. Five-hundred homes in total were then randomly selected from each quintile in proportion to the share of the overall number of properties that were not sold at auction in each quintile (Cowen, Aumiller pg. 6). The five-quintile breakdown is below:

Status of Foreclosure Filings in Sample, 2009-2010,

Not Resulting in Sales at Auction, 2009-11/30/2013 by Income Quintile

Quintile 1 $0 - $25,490 Quintile 2 $25,491 - $49,013 Quintile 3 $49,014 - $77,539 Quintile 4 $77,540 - $121,689 Quintile 5 $121,690 or more Total Status foreclosed

filings not auctioned # % # % # % # % # % # % Resolved with owner

still in possession 56 40.6 51 37.2 40 38.8 29 36.7 20 46.5 196 39.2 Title transferred 45 32.6 53 38.7 37 35.9 34 43.0 16 37.2 185 37.0

Dismissed and refiled

16 11.6 11 8.0 11 10.7 5 6.3 1 2.3 44 8.8

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12 “Zombie” Properties, continued

The following findings were reported in Unresolved Foreclosures: Patterns of Zombie Properties in Cook County: 1. Many more properties in Census Tracts in the lower-income quintiles had a foreclosure filing and those

properties were more likely to be sold at auction than were properties in Census Tracts in higher-income quintiles.

2. 15 percent of foreclosure filings that did not result in sales at auction were unresolved, with the original filing still pending after more than three years.

3. Servicers were more likely to leave cases unresolved for properties in Census Tracts in the bottom two income quintiles and were more likely to file a new foreclosure action after dismissal of the original filing for properties in the bottom three quintiles.

4. Properties in the bottom three income quintiles were more than 10 percent more likely to become zombie properties than were properties in Census Tracts in the top two quintiles.

5. Servicers leave about 8.7 percent of foreclosure filings unresolved, and the properties most at risk are those located in low-income Census Tracts, which have greater numbers of foreclosure filings. Of the estimated 11,709 zombie properties, 57.5 percent were in the bottom two income quintiles, while about 22.5 percent were in census tracts in the top two income quintiles.

6. Analyzing the ethnic and racial characteristics of the Census Tracts showed that properties in predominantly white Census Tracts (less than 20 percent minority) were less likely to be sold at auction than properties in more heavily minority Census Tracts. A property in foreclosure in a tract that is 80 percent more minority is about eleven percent more likely to be sold at auction than is a property in a tract that is less than 20 percent minority.

7. Servicers are more likely to leave foreclosures unresolved in Census Tracts that are more racially homogeneous, either less than 20 percent minority or more than 80 percent minority or African American, and more likely to file a new foreclosure action for properties in tracts that were majority minority.

8. 20 of the 77 Chicago community areas are estimated to contain more than 100 zombie properties. More information on zombie properties and this policy brief can be found at

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13 Directory of Resources and Programs

Housing Counseling

Cook County Mortgage Foreclosure Mediation Program

The Cook County Mortgage Foreclosure Mediation Program was launched in April 2010 with funding approval by the Cook County Board. The program was designed to provide homeowners with critical support, and help them explore their options to stay in their homes or negotiate respectable exits as early as possible once the foreclosure process began. The program provides legal assistance and housing counseling to homeowners in need. It’s made successful through a partnership between the Circuit Court of Cook County and several State and local organizations (Illinois Housing Development Authority, the Chicago Bar Foundation the Chicago Community Trust, the Center for Conflict Resolution, the Chicago Legal Clinic, and the Chicago Volunteer Legal Services Foundation). IHDA has been the administrator of the helpline and housing counseling portion of the program since the program began and has assisted over 22,500 homeowners with funds totaling $5.1 million. There is no charge to participate in the Cook County Mortgage Foreclosure Mediation Program. For more information on the Cook County Mortgage Foreclosure Mediation Program and to access services visit, http://cookcountyforeclosurehelp.org/.

Will County Foreclosure Mediation Program

In July of 2010, the Will County Twelfth Judicial Circuit created a mandatory Foreclosure Mediation Program for residential owner-occupied properties where the foreclosure was filed after August 1, 2010. The program is funded solely through a $150 filing fee paid by plaintiff’s filing foreclosures. For residential foreclosure cases, plaintiffs must send defendant borrowers a summons form that is approved by the court and includes a notification of the mediation program. The form notifies defendants of pre-mediation conferences, offered weekly, which lenders’ counsels, homeowners, and mediators are required to attend. At the conference, homeowners complete a questionnaire to determine their eligibility for loan workout or modification. A case is eligible for formal mediation if a homeowner's monthly income exceeds his or her expenses. A case may also be eligible for mediation if the homeowner is willing to discuss other alternatives to foreclosure, such as deed in lieu, or sale to a third party.

At formal mediations, lenders are required to send a representative to the conference who has full authority to agree to a loan modification and participate in good faith, or face sanctions from the court. The homeowner must attend or the case will return to trial court, unless the absence was excusable. Excluding written agreements, all written communication held in the mediation conference is confidential and exempt from discovery. For more information, visit http://www.willcountycourts.com/.

Illinois Foreclosure Prevention Network

The Illinois Foreclosure Prevention Network (IFPN), a multi-agency, statewide initiative, coordinated by the Illinois Housing Development Authority, was established in 2012 through from the Foreclosure Prevention Program. The IFPN gathers all resources available to homeowners to ensure that families at risk of foreclosure can access the assistance they need in one location. IFPN offers a free hotline, provides a statewide housing counseling search engine, hosts outreach events across the state to provide free housing counseling services, legal advice, and advice on how to avoid mortgage fraud. The IFPN hotline has received over 144,712 calls and the website has received 869,000 hits. For more information on the Illinois Foreclosure Prevention Network and to access services visit, http://keepyourhomeillinois.org/ or call 855-KEEP-411.

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14 Foreclosure Prevention Program

The Foreclosure Prevention Program (FPP) was established by Section 7.30 of the Illinois Housing Development Act in October 2010 in the Save Our Neighborhoods Act. FPP officially launched in June of 2012. Under the program, 141 grants have been awarded totaling $11,348,627.41 that served 70,753 households through September 2014. FPP is funded through the statewide fee that plaintiffs pay when filing a foreclosure complaint. The program allows for agencies to receive capacity building dollars for uses such as training, foreclosure prevention and pre- and post-purchase counseling.

National Foreclosure and State Payment Settlements

National Foreclosure Settlement Fund

In February 2012, 49 State Attorneys General and the federal government announced a $25 billion joint state-federal settlement with the country’s five largest mortgage servicers (Ally/GMAC, Bank of America, JPMorgan Chase, Citi, and Wells Fargo). In December 2013 the Consumer Financial Protection Bureau (CFPB) and Attorneys General in 49 states and the District of Columbia filed a proposed court order requiring the largest nonbank mortgage loan servicer in the country, Ocwen Financial Corporation, and its subsidiary, Ocwen Loan Servicing, to provide $2 billion in first lien principal reduction to underwater borrowers. The consent order addresses Ocwen’s misconduct during the mortgage servicing process. It also covers two companies previously purchased by Ocwen, Litton Loan Servicing LP (“Litton”) and Homeward Residential Holdings LLC (previously known as American Home Mortgage Servicing, Inc. or AHMSI. Ocwen must also refund $125 million to the nearly 185,000 Ocwen, Litton, and Homeward borrowers who have already been foreclosed. This consent order requires that Ocwen follow servicing standards set up by the 2012 National Mortgage Settlement (NMS) with the five largest banks: Ally/GMAC, Bank of America, Citi, JPMorgan Chase, and Wells Fargo.

State Payment Settlement Fund

Approximately $105 million of the National Foreclosure Settlement will be distributed throughout the State of Illinois by the Illinois State Attorney General’s Office. In December 2012, the Attorney General’s Office announced a Request For Proposals (RFP) for programs providing housing counseling, mortgage acquisition and restructuring, and/or neighborhood stabilization and revitalization. Up to $70 million was to be distributed to respondents over three years. In July 2013, awards were announced. Illinois Housing Development Authority was to be awarded $2.5 million to invest these funds in housing counseling and redevelopment strategies and capacity building/technical assistance to communities and organizations outside of the Chicago metropolitan area. A full list of the awardees and dollar amounts can be found in the Appendix (State Payment Settlement Fund Awards).

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15 National Foreclosure Mitigation Counseling Program

The National Foreclosure Mitigation Counseling (NFMC) Program was launched in December 2007 with funds appropriated annually by Congress to NeighborWorks, a national non-profit organization, to support the provision of foreclosure intervention counseling services in “areas of greatest need.” NeighborWorks administers a competitive grant application process to distribute funds to State housing finance agencies (HFAs), HUD-approved housing counseling intermediaries, and community-based NeighborWorks member organizations. Grants are also being made to fund legal assistance to homeowners and to train foreclosure counselors.

In March 2014, NeighborWorks announced that $63.1 million was awarded to HFAs, 18 HUD-approved housing counseling intermediaries, and 67 community-based NeighborWorks organizations to provide counseling to families and individuals facing foreclosure. IHDA, the Illinois HFA, was awarded $1.97 million (the third highest State award) for Round 8 of NFMC. IHDA provides funds to sub-grantee partner agencies around the state that provide foreclosure prevention counseling services; and estimates these funds will provide assistance to 7,500 distressed homeowners. For more information, visit http://www.nw.org/network/foreclosure/nfmcp/round8.asp.

Programs

Making Home Affordable

In July 2014, the U.S. Department of the Treasury and the U.S. Department of Housing and Urban Development announced an extension of the Making Home Affordable Program (HAMP) to December 31, 2016 (the program deadline was previously December 31, 2013). The deadlines for the Home Affordable Refinance Program (HARP) and the Streamlined Modification Initiative for homeowners with loans owned or guaranteed by Fannie Mae and Freddie Mac are December 31, 2015. Making Home Affordable offers three programs particularly significant for homeowners facing foreclosure: Home Affordable Modification Program, Home Affordable Unemployment Program, and Home Affordable Foreclosure Alternatives.

Funding

Round Time Period

Money Awarded Number of Agencies Homeowners Served Round 1 June 2008 - April 2009 $1.57M 15 3,858 Round 2 June 2009 - February 2010 $3.08M 26 6,190 Round 3 March 2010 - November 2010 $1.39M 39 3,300 Round 4 December 2010 - June 2011 $1.44M 40 3,912 Round 5 September 2011 - March 2012 $2.27M 35 6,065 Round 6 September 2012 - January 2013 $1.73M 30 4,406 Round 7 August 2013 - June 2014 $2.68M 30 6,775 Round 8 August 2014 - June 2015 (expected) $1.97M 27 7,500 (estimated)

National Foreclosure Mitication Counseling Program (NFMC)

Previous Rounds of Funding

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16 Streamlined Modification Initiative

In March 2013, the Federal Housing Finance Agency (FHFA) announced the Streamlined Modification Initiative. Under this initiative mortgage servicers are required to send homeowners a letter offering a mortgage

modification. The offer includes a reduced mortgage payment based on a fixed interest rate. Additionally, in order to make modifications eligible to a wider range of homeowners, the program does not require borrowers to document hardship or their income to qualify for a Streamlined Modification. This initiative will be in effect until December 31, 2015.

Homeowners eligible for this modification are those whose:

1. Mortgage is owned or guaranteed by Fannie Mae or Freddie Mac; 2. Mortgage is delinquent for 90 (3 months) to 720 days (2 years); 3. Mortgage has a first-lien that is at least 12 months old; and 4. Loan to value ratio is equal to or greater than 80 percent. For more information on the Streamlined Modification Initiative, visit;

http://www.freddiemac.com/singlefamily/service/streamlined_modification.html.

Home Affordable Refinance Program (HARP)

The Home Affordable Refinance Program (HARP) was established in 2009 to assist homeowners unable to access a refinance due to a decline in their home value. HARP is available to homeowners who are not behind on their mortgage payments but are unable to get traditional refinancing because the value of their home has declined. HARP is designed to help homeowners get new, more affordable, and more stable mortgages. The Federal Housing Finance Agency (FHFA) reported that as of May 2014, HARP has assisted 3,171,138 homeowners nationally. In 2013, approximately 30 percent of total refinances in the State of Illinois were through HARP. Nationally, in 2013, HARP accounted for approximately 23 percent of total refinances (Refinance Report May 2014). Eligible homeowners include those whose:

1. Mortgage is owned or guaranteed by Freddie Mac or Fannie Mae;

2. Mortgage has been sold to Fannie Mae or Freddie Mac on or before May 31, 2009; 3. Current loan-to-value (LTV) ratio is greater than 80 percent; and

4. Mortgage is current at the time of refinance, with an acceptable payment history for the past year. HARP has been extended through the end of calendar year 2015. Homeowners interested in HARP should contact their mortgage company to see if they are eligible. For more information on HARP, visit;

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17 Home Affordable Modification Program (HAMP)

Home Affordable Modification Program (HAMP) is a federal loan modification program authorized by the Emergency Economic Stabilization Act of 2008. HAMP helps homeowners lower their monthly mortgage payments in order to make them more affordable and sustainable. As of May 2014, and since the program’s inception (2009), approximately 2.2 million homeowners have enrolled in trial modifications, with 1.37 million permanent modifications started. As of May 2014, there are 48,933 active permanent modifications in Illinois. (Making Home Affordable Program Performance Report Through May 2014). HAMP is available to employed homeowners, who:

1. Obtained their mortgage on or before January 2009;

2. Owe up to $729,750 on their primary residence or single unit rental property;

3. Owe up to $934,200 on a 2-unit rental property; $1,129, 250 on a 3-unit rental property, or $1,403,400 on a 4-unit rental property;

4. Own property that has not been condemned;

5. Have a financial hardship and are either delinquent or in danger of falling behind on their mortgage payments;

6. Havedocumented income to support a modified payment; and

7. Have not been convicted within the last 10 years of felony larceny, theft, fraud or forgery, money laundering or tax evasion, in connection with a mortgage or real estate transaction.

HAMP has been extended through the end of 2016. Homeowners interested in HAMP should contact their mortgage company to see if they are eligible. For more information on HAMP,

visit http://www.makinghomeaffordable.gov/programs/lower-payments/Pages/hamp.aspx.

Home Affordable Unemployment Program (UP)

Home Affordable Unemployment Program (UP) assists homeowners experiencing unemployment by reducing their mortgage payments to 31 percent of their income or suspending them altogether for 12 months or more. Since the program’s inception (July 2010) there have been 39,887 UP forbearance plans started, 33,904 forbearance plans with some payment required, and 5,983 forbearance plans with no payment required (Making Home Affordable Program Performance Report Through May 2014). UP is available to homeowners, who:

1. Are unemployed and eligible for unemployment benefits; 2. Occupy the house as your primary residence;

3. Have not previously received a HAMP modification;

4. Have obtained their mortgage on or before January 1, 2009; and 5. Owe up to $729,750 on your home.

Homeowners interested in UP should contact their mortgage company to see if they are eligible. For more information on HAMP, visit http://www.makinghomeaffordable.gov/programs/unemployed-help/Pages/up.aspx.

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18 Home Affordable Foreclosure Alternatives (HAFA)

Home Affordable Foreclosure Alternatives (HAFA) is designed for homeowners who cannot afford their mortgage payments and want to transition to more affordable housing. The program provides two options for transitioning: (1) a short sale or (2) a Deed-in-Lieu of foreclosure. In a short sale, the homeowner’s mortgage company allows the homeowners to sell their house for an amount that falls “short” of the amount they owe. In a Deed-in-Lieu, the mortgage company lets the homeowner give the title back, transferring ownership back to them. Since the program’s inception (November 2012), nationally, HAFA has completed 294,598 transactions (Making Home Affordable Program Performance Report Through May 2014). HAFA offers homeowners the following assistance:

1. Free advice from HUD-approved housing counselors and licensed real estate professionals;

2. Unlike conventional short sales, a HAFA short sale completely releases homeowners from their mortgage debt after selling the property; meaning they will no longer be responsible for the amount that falls "short" of the amount they still owe. The deficiency is guaranteed to be waived by the servicer; 3. A less negative effect on your credit score compared to foreclosure or conventional short sales; and 4. HAFA may provide $3,000 in relocation assistance.

Homeowners interested in HAFA should contact their mortgage company to see if they are eligible. For more information on HAMP, visit http://www.makinghomeaffordable.gov/programs/exit-gracefully/Pages/hafa.aspx.

Shared Appreciation Modification Program (SAM)

Ocwen Financial Corporation initiated a loan modification program designed to help distressed homeowners who owe more than their houses are worth and, at the same time, mitigate the likelihood of rewarding borrower delinquency. Ocwen’s program is called the Shared Appreciation Modification (SAM). The program reduces delinquent customers’ principal owed but also compels them to share some of the appreciation with the mortgage’s owner (not the servicer) if the house increases in value by the time they sell or refinance it. With a SAM, the principle balance of the loan is written down to 95% of the current value of the home. The written-down portion is forgiven in one third increments over 3 years, so long as the homeowner stays current on the modified mortgage. When the house is later sold or refinanced, the borrower must share 25% of the appreciation with the investors that own the loan; borrowers keep 75% of the gain. In calculating the amount of home value appreciation the homeowner gets full credit for all capital improvements made to the property during the term of the SAM. Like all modifications, SAMs help homeowners avoid foreclosure. More importantly they restore equity, which is a significant benefit to the homeowner. Ocwen launched the SAM program in August of 2010 on a pilot program. The initial pilot was very positive with an 80% acceptance rate and only a 2.63% default rate. Ocwen has since ramped up the SAM program nationally. Program data is not currently available for public consumption.

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19 Federal Housing Finance Agency (FHFA) - Neighborhood Stabilization Initiative (NSI)

The Neighborhood Stabilization Initiative (the “NSI”) was jointly developed by the Federal Housing Finance Agency (FHFA), Fannie Mae, and Freddie Mac to stabilize neighborhoods that have been hardest hit by the housing crisis. The program includes two distinct pre-foreclosure strategies and three distinct post-foreclosure strategies, all of which are intended to assist homeowners who are behind on their mortgages, help neighborhoods recover, and reduce the inventory of real estate owned (REO) properties held by Fannie Mae and Freddie Mac. Initial piloting of the program will occur within the city limits of Detroit, Michigan.Chicago, Illinois will be the second city for the federal government's Neighborhood Stabilization Initiative. The NSI program has three primary goals: (1) to increase the number of families able to stay in their current homes through loan modifications, (2) to effectively match distressed properties with responsible non-profits for property renovation and resale; and (3) to assist distressed communities in executing their building demolition plans.

It is hoped that goals one and two will decrease vacant houses by increasing the number of properties occupied by owners or renters. Non-profits may renovate properties for sale to owner-occupants, lease back to current occupants when possible, or lease to other qualified renters. For pre-foreclosure properties, the program will offer incentives to current borrowers and non-profits maximize payment relief and increase chances for current or future occupants to stay in the home. When such efforts are not feasible, the delinquent notes will be conveyed to the National Community Stabilization Trust (NCST) for resolution. For post-foreclosure properties, the program plans to consider an array of neighborhood stabilization options such as donation, demolition, financial incentive mechanisms, repairs, and auctions. The following are pre and post foreclosure strategies that the initiative plans to use.

Pre-Foreclosure Strategies:

 Distressed Region Modification – Borrowers will be evaluated for a new loan modification that provides a greater reduction in monthly principal and interest payments than is available in the traditional loan modification programs.

 Non-Performing Loan Sale/Donation – Severely delinquent low-balance loans secured by distressed properties may be transferred to a non-profit entity for resolution prior to foreclosure.

 Non-profits will work with seriously delinquent owners to determine the most feasible outcome for the household and the property.

 Solutions may include new affordable payment terms, a short sale, a deed-in-lieu of foreclosure, or foreclosure and subsequent repair or demolition, as appropriate.

Post-Foreclosure Strategies:

 NCST Quick Look period – Non-profits will have an opportunity to acquire certain REO properties (occupied or vacant) through purchase or receive properties as a donation prior to the Enterprises initiating their standard disposition processes. NCST will assist the Enterprises with these sales and donations.

 Post-Quick Look – Occupied properties not sold or donated to non-profits during the Quick Look period will be sold at auction; vacant properties and those that do not sell via auction will be prepared for normal a REO sale, which starts with the First Look process, a 20-day period when properties are offered only to owner-occupants, nonprofits, and governmental entities.

 Enhanced First Look Process – Properties will be offered to non-profits through NCST several days prior to being marketed through Multiple Listing Services (MLS). For low-value REO properties, Fannie Mae and Freddie Mac will work with NCST and local community organization to determine the optimum disposition of individual properties, which may result in donation, donation/demolition, or repair/rehabilitation. Discounts and incentives may be offered to non-profits depending on characteristics such as property condition, value, and location.

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20 Hardest Hit Fund

The U.S. Department of Treasury established the Hardest Hit Fund (HHF) in late 2010, providing targeted emergency mortgage assistance through State HFAs to families and persons experiencing unemployment or underemployment. The Illinois Housing Development Authority, the administrator of HHF for Illinois, was awarded approximately $445.6 million from the Troubled Asset Relief Program (TARP) for this program. IHDA established three sub-programs with these funds: the Homeowners’ Emergency Loan Program (HHF-HELP), the Homeownership Preservation Program (HHF-HPP), and the Mortgage Resolution Fund (HHF-MRF). In July 2014 IHDA established a Blight Reduction Program (BRP).

 Homeowner Emergency Loan Program (HELP): IHDA earmarked $317,896,200 to the Homeowner Emergency Loan Program (HELP) to provide temporary mortgage payment assistance to low and moderate-income families who lack sufficient income to support their monthly mortgage payment, or who need help paying off past due amounts. On October 1, 2013, HHF program staff ceased accepting new applications for HHF HELP estimating that there are sufficient applications on hand to fully allocate program funds and meet loan targets of approximately 13,000 households being assisted.

 Mortgage Resolution Fund (MRF): Pools of distressed home mortgages are bought on the private market and evaluated for long-term affordability by a coalition of non-profit organizations, including Mercy Housing, Enterprise Community Partners, National Community Stabilization Trust, and Housing Partnership Network. Eligible mortgagees are offered permanent loan modifications that incorporate principal forgiveness to bring the mortgage in line with the appraised value of the property. Mortgagees who do not meet minimum criteria receive Housing Counseling to discuss exit options including short sale and deed-in-lieu. MRF has recently concluded purchasing loan pools which are currently being reviewed.  Home Preservation Program (HPP): Evolving from a pilot program in late 2012, HPP is a fully operational

program with nine participating servicers who review their portfolios for potentially eligible households and use up to $50,000 to improve the terms of distressed loans through refinance, recast or modification upon approval from IHDA.

 Blight Reduction Program (BRP): On March 27, 2014, the Illinois Housing Development Authority (IHDA) announced plans to pursue establishment of a Blight Reduction Program which will provide up to $35,000 per unit for the demolition, greening, and maintenance of blighted properties in order to stabilize neighborhoods and prevent avoidable foreclosures. IHDA is leveraging up to $30 million of its federal Hardest Hit Fund (HHF) to operate this program. IHDA’s first Request For Applications (RFA) went out in September of 2014.

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County Home Emergency Loan Program Households Assisted Mortgage Resolution Fund Households Assisted Home Preservation Program Households Assisted County Home Emergency Loan Program Households Assisted Mortgage Resolution Fund Households Assisted Home Preservation Program Households Assisted Adams 44 1 Livingston 11 Alexander 3 Logan 8 1 Bond 5 Macon 60 1 Boone 72 Macoupin 26 Brown 2 Madison 230 Bureau 27 Marion 18 Calhoun 1 Marshall 4 Carroll 4 Mason 9 Cass 5 Massac 1 Champaign 63 1 McDonough 9 Christian 26 McHenry 627 Clark 7 McLean 42 1 Clay 11 Menard 4 Clinton 13 Mercer 6 1 Coles 15 Monroe 11 Cook 6404 111 170 Montgomery 29 Crawford 3 Morgan 18 Cumberland 8 Moultrie 8 DeKalb 72 1 Ogle 50 Dewitt 3 Peoria 133 2 Douglas 8 Perry 7 DuPage 766 16 10 Piatt 5 Edgar 7 Pike 10 Edwards 2 Pope 1 Effingham 16 Pulaski 1 Fayette 17 Putnam 1 Ford 2 Randolph 12 Franklin 19 Richland 6

Fulton 8 Rock Island 94 1

Gallatin 2 Saint Clair 258

Greene 2 Saline 9 Grundy 63 1 Sangamon 178 1 Hamilton Schuyler 1 Hancock 3 Scott 3 Hardin Shelby 9 Henderson 3 Stark 5 Henry 18 Stephenson 43 Iroquois 15 Tazewell 43 2 Jackson 13 1 Union 4 Jasper 6 Vermilion 24 1 Jefferson 21 1 Wabash 2 Jersey 10 Warren 4 Jo Daviess 7 Washington 3 Johnson 1 Wayne 3 Kane 394 4 7 White 4 2 Kankakee 112 Whiteside 38 1 Kendall 140 6 6 Will 1077 47 24 Knox 14 2 Williamson 25 La Salle 91 Winnebago 405 3 Lake 587 1 15 Woodford 9

Lawrence 4 Total Households Assisted 12762 185 257

Lee 35 Total Funds Dispersed $228,003,296 $16,117,553 $11,050,993

Illinois Hardest Hit Fund

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22 Innovative and Ongoing Resources

Land Banking (Cook County, South Suburban)

A number of Illinois Housing Task Force members have been involved in the creation and initial planning for two land banks in the Chicago metropolitan area: the Cook County Land Bank Authority, and the South Suburban Land Bank and Development Authority. These entities were created to acquire, maintain, and build or rehabilitate abandoned properties in communities affected by property abandonment and/or which desire to develop affordable housing. After properties are rehabilitated, they are sold with deed restrictions attached, and profits are recycled to repeat the process.

In July 2013, the Cook County Land Bank Authority was awarded $6 million by the Attorney General’s Office from the $70 million National Foreclosure Settlement to support its community revitalization efforts, assist in the start-up of its land bank, and sstart-upport the already existing South Suburban Land Bank. The Cook County Land Bank Authority received $250,000 and municipalities in the South Suburban Land Bank Authority received an aggregate of $550,400 from IHDA through the Abandoned Residential Property Program to secure, maintain or demolish abandoned properties. The two land banks will support municipalities in bringing vacant, abandoned, and foreclosed properties back to productive uses. Both the Cook County Land Bank Authority and South Suburban Land Bank and Development Authority are partnering with several municipalities to coordinate rebuilding efforts. For more information on the Cook county Land Bank Authority and the South Suburban Land Bank and Development Authority visit http://www.cookcountylandbank.org/ and http://www.sslbda.org/, respectively.

Highland Park Community Land Trust

Community Partners for Affordable Housing (CPAH) is a private, not-for-profit which operates Highland Park’s Community Land Trust, with a mission to provide affordable housing to its residents by preserving and developing affordable housing. Illinois’ first community land trust, CPAH purchases properties from what is available in the private market, retains ownership of the land, and sells these residences at affordable prices to income-qualified buyers while leasing them the land, for an affordable fee ($25) per month. If residents of these units choose to move, the property is either sold back to the community land trust or to an income-qualified buyer at a formula that keeps the home affordable. Holding the property in a community land trust counters increasing housing costs that are driven by appreciating land values, while preserving existing affordable housing stock. For more information on Highland Park’s Community Land Trust, visit http://www.cpahousing.org/.

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23 Affordable Housing Planning and Appeal Act

The Affordable Housing Planning and Appeal Act addresses affordable housing production in communities (municipalities with populations over 1,000, and counties) throughout the state by encouraging communities with less than 10% affordable housing stock (known as ‘non-exempt’ communities) to participate in activities that promote affordable housing in their communities; beginning with requiring them to create an affordable housing plan. While there are no major enforcement processes in this law, it codifies the State’s intent in promoting the encouragement of affordable housing. The law established the State Housing Appeals Board (SHAB), appointed by the Governor, which is responsible for hearing appeals from developers who feel that one of their development proposals has been unfairly denied, or unreasonable conditions were placed upon the tentative approval of the development to make it economically unfeasible to carry out by a non-exempt local government.

With amendments (August 2013) to the AHPAA, IHDA, the administering agency is now able to publish a list of non-exempt communities every five years, through the use of the U.S. Census Bureau’s American Community Survey (ACS) data. Prior to these amendments, the AHPAA required the usage of the U.S. Decennial Census. However, some of the data elements used to produce the list using the U.S. Decennial Census are no longer collected through the U.S. Decennial Census, but are reported through the ACS.

Technical assistance is available to non-exempt communities from IHDA and partnering organizations Business and Professional People for the Public Interest (BPI), Metropolitan Mayor Caucus, Chicago Metropolitan Agency for Planning (CMAP), and Metropolitan Planning Council (MPC)), on an ongoing basis. IHDA also developed and issued an AHPAA Handbook which fully describes the program and provides technical assistance to impacted communities. For more information on AHPAA, visit http://www.ihda.org/government/AHPAA.htm.

Abandoned Properties Program

The Illinois Housing Development Authority’s Abandoned Properties Program, which is funded through the Abandoned Residential Property Municipality Relief Fund (ARPMR), was created in 2010 with the passage of the Save Our Neighborhoods Act. Sufficient funds were not generated until the passage of SB16, codified as PA 097-1164 20ILCS 3805/7.31, which changed the formula and foreclosure filing fee. Under this program, monies appropriated from the ARPMR (foreclosure filling fees) are now used by IHDA, the administrator of funds, to make grants to municipalities and counties to secure, maintain, demolish, or rehabilitate abandoned residential properties within their jurisdictions. A maximum grant award of $75,000 per applicant can be awarded to municipalities and counties based on ranked criteria. By statute, allocations will be distributed a follows:

1. 25 percent will be granted in the City of Chicago, 2. 30 percent will be granted in Cook County,

3. 30 percent will be granted in the Collar Counties (DuPage, Kane, Lake, McHenry, and Will), and 4. 15 percent will be granted in other areas of the State.

IHDA accepted first-round applications for the Abandoned Residential Properties Program until December 6, 2013. Ninety two applications were received, requesting $9.5 million. In April of 2014, IHDA announced the awardees. Awardees and award amount are listed in the Appendix,Abandoned Residential Property Program Recipients and Grant Amounts. For more information on the Abandoned Properties Program, visit

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24 Blight Reduction Program

The United States Department of the Treasury allowed IHDA to use up to $30 million of its Hardest Hit Fund balance to demolish vacant properties affected by the foreclosure crisis. The program was announced in July of 2014. These funds will be used to operate IHDA’s Hardest Hit Fund Blight Reduction Program (BRP), with the goal of decreasing preventable foreclosures through neighborhood stabilization, achieved through the demolition and greening of vacant, abandoned, and blighted residential properties throughout the state. These vacant and blighted residential properties will be returned to use through a process overseen by approved units of governments and their not-for-profit partners. Non-profit partners need to be identified to hold title to all properties. Round 1 applications were released in September 2014 and are due to the Authority on December 8, 2014.

Single Family Owner Occupied Housing Rehabilitation Programs

IHDA-HOME Single Family Owner Occupied Rehabilitation Program

A major concern of low-income Illinois homeowners is keeping up with necessary but costly repairs. This is particularly true of older homes. Resources from the HOME Investment Partnership Program (HOME) are used to help low-income homeowners afford these expenses through local governments and non-profit organizations which are funded under the Single-Family Owner-Occupied Rehabilitation (SFOOR) program. SFOOR assistance to homeowners is provided in the form of a deferred, forgivable loan at zero percent interest. If the direct subsidy to the homeowner is less than $14,999, the loan is forgiven over a five year period. If the direct subsidy is between $15,000 and $40,000, the loan is forgiven over a ten year period. Household requirements include:

1. Household income must be at or below 80 percent of the area median income;

2. SFOOR participants must continue to occupy the property to be rehabilitated as their principal residence;

3. The appraised value of a property after rehabilitation must be under the Maximum Appraised Value ceiling set for a given area; and

4. Rehabilitated single-family properties must meet both federal and state standards for repair.

The use of HOME funds carries certain restrictions. If the homeowner moves out or sells the home before the ten year time period has expired, a portion of the HOME funds may need to be repaid by the homeowner. Homeowners must contact one of the SFOOR participating agencies funded by IHDA to apply. For more information on this program and to locate a participating agency, visit

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25 IHDA Trust Fund Homebuyer Rehabilitation Assistance Program

IHDA’s Homebuyers Rehabilitation Assistance Program offers financing from the Illinois Affordable Housing Trust Fund to non-profit organizations and local governments to assist low- and very low-income individuals for acquisition and rehabilitation of vacant properties. Households earning at or below 50 percent of the area median income (AMI) are eligible for a maximum grant amount of up to $5,000. Households earning between 51 percent and 80 percent of the area median income are eligible for a maximum grant of up to $3,000 to purchase a vacant home. Acquisition assistance is provided as a forgivable grant with a five-year recapture period. In addition to acquisition assistance, households may be eligible for up to $20,000 in rehabilitation assistance for eligible home repairs and improvements. Rehabilitation assistance is also provided as a forgivable loan with a five-year recapture period. Basic eligibility requirements include:

1. Property must be a vacant single-family property (mobile homes and properties with more than one unit are not eligible);

2. Household income must be at or below 80 percent of the AMI;

3. Homebuyer participants must occupy the property as their principal residence;

4. Homebuyer must contribute at least $1,000 or 1% (whichever is greater) to the purchase. For more information on this program and to locate a participating agency, visit

http://www.ihda.org/homeowner/granthomebuyer.htm.

IHDA Trust Fund Emergency Home Repairs Program

In September 2013, the IHDA Board approved the first awarding of funds for the Emergency Repair Program. Approximately $5 million in Affordable Housing Trust Fund dollars was awarded to 22 local governments and nonprofit organizations for rehabilitation assistance to assist 206 low-income households. Homeowners may receive up to $20,000 as a forgivable loan to rehabilitate their single-family properties. These funds are generally available to communities not receiving direct HUD funding locally. Subsequent to IHDA’s approval of the program awards, certain areas of Illinois suffered damage from severe storms, straight-line winds and tornadoes in November 2013. IHDA saw the opportunity to use its new program to assist the tornado victims, by increasing not only the amount of assistance, but also the coverage areas.

In December 2013 the IHDA Board approved the Tornado Relief Fund, a subset of the Emergency Repair Program. Two and a half million dollars of Housing Trust Fund monies was reserved for the Fund, to assist low-income homeowners impacted by the November 2013 tornadoes. The following counties have been declared designated tornado affected counties: Champaign, Douglas, Fayette, Grundy, Jasper, LaSalle, Massac, Pope, Tazewell, Wabash, Washington, Wayne, and Woodford. Households in these counties are eligible for assistance through the Tornado Relief Fund. The Tornado Relief Fund will provide emergency rehabilitation assistance to approximately 50-70 low-income affected households. Eligible homeowners will receive up to $40,000 to assist with home repairs caused by tornadoes. Funds may also be used as assistance for homeowner's insurance deductible (minimum of $500). These funds are generally available to communities not receiving direct HUD funding locally. Households must meet the following requirements:

1. Household incomes must be at or below 80 percent of the area median income; 2. Property must have sustained damage due to severe storms;

3. Homeowners must be current on their mortgage payments and the property must be the homeowner's primary residence; and

4. Only single-family properties are eligible for the program.

Homeowners must contact one of the Tornado Relief Program participating agencies funded by IHDA to apply. For more information on this program and to locate a participating agency, visit

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26 IHDA Home Modification Program

Assistance through IHDAs Home Modification Program is available to income-eligible elderly persons and persons with disabilities to modify or repair their homes to improve mobility. Homeowners can receive up to $25,000 in assistance in high-cost metropolitan areas and a maximum of $15,000 in the remainder of the state. Assistance is provided as a five-year forgivable loan. The Home Modification Program is offered through the collaboration of the Authority, the Illinois Department of Human Services and the Illinois Department on Aging in an effort to prevent premature and unnecessary institutionalization of elderly persons and persons with disabilities by funding home repairs in existing housing. Basic eligibility requirements include:

1. Must be an elderly person with a physical limitation or a person with a disability; 2. Must have a documented need for accessibility/mobility modifications;

3. Household income must not exceed 50 percent of the area median income; 4. Home must be an owner occupied residence; and

5. Must be referred to project from an IDHS or IDoA funded service agency.

Homeowners must contact one of the Home Modification Program participating agencies funded by IHDA to apply. For more information about these agencies, visit

http://www.ihda.org/homeowner/documents/TrustFundHomeModContactList.pdf.

Community Development Block Grant (CDBG) Entitlement Communities

Most of Illinois’ Community Development Block Grant (CDBG) entitlement cities and counties receive direct local allocations of HUD funding under this program to operate local housing rehabilitation programs. A list of CDBG entitlement grantees and contact information is located at here;

http://portal.hud.gov/hudportal/HUD?src=/program_offices/comm_planning/communitydevelopment/programs/ entitlement.

Local CDBG Entitlement Grantees/Local HOME Participating Jurisdictions

(PJ’s)

Some of the same cities and counties qualify as HOME participating jurisdictions and receive federal HOME fund allocations directly from the U.S. Department of Housing and Urban Development (HUD) each year. Homebuyers living in these localities should contact a participating jurisdiction directly (however, this does not guarantee these communities have homebuyer programs nor homebuyer resources available). Illinois HOME contacts can be found here http://portal.hud.gov/hudportal/HUD?src=/states/illinois/community/home or contact a participating agency, which can be found here http://www.ihda.org/homeowner/documents/2011-2012HomebuyerContactList-HOMEProgram.pdf.

State CDBG Program/CDAP Housing Rehabilitation Program

The Community Development Assistance Program (CDAP)/Housing Rehabilitation Grant Program assists eligible CDAP Housing Rehabilitation Grant Program local governments in helping homeowners (for non – entitlement areas of the state) in making necessary repairs and improvements to their homes in order to eliminate health and safety problems, correct building code violations, and to preserve the long-term integrity of the units. Housing rehabilitation work is completed by local contractors who have been selected by competitive bid and who meet all insurance requirements. Grant funding is provided to eligible units of general local government through the Community Development Assistance Program which is administered by the Department of Commerce and Economic Opportunity (DCEO). For more information, visit

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27 USDA Rural Development - Section 504 Emergency Home Repair Loan and Grant Program

The USDA-Rural Development’s Section 504 program provides loans and grants directly to very low-income homeowners to repair, improve, or modernize their dwellings or to remove health and safety hazards. Loans of up to $20,000 and grants of up to $7,500 are available. Eligible homeowners must be unable to obtain affordable credit elsewhere and must have very low incomes, defined as below 50 percent of the area median income, and must be 62 years old or older to qualify for grants. They must need to make repairs and improvements to make the dwelling more safe and sanitary or to remove health and safety hazards. A homeowner must reside in a defined rural area and in a community of 10,000 in population or less. For more information about this program and to locate local Rural Development offices, visit http://www.rurdev.usda.gov/HAD-RR_Loans_Grants.html.