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Federal money to help N.C. jobless dodge foreclosure

With North Carolina suffering from some of the worst unemployment rates in the country, the U.S. Treasury Department is dedicating $159 million to help laid off workers in the state avoid foreclosure.

Another $121 million is likely on the way, according to Margaret Matrone, communications director for the N.C. Housing Finance Agency.

Over the next three years, federal dollars will help 7,200 jobless people statewide keep up with mortgage payments while they seek new jobs or train for a career switch.

“It will help stabilize property values in their neighborhoods by reducing the number of foreclosure sales,” said A. Robert Kucab, executive director of the N.C. Housing Finance Agency.

The federal assistance has only been made available to the 17 “hardest hit states” that are suffering from high unemployment rates and dismal housing markets.

In 2009, about a quarter of the state’s population lived in a county with an unemployment rate of 12 percent or higher. North Carolina suffered the loss of 278,000 jobs between 2007 and 2009.

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The Hardest Hit program will be made available in Haywood, Jackson, Macon and Swain counties only in December.

Most of the allocated money will cover entire mortgage payments for the unemployed, while the remainder will refinance loans to reduce monthly bills. Residents in 50 struggling counties in North Carolina, including Swain County, will qualify for additional financial assistance.

With the Hardest Hit program, the unemployed may be eligible for 24 months of mortgage payments up to $24,000 in most counties. Those who reside in the 50 high unemployment counties in North Carolina could receive 36 months of mortgage payments up to $36,000.

The North Carolina Housing Finance Agency, which will administer the federal program, already offers similar assistance to the unemployed.

Unlike other states, North Carolina already has experience running a similar program. The state Home Protection Program helps struggling workers pay their mortgages through interest-free loans for up to 15 years.

However, Matrone points out that it will be much easier to qualify for the federal program. Also, those who receive Hardest Hit assistance won’t have to pay back anything if they don’t move from their house for at least 10 years.

But Matrone suggests that North Carolina residents struggling to keep up with house payments should not wait till December to seek assistance.

“If you’re on the verge of foreclosure now, it’s much better to go ahead and use the program that’s available,” said Matrone.

For more information, contact On Track Financial Education and Counseling Services in Asheville at 828.255.5166 or 800.737.5485.

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