Homeowner's Emergency Mortgage Assistance Program; Availability of Funds and Restart of Program; Uniform Notice; Current List of Counseling Agencies and Interest Rate for Loans Closed in 2012
[42 Pa.B. 5447]
[Saturday, August 18, 2012]
Under section 409-C of the Housing Finance Agency Law (act) (35 P. S. § 1680.409c), the Executive Director of the Housing Finance Agency (Agency) has determined that the Agency will have sufficient money available in the Homeowner's Emergency Mortgage Assistance Program (HEMAP) Fund to begin accepting and approving applications for emergency mortgage assistance. The Agency is publishing this notice to inform homeowners, mortgagees and mortgage servicers that the Program will begin accepting applications for mortgage assistance and that mortgagees and mortgages shall again be subject to Article IV-C of the act (35 P. S. §§ 1680.401c—1680.412c) and the Agency's Program guidelines in 12 Pa. Code Chapter 31, Subchapter B (relating to policy statement on Homeowner's Emergency Mortgage Assistance Program).
The notice published at 41 Pa.B. 2789 (May 28, 2011) indicated that the Agency projected that funds would be insufficient to allow the Agency to accept new applications for emergency mortgage assistance after June 30, 2011. A supplemental notice was published at 41 Pa.B. 3943 (July 16, 2011) to clarify that on or after August 27, 2011, lenders could take legal action to enforce a mortgage without having to send an Act 91 notice.
The act of June 27, 2012 (P. L. 648, No. 70) (Act 70) provides funding for the HEMAP. Consequently, the Program will begin immediately to accept applications for assistance.
Act 91 Notice—Form of the Notice
The form of the Act 91 notice has not been changed. The current form of the notice is the same as that published by the Agency at 38 Pa.B. 4859 (August 30, 2008). A copy of the notice follows as Exhibit A. This is the form of notice that must be used by mortgagees and mortgage servicers going forward as the Program restarts. As of October 2, 2012, this notice must be provided in accordance with the provisions of the act. Mortgagees and mortgage servicers may not use any previously published form of the Act 91 notice. Sending a notice in a form that was published by the Agency prior to August 30, 2008, does not meet the requirements of the act and will be considered defective. Mortgagees and mortgage servicers should not add additional or extraneous language to the form or place inconsistent information in the form. For example, putting the notice on letterhead can result in conflicting contact numbers or including a payment coupon can be confusing to the homeowner. Those inappropriate practices may result in referrals under consumer protection laws.
Mortgagees must send all notices required by law. Act 70 makes it very clear that there are serious consequences when the mortgagee or mortgage servicer does not send an Act 91 notice to homeowners or sends a defective notice (that is, one that does not meet the requirements of the form notice published by the Agency; one that does not contain all of the information required by the form of the notice; or one that contains confusing, additional, conflicting or inappropriate information). In those cases the trial court may dismiss the foreclosure action, order the service of a corrected notice, impose a stay of the action or impose other appropriate remedies.
Current List of Counseling Agencies by County
The Agency contracts with counseling agencies to help the homeowner submit an application to the Agency for HEMAP. A current list of counseling agencies can be found on the Agency's web site at http://www.phfa.org/counseling/hemap.aspx.
This list is current as of the date of publication of this notice and will be updated periodically by the Agency on the web site. Many of the counseling agencies serve more than one county or have multiple offices. A list of counseling agencies available for the county in which the property being foreclosed upon is located must be attached to or otherwise made a part of the Act 91 notice. If the property is located in more than one county a list of counseling agencies for each county in which it is located must be attached. Lenders should not attach a complete list of counseling agencies for all counties in this Commonwealth or for counties where the property is not located. This will only confuse homeowners and will make the notice defective.
A. This notice takes effect immediately upon publication in the Pennsylvania Bulletin and the Agency will begin accepting applications for HEMAP under Act 91 and the Program guidelines. Applications are made through counseling agencies approved by the Agency, which are authorized to accept applications immediately.
B. Beginning October 2, 2012, a mortgagee or mortgage servicer must send homeowners an Act 91 notice under section 402-C of the act (35 P. S. § 1680.402c) prior to the beginning of any legal action including mortgage foreclosure. The mortgagee or other person sending the Act 91 notice must supply the Agency with either a copy of the Act 91 notice or information concerning notices sent under the act and 12 Pa. Code § 31.211 (relating to Act 91 Notices; information to be supplied to the Agency).
C. If a mortgagee or mortgage servicer began a legal action prior to the date referred to in previously listed paragraph B and an Act 91 notice was not sent to the homeowners because none was required under the act and the Program guidelines due to insufficient funding for continuation of the Program (see 41 Pa.B. 2789 and 41 Pa.B. 3943), the Agency strongly urges mortgagees and mortgage servicers to advise homeowners and the homeowners attorney of record if applicable, of the restart of HEMAP and to provide them with an up-to-date list of counseling agencies available to help them make application to the Agency.
D. Homeowners who are currently in foreclosure and potentially eligible for HEMAP may apply for mortgage assistance even though they have not received an Act 91 notice due to the temporary suspension of the Program and the fact that mortgagees and mortgage servicers were not obligated to send Act 91 notices prior to the beginning of a foreclosure action. However, the homeowner is at risk of losing the home in foreclosure since the mortgagee or mortgage servicer is currently under no obligation to stay the foreclosure action pending the Agency's consideration of the HEMAP application. If a homeowner, who is currently in foreclosure but has not received an Act 91 notice, applies to the Agency for mortgage assistance, the mortgagee or mortgage servicer is strongly urged to stay all foreclosure action for a period of 60 days to allow the Agency to make a decision on the application. (The counseling agency and the Agency each routinely notify the mortgagee or the mortgage servicer that a HEMAP application has been filed.) It is highly recommended that homeowners facing a possible sheriff sale be provided an opportunity for the Agency to review and act upon their application for possible assistance.
E. If and when an application is approved by the Agency, the mortgagee or mortgage servicer shall promptly provide the Agency with reinstatement figures so that the Agency can get the HEMAP loan closed under 12 Pa. Code § 31.203(b)(11) (relating to notice; application procedures).
Interest Rate for HEMAP Loans Closed in 2012
Under section 406-C of the Housing Finance Agency Law (35 P. S. § 1680.406c), the Agency is to determine prior to the end of each calendar year, the rate of interest for HEMAP loans closed in the next calendar year, which rate is not to exceed the rate of interest established by the Department of Banking under section 301 of the act of January 30, 1974 (P. L. 13, No. 6), referred to as the Loan Interest and Protection Law, and referred to commonly as the Usury Law. The Agency has determined that the rate of interest for HEMAP loans closed during calendar year 2012 shall be 4.75%.
BRIAN A. HUDSON, Sr.,
ACT 91 NOTICE
TAKE ACTION TO SAVE
YOUR HOME FROM
This is an official notice that the mortgage on your home is in default, and the lender intends to foreclose. Specific information about the nature of the default is provided in the attached pages.
The HOMEOWNER'S EMERGENCY MORTGAGE ASSISTANCE PROGRAM (HEMAP) may be able to help to save your home. This Notice explains how the program works.
To see if HEMAP can help, you must MEET WITH A CONSUMER CREDIT COUNSELING AGENCY WITHIN 33 DAYS OF THE DATE OF THIS NOTICE. Take this Notice with you when you meet with the Counseling Agency.
The name, address and phone number of Consumer Credit Counseling Agencies serving your County are listed at the end of this Notice. If you have any questions, you may call the Pennsylvania Housing Finance Agency toll free at 1-800-342-2397. (Persons with impaired hearing can call (717) 780-1869).
This Notice contains important legal information. If you have any questions, representatives at the Consumer Credit Counseling Agency may be able to help explain it. You may also want to contact an attorney in your area. The local bar association may be able to help you find a lawyer.
LA NOTIFICACóN EN ADJUNTO ES DE SUMA IMPORTANCIA, PUES AFECTA SU DERECHO A CONTINUAR VIVIENDO EN SU CASA. SI NO COMPRENDE EL CONTENIDO DE ESTA NOTIFICACIóN OBTENGA UNA TRADUCCIóN INMEDIATAMENTE LLAMANDO ESTA AGENCIA (PENNSYLVANIA HOUSING FINANCE AGENCY) SIN CARGOS AL NUMERO MENCIONADO ARRIBA. PUEDE SER ELEGIBLE PARA UN PRÉSTAMO POR EL PROGRAMA LLAMADO ''HOMEOWNER'S EMERGENCY MORTGAGE ASSISTANCE PROGRAM'' EL CUAL PUEDE SALVAR SU CASA DE LA PERDIDA DEL DERECHO A REDIMIR SU HIPOTECA.
* (Must be at least 30 point type)
HOMEOWNER'S NAME(S): __________
PROPERTY ADDRESS: __________
LOAN ACCT. NO.: __________
CURRENT LENDER/SERVICER: __________
HOMEOWNER'S EMERGENCY MORTGAGE ASSISTANCE PROGRAM
YOU MAY BE ELIGIBLE FOR FINANCIAL ASSISTANCE
WHICH CAN SAVE YOUR HOME FROM FORECLOSURE AND
HELP YOU MAKE FUTURE MORTGAGE PAYMENTS
IF YOU COMPLY WITH THE PROVISIONS OF THE HOMEOWNER'S EMERGENCY MORTGAGE ASSISTANCE ACT OF 1983 (THE ''ACT''), YOU MAY BE ELIGIBLE FOR EMERGENCY MORTGAGE ASSISTANCE:
• IF YOUR DEFAULT HAS BEEN CAUSED BY CIRCUMSTANCES BEYOND YOUR CONTROL,
• IF YOU HAVE A REASONABLE PROSPECT OF BEING ABLE TO PAY YOUR MORTGAGE PAYMENTS, AND
• IF YOU MEET OTHER ELIGIBILITY REQUIREMENTS ESTABLISHED BY THE PENNSYLVANIA HOUSING FINANCE AGENCY.
TEMPORARY STAY OF FORECLOSURE—Under the Act, you are entitled to a temporary stay of foreclosure on your mortgage for thirty (30) days from the date of this Notice (plus three (3) days for mailing). During that time you must arrange and attend a ''face-to-face'' meeting with one of the consumer credit counseling agencies listed at the end of this Notice. THIS MEETING MUST OCCUR WITHIN THIRTY-THREE (33) DAYS OF THE DATE OF THIS NOTICE. IF YOU DO NOT APPLY FOR EMERGENCY MORTGAGE ASSISTANCE, YOU MUST BRING YOUR MORTGAGE UP TO DATE. THE PART OF THIS NOTICE CALLED ''HOW TO CURE YOUR MORTGAGE DEFAULT'', EXPLAINS HOW TO BRING YOUR MORTGAGE UP TO DATE.
CONSUMER CREDIT COUNSELING AGENCIES—If you meet with one of the consumer credit counseling agency listed at the end of this notice, the lender may NOT take action against you for thirty (30) days after the date of this meeting. The names, addresses and telephone numbers of designated consumer credit counseling agencies for the county in which the property is located are set forth at the end of this Notice. It is only necessary to schedule one face-to-face meeting. Advise your lender immediately of your intentions.
APPLICATION FOR MORTGAGE ASSISTANCE—Your mortgage is in default for the reasons set forth later in this Notice (see following pages for specific information about the nature of your default.) You have the right to apply for financial assistance from the Homeowner's Emergency Mortgage Assistance Program. To do so, you must fill out, sign and file a completed Homeowner's Emergency Assistance Program Application with one of the designated consumer credit counseling agencies listed at the end of this Notice. Only consumer credit counseling agencies have applications for the program and they will assist you in submitting a complete application to the Pennsylvania Housing Finance Agency. To temporarily stop the lender from filing a foreclosure action, your application MUST be forwarded to PHFA and received within thirty (30) days of your face-to-face meeting with the counseling agency
YOU SHOULD FILE A HEMAP APPLICATION AS SOON AS POSSIBLE. IF YOU HAVE A MEETING WITH A COUNSELING AGENCY WITHIN 33 DAYS OF THE POSTMARK DATE OF THIS NOTICE AND FILE AN APPLICATION WITH PHFA WITHIN 30 DAYS OF THAT MEETING, THEN THE LENDER WILL BE TEMPORARILY PREVENTED FROM STARTING A FORECLOSURE AGAINST YOUR PROPERTY, AS EXPLAINED ABOVE, IN THE SECTION CALLED ''TEMPORARY STAY OF FORECLOSURE''.
YOU HAVE THE RIGHT TO FILE A HEMAP APPLICATION EVEN BEYOND THESE TIME PERIODS. A LATE APPLICATION WILL NOT PREVENT THE LENDER FROM STARTING A FORECLOSURE ACTION, BUT IF YOUR APPLICATION IS EVENTUALLY APPROVED AT ANY TIME BEFORE A SHERIFF'S SALE, THE FORECLOSURE WILL BE STOPPED.
AGENCY ACTION—Available funds for emergency mortgage assistance are very limited. They will be disbursed by the Agency under the eligibility criteria established by the Act. The Pennsylvania Housing Finance Agency has sixty (60) days to make a decision after it receives your application. During that time, no foreclosure proceedings will be pursued against you if you have met the time requirements set forth above. You will be notified directly by the Pennsylvania Housing Finance Agency of its decision on your application.
NOTE: IF YOU ARE CURRENTLY PROTECTED BY THE FILING OF A PETITION IN BANKRUPTCY, THE FOLLOWING PART OF THIS NOTICE IS FOR INFORMATION PURPOSES ONLY AND SHOULD NOT BE CONSIDERED AS AN ATTEMPT TO COLLECT THE DEBT.
(If you have filed bankruptcy you can still apply for Emergency Mortgage Assistance.)
HOW TO CURE YOUR MORTGAGE DEFAULT (Bring it up to date).
NATURE OF THE DEFAULT—The MORTGAGE debt held by the above lender on your property located at:
IS SERIOUSLY IN DEFAULT because:
A. YOU HAVE NOT MADE MONTHLY MORTGAGE PAYMENTS for the following months and the following amounts are now past due:
Other charges (explain/itemize): __________
TOTAL AMOUNT PAST DUE: __________
B. YOU HAVE FAILED TO TAKE THE FOLLOWING ACTION (Do not use if not applicable):
HOW TO CURE THE DEFAULT—You may cure the default within THIRTY (30) DAYS of the date of this notice BY PAYING THE TOTAL AMOUNT PAST DUE TO THE LENDER, WHICH IS $ ______ , PLUS ANY MORTGAGE PAYMENTS AND LATE CHARGES WHICH BECOME DUE DURING THE THIRTY (30) DAY PERIOD. Payments must be made either by cash, cashier's check, certified check or money order made payable and sent to:
You can cure any other default by taking the following action within THIRTY (30) DAYS of the date of this letter: (Do not use if not applicable.)
IF YOU DO NOT CURE THE DEFAULT—-If you do not cure the default within THIRTY (30) DAYS of the date of this Notice, the lender intends to exercise its rights to accelerate the mortgage debt. This means that the entire outstanding balance of this debt will be considered due immediately and you may lose the chance to pay the mortgage in monthly installments. If full payment of the total amount past due is not made within THIRTY (30) DAYS, the lender also intends to instruct its attorneys to start legal action to foreclose upon your mortgaged property.
IF THE MORTGAGE IS FORECLOSED UPON—The mortgaged property will be sold by the Sheriff to pay off the mortgage debt. If the lender refers your case to its attorneys, but you cure the delinquency before the lender begins legal proceedings against you, you will still be required to pay the reasonable attorney's fees that were actually incurred, up to $50.00. However, if legal proceedings are started against you, you will have to pay all reasonable attorney's fees actually incurred by the lender even if they exceed $50.00. Any attorney's fees will be added to the amount you owe the lender, which may also include other reasonable costs. If you cure the default within the THIRTY (30) DAY period, you will not be required to pay attorney's fees.
OTHER LENDER REMEDIES—The lender may also sue you personally for the unpaid principal balance and all other sums due under the mortgage.
RIGHT TO CURE THE DEFAULT PRIOR TO SHERIFF'S SALE—If you have not cured the default within the THIRTY (30) DAY period and foreclosure proceedings have begun, you still have the right to cure the default and prevent the sale at any time up to one hour before the Sheriff's Sale. You may do so by paying the total amount then past due, plus any late or other charges then due, reasonable attorney's fees and costs connected with the foreclosure sale and any other costs connected with the Sheriff's Sale as specified in writing by the lender and by performing any other requirements under the mortgage. Curing your default in the manner set forth in this notice will restore your mortgage to the same position as if you had never defaulted.
EARLIEST POSSIBLE SHERIFF'S SALE DATE—It is estimated that the earliest date that such a Sheriff's Sale of the mortgaged property could be held would be approximately ______ months from the date of this Notice. A notice of the actual date of the Sheriff's Sale will be sent to you before the sale. Of course, the amount needed to cure the default will increase the longer you wait. You may find out at any time exactly what the required payment or action will be by contacting the lender.
HOW TO CONTACT THE LENDER:
Name of Lender:
EFFECT OF SHERIFF'S SALE—You should realize that a Sheriff's Sale will end your ownership of the mortgaged property and your right to occupy it. If you continue to live in the property after the Sheriff's Sale, a lawsuit to remove you and your furnishings and other belongings could be started by the lender at any time.
ASSUMPTION OF MORTGAGE—You _____ may or _____ may not (CHECK ONE) sell or transfer your home to a buyer or transferee who will assume the mortgage debt, provided that all the outstanding payments, charges and attorney's fees and costs are paid prior to or at the sale and that the other requirements of the mortgage are satisfied.
YOU MAY ALSO HAVE THE RIGHT:
• TO SELL THE PROPERTY TO OBTAIN MONEY TO PAY OFF THE MORTGAGE DEBT OR TO BORROW MONEY FROM ANOTHER LENDING INSTITUTION TO PAY OFF THIS DEBT.
• TO HAVE THIS DEFAULT CURED BY ANY THIRD PARTY ACTING ON YOUR BEHALF.
• TO HAVE THE MORTGAGE RESTORED TO THE SAME POSITION AS IF NO DEFAULT HAD OCCURRED, IF YOU CURE THE DEFAULT. (HOWEVER, YOU DO NOT HAVE THIS RIGHT TO CURE YOUR DEFAULT MORE THAN THREE TIMES IN ANY CALENDAR YEAR.)
• TO ASSERT THE NONEXISTENCE OF A DEFAULT IN ANY FORECLOSURE PROCEEDING OR ANY OTHER LAWSUIT INSTITUTED UNDER THE MORTGAGE DOCUMENTS,
• TO ASSERT ANY OTHER DEFENSE YOU BELIEVE YOU MAY HAVE TO SUCH ACTION BY THE LENDER.
• TO SEEK PROTECTION UNDER THE FEDERAL BANKRUPTCY LAW.
CONSUMER CREDIT COUNSELING AGENCIES SERVING YOUR COUNTY
(Fill in a list of all Counseling Agencies listed in Appendix C, FOR THE COUNTY in which the property is located,
using additional pages if necessary).
[Pa.B. Doc. No. 12-1613. Filed for public inspection August 17, 2012, 9:00 a.m.]
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