The Obama administration announced today that five states -- Ohio, North Carolina, South Carolina, Oregon and Rhode Island -- now have access to $600 million to implement their own foreclosure prevention programs.
Funding for those states was initially announced in March. Their housing finance agencies submitted proposals to the Treasury Department earlier this summer, which were reviewed to make sure they complied with federal laws.
The five-state group was the second to get funding under the "Hardest Hit" program, which provides federal money for state-run efforts to reduce foreclosures. In June, $1.5 billion was approved for Arizona, California, Florida, Michigan and Nevada, which have high numbers of underwater homeowners.
The latest states were selected because they all have relatively high percentages of residents living in areas with heavy concentrations of unemployment, according to Treasury officials.
The funding and aid targets for each state are:
· North Carolina -- $159 million to aid up to 7,190 homeowners
· Ohio -- $172 million to aid up to 5,356 homeowners
· Oregon -- $88 million to aid up to 7,400 homeowners
· Rhode Island -- $43 million to aid up to 5,000 homeowners
· South Carolina -- $138 million to aid up to 12,000 homeowners.
The money comes from the Troubled Asset Relief Program, which was appoved by Congress in October 2008.
Another group of states could soon be approved for $2 billion in funding under the program, said Herb Allison, the Treasury Department official who oversees TARP, in a conference call with reporters Wednesday. That program will be geared toward residents who are suffering from unemployment, said Phyllis Caldwell, who leads Treasury's home preservation office.
Some of the programs will be used to help unemployed borrowers make their mortgage payments while they seek employment. Others provide relocation aid to borrowers and incentive payments to servicers in exchange for the release of second liens, in an effort to facilitate short sales.