The federal government allocated funds for distressed homeowners as part of its expansive efforts to help Americans cope with the pandemic’s financial strains. Unlike some other stimulus programs, such as checks mailed to individuals, this money moved slowly. The nearly $10 billion Homeowner Assistance Fund was administered through the U.S. Treasury Department, but relied heavily on individual states to set up programs to distribute aid, the Wall Street Journal reported. Some were slow to get up and running. Others struggled with a backlog of applications. For homeowners, getting money before the foreclosure went through could be a race against time. The fund doled out about $2 billion to more than 150,000 households through the end of September, according to the National Council of State Housing Agencies, a trade group. The money serves a narrow slice of the population: There were some 324,000 foreclosure filings last year, below prepandemic norms but more than double 2021, according to real-estate data firm Attom. The funds were made available to homeowners who experienced pandemic-related hardships and whose household incomes were below a certain threshold. Most states gave the money as grants. About 200 homeowners have complained about the program through the Consumer Financial Protection Bureau’s complaint portal, including a handful about foreclosures moving forward while they were waiting on assistance. CFPB warned in March that foreclosing on a borrower who has a pending assistance application “will merit increased scrutiny.” Government officials, as well as representatives of mortgage companies and states, said the assistance program has picked up speed, particularly in recent months, and everyone is working together. Servicers benefit more from taking the money than taking the home in a foreclosure, they said.
