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Vermont’s COVID Emergency Mortgage Assistance Program Re-Opens Next Week

Published on April 29, 2021 by Vermont Housing Finance Agency
Vermont’s COVID Emergency Mortgage Assistance Program Re-Opens Next Week

BURLINGTON, VT – The Vermont program that helps homeowners who have fallen behind on their mortgage or property taxes during the COVID-19 pandemic will re-open on Monday, May 3, 2021.  The Mortgage Assistance Program, will provide grants covering up to 12 months of past due mortgage payments and property taxes for eligible homeowners.

Funded through the federal CARES Act, the program operated first in July through December 2020, providing 636 Vermont households with grants averaging $6,000. With average monthly mortgage payments of $1,200, most of these households owed three months or more of payments and the majority were in a forbearance.

The program is administered by Vermont Housing Finance Agency (VHFA) but is open to all eligible homeowners regardless of loan servicer.

A homeowner in forbearance can pause or reduce their mortgage payments for a limited period agreed to by the mortgage servicer, which helps avoid immediate foreclosure. However, forbearance does not erase the amount the homeowner ultimately owes and sometimes the repayment requirements may leave the home unaffordable. By providing grants on the homeowner’s behalf to the loan servicer for missed payments, the Mortgage Assistance Program lowers the balance the homeowner owes.

“We are relieved to be resuming these grants for the many Vermont homeowners who continue to face economic hardship in this pandemic,” remarked Maura Collins, VHFA’s Executive Director. “We have already heard from homeowners concerned about paying back their forbearance balances and are glad this program can offer them a path toward housing and financial stability.”

Some applicants who needed mortgage assistance in 2020 were unable to work because they were caring for immune-compromised children at home. With vaccines limited to people aged 16 and up, the need for some workers to stay home is unlikely to change soon.

“I’m doing everything I can to support my family, but I have no idea when it will be safe for me return to work,” explained Kimberly Edgars, a nurse who left her job to care for her children, one of whom has special needs and is at high risk of complications. “So many people are dealing with situations like mine right now and I think this program can make a huge difference for lots of families.”

Vermont’s economy continues to struggle in many sectors, contributing to an extended need for mortgage assistance. The number of jobs in Vermont declined by a dramatic 7.6% between March 2020 and March 2021 — more than any other New England state. This level of job loss is the highest on record in Vermont and is hitting the leisure and hospitability sector most severely. Leisure and hospitality jobs in Vermont fell by 12,300 jobs, or 34%, in 2020.

Vermonters’ employment losses are reflected in missed mortgage payments, which have doubled over the course of the pandemic. Nearly 4.7% of all Vermont mortgages were seriously delinquent at the end of 2020, compared to just 2.2% at the end of 2019, according to the Mortgage Bankers Association. Although a state foreclosure moratorium remains in place through at least mid-June, its eventual expiration and reduction of federal benefits will leave many Vermonters at risk of losing their homes.

The Mortgage Assistance Program will be available to eligible homeowners who have missed at least one payment since March 2020 regardless of whether they are in forbearance. Eligibility requirements and application instructions are available on VHFA’s website at www.vhfa.org/map.  Mortgage and property tax payments will be made directly to the servicer of the mortgage or the town in which the home is located.

VHFA is a non-profit agency created in 1974 by the Vermont Legislature to finance and promote affordable housing opportunities for low- and moderate-income Vermonters. Since its inception, the Agency has helped approximately 29,000 Vermont households with affordable mortgages and financed the development of approximately 8,800 affordable rental apartments.