What are homeowner’s options as Michigan’s Step Forward program closes down?

After five years of helping distressed homeowners, Step Forward Michigan is out of funding.

Now that funding is ending for the assistance program known as Step Forward Michigan, homeowners will have to resort to more traditional ways to ensure that their mortgages and property taxes are paid up to date. Since 2010, Michigan’s Step Forward program has been available for financially strapped homeowners, helping them to pay past due balances for a fresh start. Going forward, working with both lenders and county treasurer’s offices will be critical for homeowners. 

So what now? The most important component is communicating with lenders, county treasurer’s and municipalities if a homeowner is past due or believes that they will become past due in the near future. It is crucial to keep the lines of communication open. If the lender doesn’t know you’re in financial trouble, they can’t help and they may think you’re not concerned about the problem. There are still many programs available to homeowners struggling with mortgage payments. Making Home Affordable (HAMP) has been extended until Dec. 31, 2016. 

If a loan modification is not an alternative, either because of the qualifications or if there isn’t a mortgage on the home, then there are several other possibilities open to homeowners. 

  1. Set up a repayment plan with the lender or treasurer’s office
  2. Find out if you’re qualified for any property exemptions to reduce the amount owed.
  3. Borrow the past due amount from family or friends 

When property taxes are delinquent, the best option is to set up a payment plan with either the municipality or county where the property is located. Homeowner’s have time to pay their property taxes but there are deadlines. If taxes are due now for 2013, then in 2016 if the taxes on the home remain past due, the property will be foreclosed and the homeowner will lose all rights to their home. 

However, county treasurer’s offices have several options to prevent this from happening.

  1. Stipulated Payment Agreement (SPA)
  2. Distressed Owner Occupant Exemption (DOOE)
  3. Interest Reduction Stipulated Payment Agreement (IRSPA) 

It is vital to keep all lines of communication open between homeowners, lenders and tax authorities. As hard as it is to admit there are financial challenges, asking for help can help save your home. Michigan State University Extension has certified housing counselors who can assist in the process. To contact an expert in your area, visit the expert page, or call 888-MSUE4MI (888-678-3464). 

Michigan State University Extension offers financial literacy and homeownership workshops throughout the year to help you become financially healthy. For more information of classes in your area, go to either the events page or the MI Money Health website. Additionally, you can take the Financial Health Survey at MI Money Health to access if you’re financially healthy and discover more ways you can improve your financial health. 

Michigan State University Extension has released a new toolkit for homeowners who are experiencing or have previously experienced foreclosure. This toolkit will equip these individuals and families with tools to help them recover their financial stability, in the case that a recovery of their home is not possible. The toolkit is available to download free at the MI Money Health website.

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