By JENNIFER CHEN
Capital News Service
LANSING – Although the state has received nearly $500 million in federal funds to assist homeowners, many Michigan residents are still fighting foreclosures.
According to a U.S. Treasury Department report, Michigan has committed about $30 million, only 6.1 percent of that money, helping 2,897 homeowners avoid foreclosures. Only three states received larger grants.
It is crucial to create programs that allow families to stay in their homes, stopping a significant drop in real estate values and encouraging economic growth in all regions, said Mary Lou Keenon, communications director at the Michigan State Housing Development Authority.
She said Michigan uses money from the Hardest Hit program for mortgage subsidies and loans.
The program was set up last year for innovative measures to help families in the states hit hardest by the housing crisis.
Although the state offers options for help, many homeowners are still struggling.
Keenon said large banks in Michigan began participating in the federal program later than most states in March 2011, after her agency agreed to handle the application process.
“Once the Step Forward program becomes fully operable, efforts to help homeowners avoid foreclosure will be exemplary,” she said. However, she doesn’t know when that will be.
Michigan launched the Step Forward program as part of its Hardest Hit activities.
An increasing number of homeowners have gotten help since December, according to the Treasury Department’s 2011 Hardest Hit fund report.
Among them, Wayne County had the most people who qualified for assistance — 417. The other top four counties were Oakland, Macomb, Saginaw and Washtenaw.
The program provides hope, but it does not always work, said Mark McArdle, the Hardest Hit program director for the U.S. Treasury in Washington.
For example some applicants must wait for the final decision, which might not help for emergency cases, he said.
David Szymanski, chief deputy treasurer for Wayne County, said, “Many property owners in our county are still fighting foreclosure.”
And William Acheson, director of the Franklin Street Community Housing Corp. in Lansing, said, some homeowners didn’t know of any programs when they faced foreclosure or didn’t have enough time to apply.
Nearly 39 percent of the Michigan applications are still in process and 31 percent have been approved, according to the report.
Keenon said, “It may take about two months after the paperwork is done for the final decisions, but the program needs more applications.”
The funds are intended for homeowners who are laid off or suffering from wage cuts or medical emergency needs, she said, and the agency is encouraging people who need help to apply.
The application information is available at www.stepforwardmichigan.org. The assistance hotline is 866-946-7432.
By JENNIFER CHEN