While the rest of the country may be waiting for the Federal government to figure out a solution to the housing/foreclosure crisis, the great state of Illinois is, once again, ahead of the pack!
"There have been far too many foreclosures in Illinois," State Treasurer Alexi Giannoulias has said. Foreclosure filings in Illinois jumped 55% in 2006 to 72,455 and are expected to increase through 2008.
Giannoulias drafted a measure to make it easier for homeowners to refinance mortgages by expanding the treasurer's current "Our Own Home" program so that the office can refinance a mortgage before a borrower misses a payment and faces possible foreclosure.
The bill, introduced by House Speaker Michael Madigan (D-Chicago), State Rep. Karen Yarbrough (D-Maywood) and State Sen. Jacqueline Collins (D-Chicago), passed in the Illinois House by a 111 to 2 vote margin, in January. It now awaits vote in the Illinois Senate.
Under the existing Our Own Home program, the Treasurer's Office guarantees 10% of the home-buyer's mortgage to the lender. The program is designed primarily for prospective home-buyers who are unable to secure a conventional mortgage because of less than perfect credit or a high debt-to-income ratio. This guarantee has helped more than 350 Illinois residents buy a home with a conventional mortgage.
The Our Own Home Program also assists people who have already missed at least one mortgage payment due to particular financial hardships, such as a loss of employment or death in the family. However, the program cannot help homeowners who are in danger of losing their home until they have actually missed a payment. Giannoulias' legislation is designed to offer the 10% security to homeowners so they can refinance their mortgages before they miss a payment.
"It is important that we can step in before the homeowner misses a payment, ruining their credit rating or worse, losing their home!" Giannoulias Said.
Any Illinois homeowner whose household income does not exceed $75,000 or whose home value is appraised at or below the median home value for the county in which the home is located is eligible to participate in the Our Own Home Program. In addition, the program is only available to homeowners who cannot secure a conventional mortgage from their lender without the use of the program's 10% guarantee.
Find out more about the Our Own Home Program.