Albany, NY – New York has created a $100 million program to help borrowers facing foreclosure or other financial strain because of risky adjustable rate and interest-only home loans.
Governor Eliot Spitzer says the "Keep the Dream" fund will give eligible low- and middle-income borrowers a way to refinance mortgages they can no longer afford because of recent or pending hikes in interest rates.
Spitzer says the loans for 100 percent of a property's value up to $417,000 will be at competitive rates through a partnership of federal lender Fannie Mae, other mortgage lenders and mortgage insurance companies.
The program also creates a counseling and education program that will be run through eight nonprofit agencies around the state to help borrowers avoid predatory loans and, in the case of delinquency, foreclosure.
To be eligible, a borrower must prove mortgage payment hardship and have income below a certain percentage of their area's median income, which varies around the state. In the examples released by the Spitzer administration, the income ceiling is $58,000 in Allegany County, but more than $158,000 in wealthy Rockland County.