UPDATE: Here is the full June 24 Sacramento Bee story that explains the program:
The California Housing Finance Agency has just announced U.S. Treasury Department approval for a $700 million plan to help more struggling California borrowers stay in their homes.
It applies to moderate-income borrowers and contains some money to write down loans to today's values. There is also money to help people who simply can't afford their homes move to new rentals. It's part of a $2.1 billion federal initiative to help borrowers in states where home prices have fallen by 20 percent or more.
Approvals for the first $1.5 billion of that $2.1 billion were also announced this morning by the U.S. Treasury Department.
UPDATE AT 10:15 AM: We just talked minutes ago with Evan Gerberding, marketing manager for what's being called the Keep Your Home Program. (Check the link for details about eligibility etc). The aim is to help approximately 40,000 borrowers over the next three years, starting with the hardest-hit counties.
The goal is to start Nov. 1, said Gerberding.
Here is the full 44-page California proposal approved by the U.S. Treasury Department.
It looks so far like they will provide up to $1,500 a month for people in danger of defaulting on mortgages because of job losses. And they'll offer $50,000 to lenders to lower what's owed on the house - and aim to have lenders match that amount.
CalHFA is adding some staff to run this. We asked what percentage of the $700 million is going to staff. They promised to get us a number on that.
Overall, it sounds like a new cushion that could help thousands avoid foreclosure. On a cautionary note, earlier programs have been rolled out with fanfare and then proved a disappointment. But anyone who gets saved here from a foreclosure is one less.
Gerberding advised people who are struggling now NOT to wait until this begins. Keep trying to work with your lender through a HUD-approved counselor, she advised. More details on how to apply for this and what to do will become available as we get closer to Nov. 1, she said.