While I appreciate the coverage that the Phoenix news stations have given the state’s foreclosure woes, I continue to be frustrated by the lack of depth in the reporting.
Take, for example, this news story by Channel 15, the ABC affiliate, on the Save Our Home AZ program, which was launched last September to distribute Arizona’s portion of the “Hardest-Hit Fund” dollars provided to states with the highest foreclosure rates.
When I called about eligibility last December, I was very clearly told that if your loan was owned/guaranteed by Freddie Mac, Fannie Mae, FHA or VA, you could not receive assistance through Save Our Home AZ. Those agencies own or guarantee the vast majority of mortgage loans in the United States. (Fannie and Freddie together guarantee about 70 percent!)
You also don’t qualify for the program if you had ever refinanced your mortgage loan. And that applies equally whether you prudently refinanced to get out of a risky adjustable-rate mortgage or whether you did a cash-out refi and went on vacation or a big shopping spree.
So, who exactly is this program meant to help? Good question, one I can’t believe Stephanie Hockridge and other reporters aren’t asking. It’s no wonder that only a small amount of the money intended to help Arizonans stave off foreclosure has been distributed so far. (Third quarter 2011 numbers aren’t yet posted on the Arizona Housing Dept. website, but through June 2011, only 78 people had gotten assistance.)
The states got to design these distribution programs themselves to meet the needs of their constituencies, so why not set more reasonable eligibility standards? Why create a program that only a tiny percentage of homeowners can take advantage of in the state that has consistently remained in the top three hardest hit by the foreclosure crisis?
When a program is so clearly designed to fail in its stated purpose, I can’t help but wonder why. The question I’d most like one of these reporters to ask is what happens to any undistributed money at the end of the program? I can’t help but suspect that a percentage of it stays right here in Arizona, not necessarily earmarked to help homeowners facing foreclosure.
A program like this that is more PR hype than actual help to real people is nothing more than a scam – no different from all the fly-by-night businesses offering to help desperate people dodge foreclosure or secure mortgage modifications.
I sure wish one of these reporters would hold some bureaucrats’ feet to the fire and find out why our own state housing agency would provide false hope in such challenging times and squander millions of dollars that are so badly needed by so many good people just trying to hang on to their homes. And why our governor, our attorney general and our legislature haven’t done anything to bring real help to Arizona’s homeowners.