ALBANY, N.Y. (AP) — 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.
Gov. Eliot Spitzer said 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.
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 governor said in a press release. The program operated by the State of New York Mortgage Authority will offer 30- and 40-year fixed rate loans financed through Fannie Mae.
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 state, the income ceiling is $58,120 in Allegany County, $82,870 in Albany County, $93,720 in New York City and $158,560 in Rockland County.
Information is available by calling SONYMA at 1-800-382-4663.
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