Rabb: We must work to ensure people have the means to keep their homes during the extraordinary public health and economic crisis
HARRISBURG, Sept. 29– State Rep. Chris Rabb, in a House Commerce Committee hearing on Sep. 22, emphasized the urgency of the housing crisis in Pennsylvania, highlighting the Pennsylvania Housing Finance Agency’s history of working to ensure people have a home and the means to sustain it.
Rabb called his colleagues’ and PHFA Executive Director and CEO Robin Weissman’s attention to the necessity of ensuring that state residents do not lose their homes due to late bills. Rabb further asserted that some applicants have not been allowed to obtain loan modifications because of junior (utility) liens.
Rabb noted that PHFA has historically fought for mortgage modifications for homeowners, which help prevent them from losing their homes due to late water, gas, or credit card bills. “Working people struggling to make ends meet during an unprecedented economic crisis caused by the coronavirus must not be forced out of their homes,” Rabb said.
He emphasized that Pennsylvanians may lose their homes soon because of outstanding credit card or utility bills and called for “federal requirements for housing-related loans to be made accessible to people at risk of losing their homes. Our foremost priority is to ensure people can keep their homes, despite the unparalleled financial hardship.”
Rabb also put a spotlight on the efforts PHFA is making to help homeowners, including providing counseling on and access to state programs aimed at ensuring as many Pennsylvanians as possible keep their homes. “It is critical the PHFA, our state and federal government work to alleviate the nationwide housing emergency – in Pennsylvania and across our nation, residents have experienced hardship not seen in decades. We must all work as one to alleviate the pain COVID-19 has caused,” he said.
Since 2016, PHFA and a few other outlier lenders/servicers require that all liens be cleared or subordinated before approving a loan modification, even after the homeowner has qualified through a rigorous application and underwriting process, including a three-month trial payment period. Rabb said it can be overwhelmingly difficult for homeowners to pay off their utility liens after facing foreclosure and making monumental efforts to get back on track with their mortgage, to the point of qualifying for a loan modification.
Rabb emphasized that he is committed to finding a solution to the junior liens (utility) that preclude homeowners from obtaining a loan modification, after they have qualified and completed a three-month trial plan.
Solutions could include, but are not limited to:
- Not placing utility liens on the property, since they are junior lien(s), at best.
- Agreeing to subordinate the lien(s) in a timely manner when a homeowner has qualified for a loan modification.
- Providing a workout option such as partial forgiveness or settlement combined with the release of the lien(s).
- Agreeing to release the lien(s) if the homeowner is in a payment arrangement.
“As a lawmaker, I am committed to putting people and families first, but it is especially critical that we ensure the appropriate resources and assistance are provided to Pennsylvanians during the ongoing economic downturn and the pandemic which has led to many losing their loved ones, family members, and friends. We are all in this together, and as a commonwealth, of, by, and for all people, we will get through this – together,” Rabb said.