Four years into a $1 billion foreclosure prevention plan, Florida is not getting enough money into the hands of struggling homeowners and has enrolled fewer than 100 people into one of its five programs, according to a quarterly report to Congress on the Hardest Hit Fund.

The review by the inspector general of the Troubled Asset Relief Program, which was released today, rebukes Florida, and 11 other states, for lagging in their distribution of Hardest Hit money.

 

Nationally, $7.6 billion in taxpayer dollars was awarded to 18 states and the District of Columbia through the Hardest Hit program. Announced by the Obama administration in 2010, the money is doled out by state housing organizations that qualify homeowners for assistance.

 

Today’s report says states have spent a collective 46 percent, or $3.5 billion, to help 207,511 individual homeowners.

In Florida, the review found $417.1 million in Hardest Hit money had been spent as of the end of September to aid 19,761 homeowners. An additional $46 million has been spent on administrative expenses.

“Even though the Treasury Department obligated $1.05 billion of HHF funds to Florida, Florida is not getting a significant amount of these funds out the door to help homeowners,” the inspector general report says.

But more recent enrollment numbers from Florida’s Hardest Hit program show higher results. Through December, about $463 million had been disbursed, helping 21,299 borrowers statewide. The state has until the end of 2017 to spend or commit all of its $1.05 billion.

“We know we are on task and feel we are poised to get the money out by deadline,” said Cecka Green, a spokesperson for the Florida Housing Finance Corp., which oversees the state’s Hardest Hit program. “We are spending $18 to $20 million per month and are confident this program is in good shape as far as it sun setting.”

Florida has five programs that draw from the Hardest Hit money, one of which is singled out in the report for having enrolled 31 people since it was approved in March 2013. Green said that number is up to 71 through December.

The Modification Enabling Pilot was approved to receive $50 million by the Florida Housing Finance Corp. The program partners with the New Jersey-based National Community Capital to write down principal balances on Florida mortgages the non-profit wins at defaulted loan auctions.

But the group has often lost out to higher bids from for-profit private equity firms, including the Coral Gables-based Bayview Asset Management, whose main stakeholder is Wall Street’s Blackstone Group.

Palm Beach Gardens homeowner Gail Moore wasn’t surprised to hear the concerns from the inspector general. She said she waited seven months to get approved for Hardest Hit’s principal reduction program, and believes the delay was caused by missteps from the group handling her application. Florida Housing has HUD-approved counseling agencies statewide review and approve applications.

“The counseling agency didn’t even understand the contract they were asking me to sign,” Moore said. “I was informed and persistent, but I know there are many people still struggling or who give up because of the lengthy process, unanswered questions and ultimate frustration of the whole process.”

by Kimberly Miller