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Thanks to the country's state of economic affairs, the Government has been heavily involved in providing assistance to help curb the condition originally created by a mortgage meltdown. One such program launched by President Barack Obama's administrations was the creation of the Hardest Hit Fund that officially launched in February 2010. This program has been developed to funnel financial assistance to families living in the states hardest hit by the double combo of retractions in both the economy and housing market.

In 2009, the Obama administration launched the Financial Stability Act as a way to stem the flow of foreclosures caused by the subprime mortgage mess and subsequent meltdown of the mortgage industry as a whole. The Hardest Hit Fund budget accounts for a small fraction of the $2.1 billion budget allotted by the acts passage. The Hardest Hit Fund allows the most negatively impacted states to hand-craft assistance programs for locally-based homeowners most in need.

About the Hardest Hit Fund

All states were invited to apply to receive money from the "Hardest Hit Fund," however only the states that experienced a 20 percent or larger decrease in average housing prices could qualify for the program. In order to ensure that the money was funneled to the correct locations, the White House implemented strict guidelines surrounding the approval process to receive the infusion of cash. The process requires each state to create and submit detailed proposals directly to the U.S. Treasury Department focusing on the following points:

  • Providing mortgage assistance for unemployed homeowners
  • Provide help for underwater mortgage holders
  • Address second mortgage complications
  • Create programs specifically focused on making homeownership a reality, not a stretch of the imagination

Additionally the Obama Administration made its commitment to "...creating an unprecedented level of openness in Government" part of the procedure as well (WhiteHouse.gov). Program transparency requires the information to be posted online for everyone to see and include tracking devices for measuring results. Any program that has been or will be approved needed to meet levels of government oversight set out in the Emergency Economic Stabilization Act of 2008.

States Included in Hardest Hit Fund

At this point in time, 18 states and the District of Columbia have met the necessary qualifications and have received the government approval and subsequent funds associated with program participation:

Homeowners interested in finding out more about the local programs to assist them with their mortgage needs should visit the state's ".gov" website or contact the state's housing agency directly.

Financial Stability Act of 2009

It is important to note that the Hardest Hit Fund is only a small portion of the larger Financial Stability Act of 2009. Additional facets of the main program included the Making Home Affordable Program (HAMP) and the recently passed Financial Reform Bill. The Financial Stability Act of 2009 created a total $75 billion budget to help aid struggling homeowners.