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    California has several organizations and programs to help struggling homeowners get back on their feet. If you are a California resident and you fear you could lose your home this article is for you. If you are looking to buy your first home read on; California has several first-time homebuyer programs also.

    However the first tip you should follow when thinking of refinancing, modifying a loan, or buying a new mortgage is to contact a housing counseling agency. They are agencies approved by the Housing and Urban Development department, and provide free (or low cost) professional advice.  Delaying action could cost your home or at the very least extra costs and fees on your mortgage.

    One of these agencies is the Consumer Credit Counseling Service of San Francisco, which manages the Housing Education Program. This program provides free or low cost education to homebuyers and borrowers through education materials, workshops and personal counseling. Their early delinquency intervention program and post-foreclosure help program are of special interest. For a list of approved housing counseling agencies in California click here.

    Unfortunately the housing crisis we are now suffering does not seem to be going away soon. Layoffs continue, health costs are rising and home prices remain low. This has created a housing “perfect storm” that has affected millions of homeowners.

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    Government mortgage aid programs in California focus on two areas: education and funding incentives for lenders. Education is important for lenders because often it is a lack of understanding of the foreclosure process that makes homeowners lose their homes. Obviously sometimes homeowners simply cannot afford their mortgages and their best choice is to find the most graceful way out of their mortgage.

    However, in other occasions help is available and foreclosure can be avoided. This series of two articles will look at three types of California mortgage aid programs: mortgage protection, buying and tax credits.

    CalHFA is one of the main mortgage aid providers in California. Set up in 1975; it has been around through various housing crisis. It is a State chartered affordable housing bank designed to offer affordable low interest loans. The agency can afford to offer the service thank to the sale of tax-free bonds, which are repaid with the interest of mortgage loans. No tax dollars are used to fund the agency.

    Home Openers mortgage protection program is automatically included with every CalHFA mortgage at no extra cost. The free service covers your mortgage costs if you involuntarily lose your job and are receiving benefits from the California Employment Development Department and are making an effort to look for work. These payments will be covered for six months, giving you time to rearrange your finances. This forbearance period of six months is an excellent safety net you can use to arrange your loan modification if you think your situation will continue.

    Learn about more mortgage aid programs in the second article of this series.

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