Brandon, FL (Law Firm Newswire) May 20, 2016 - Florida officials opted not to apply for any additional federal mortgage assistance.
In February, the U.S. Treasury Department announced that the federal Hardest Hit Fund, created in 2010 to combat the lingering effects of the housing crash, would be expanded in two phases of $1 billion each. In the first phase, Florida received $78 million. But Florida declined to apply for any additional funds in the second phase, leaving as much as $250 million on the table, a decision that irked elected officials and local professionals.
Reggie Osenton, a bankruptcy attorney in Tampa, said Florida homeowners could have used the help.
“The housing crash hurt them tremendously,” said Osenton. “Even after years of rising home prices, many are still underwater. I can't imagine what state officials are thinking. This is a real shame.”
Florida Sen. Bill Nelson called the turn of events “tragic.” Nelson has strongly criticized state officials for their handling of the Hardest Hit programs.
In October 2015, a report by the special inspector general of the Troubled Asset Relief Program, or TARP, found Florida lagged far behind all other states in disbursing money from the Hardest Hit Fund. Five years after the program's creation, the state had disbursed just half of its original $1 billion allocation, and had only two years left to pay out the remainder in order to meet the original deadline of December 2017. The deadline has since been extended to December 2020.
Governor Rick Scott's office declined to comment to the Tampa Bay Times on the decision.
“If state officials think homeowners don't need this relief, they're wrong,” said Osenton. “An additional quarter-billion dollars could have had a lasting impact on countless Florida families.”
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