Two dozen protesters wearing yellow T-shirts marched through a downtown Sacramento conference room and chanted slogans Tuesday during a meeting of the California Housing Finance Agency’s board of directors.
The members of the Alliance of Californians for Community Empowerment demanded that the agency’s Keep Your Home California program move faster in distributing $2 billion in federal aid for struggling homeowners.
Keep Your Home California still has about $1 billion of the money it received from the U.S. Treasury Department’s Hardest Hit Fund several years ago. It must spend that remaining amount by 2017.
Critics say the program has been dragging its feet as more homes are lost to foreclosure.
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“What do we want? Principal reduction! When do we want it? Now!” the protesters chanted as they marched in circles around the room at the Holiday Inn on J Street, disrupting the meeting.
Group member Jose Vega and others addressed the board during its public comment period. Vega, who had his own loan payments greatly reduced, said there were thousands of other homeowners who are unable to qualify for aid because they owe so much more than their homes are worth.
“The money is there. It needs to be used,” he said.
At the meeting, CalHFA executives assured the protesters they’d been heard, but later took issue with the group’s message.
“We’re absolutely on track,” said Diane Richardson, head of Keep Your Home California and the housing agency’s director of legislation.
So far the program has helped more than 43,500 homeowners and distributed $790 million in aid, with an additional $75 million in payments scheduled to be distributed, Richardson said.
On Tuesday, Richardson gave The Sacramento Bee a copy of a letter that Tia Boatman Patterson, the agency’s new director, sent to ACCE organizers in response to their demands that Keep Your Home California do more to help struggling homeowners.
The letter contends the program has continually adjusted its criteria since it started in 2011, in order to include more homeowners.
Last year, for instance, Keep Your Home California loosened the rules of its Principal Reduction Program, which can slash the amount borrowers owe by up to $100,000. Previous rules required applicants to prove a hardship such as a death in the family or unemployment. After the changes, homeowners need to show only that they owe 20 percent more than their home is worth.
“In September 2013, California was able to implement a change to PRP that made severe negative equity (on its own) a hardship indicative of imminent default,” Boatman Patterson wrote.
Requirements that lenders modify loans – matching state principal reductions dollar for dollar – were removed.
The letter also noted that anyone who receives unemployment benefits in California is given information about the agency’s Unemployment Mortgage Assistance program, which covers loan payments up to $3,000 a month for 12 months.
Those changes and others have made the program more inclusive over time, officials said.
More information about the state’s homeowner assistance programs is available at keepyourhomecalifornia.org or by calling (888) 954-5337.