Citi lends a hand to unemployed homeowners

03.04.09
By Timothy Jones

A record number of Americans are battling the stress of unemployment as auto loans, mortgage payments and credit card bills mount.

Now some homeowners with first mortgage loans owned and serviced by CitiMortgage may find short and longer-term relief.

According to an announcement by the financial services company, the Citi Homeowner Assistance program is being expanded to include those who have recently lost their jobs.

The Homeowner Unemployment Assist program is intended to help recently unemployed CitiMortgage customers stay in their homes by offering three months of reduced mortgage payments.

The program, intended to help families avoid foreclosure, would drop the average monthly mortgage payment to $500 for three months. This rate, the company says, is below the nationwide average for rent on a one bedroom residence.

"We understand the emotional and financial trauma that can occur when homeowners lose their jobs, and families are forced to downsize to a smaller space and move away from their neighborhoods and schools because they can no longer afford their mortgage payments, " says Sanjiv Das, CEO of CitiMortgage in the company's announcement.

"Our Homeowner Unemployment Assist program is intended to serve as a bridge toward a longer-term solution, helping homeowners stay in their homes and in their communities while they get their feet back on the ground," he continues.

After the three month assistance period homeowners can either resume normal mortgage payments assuming their financial situation has improved or engage in further discussions with Citi to find a longer-term solution.

This announcement is the latest in a string of solutions proposed to ease the burden on homeowners as the recession presses on.

Earlier this year Fannie Mae and Freddie Mac extended a freeze on foreclosure sales and evictions to help struggling homeowners.

Citi itself agreed to legislation proposed in early 2009 that allowed judges to reduce mortgage debt on homeowners filing for bankruptcy.

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The Citi Homeowner Assistance program will include the recently unemployed