HUD ANNOUNCES FUNDING TO HELP FAMILIES FIND OR KEEP HOMES

Today, U.S. Department of Housing and Urban Development Regional Director Taylor Caswell announced $50,000 in funding to Central Vermont Community Action Council to help families and individuals find or keep homes.

The grant, part of $44 million nationwide, is being awarded under HUD's housing counseling program, which provides critical funding to help local agencies assist families in becoming first-time homebuyers by helping them to
realistically evaluate their readiness for a home purchase, understand their financing and downpayment options,
and navigate what can be an extremely confusing and difficult process. Housing counseling agencies also provide assistance to homeowners who are facing mortgage delinquency and default. In addition, renters and homeless individuals also benefit from housing counseling services provided at HUD-approved agencies. There are 19 HUD-approved agencies in Vermont. The list can be found on www.fha.gov.

"The value of housing counseling cannot be overstated," said Caswell. "Housing education programs offered by
Central Vermont Community Action Council and other HUD-certified housing counseling agencies help families make informed choices before they take the important step of homeownership. Getting the correct information at the beginning of the process will help families avoid mortgage troubles later on."

Central Vermont Community Action Council provides services to residents of Lamoille, Orange and Washington Counties. Their Family Housing Partnership program brings together tenants, landlords, homeowners and lenders to assess family housing issues and to develop individual plans for each household. Last year, the Family Housing Partnership assisted 36 families that were at risk of losing their housing. This year, services will be expanded to
help homeowners who are facing foreclosure and other economic difficulties.

"With high costs of housing and home heating fuel prices predicted to top $3 per gallon, we anticipate more homeowners at risk of defaulting on their mortgages seeking assistance," said Carol Flint, CVCAC director of family community support services. "Unfortunately, many homeowners experiencing financial problems wait until the last minute to ask for help and by then what we can do is very limited. It's critical that these families take action
before it's too late."

This year with foreclosures on the rise, HUD is emphasizing the importance of housing counseling services more
than ever because many housing counselors offer assistance to homeowners who are facing mortgage default or delinquency.

When announcing the funding to Central Vermont Community Action Council, Mr. Caswell also discussed a new program that may help homeowners who are facing foreclosure. The program - FHA Secure - will be administered
by the Federal Housing Administration, the branch of HUD that insures mortgages against default.

Under the FHA Secure plan, FHA will allow families with strong credit histories who had been making timely mortgage payments before their adjustable loans reset to a higher rate, but who are now in default, qualify for refinancing.

"FHASecure is designed for people who are good borrowers, but were steered into high cost loans with teaser
rates," said Caswell.

Traditionally, the FHA has provided first-time homebuyers, as well as homebuyers with less than perfect credit,
with a safe alternative to high-cost financial and non-traditional loan products. The FHA Secure initiative will
operate under the same safe guidelines as the FHA's existing mortgage insurance program - eligible homeowners
will be required to meet strict underwriting guidelines and pay a mortgage insurance premium, which offsets the risk
to FHA's insurance fund at no cost to the taxpayer.

FHA Secure, like all FHA products, will continue to offer unprecedented foreclosure prevention assistance. The
FHA has never permitted and will not include pre-payment penalties or teaser rates that are common in exotic mortgages and have caused much of the current market troubles.

To qualify for FHA Secure, eligible homeowners must meet the following criteria:

1. A history of on-time mortgage payments before the borrower's teaser rates expired and loans reset;
2. Interest rates must have or will reset between June 2005 and December 2009;
3. Three percent cash or equity in the home;
4. A sustained history of employment; and
5. Sufficient income to make the mortgage payment.

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For more information about FHA Secure and other homeownership and foreclosure prevention programs, please contact Central Vermont Community Action Council at 800-639-1053, or any of the 19 local HUD-certified housing counseling agencies in Vermont. For the list, visit www.fha.gov.