A number of state and local housing finance agencies have developed special loan products to prevent foreclosures among families that cannot qualify for traditional refinancing products and have been unable to obtain modifications to their existing loan to make the loan more affordable. Loans geared toward foreclosure prevention tend to have less restrictive underwriting requirements and/or more suitable loan terms than private-market loans. Foreclosure prevention loans take a variety of different forms that all aim to help families stay in their homes whenever possible. Depending on local needs and resources, this may involve silent second mortgages and shared appreciation loans, low-interest refinance loans, and short-term emergency loans. Examples of each approach are provided in this section.

The following table describes three categories of financial problems that may lead to foreclosure, financial assistance options that can prevent foreclosure in each of these cases, and some examples of communities that have implemented each of these approaches. Click on a policy option to learn more, or click on any state to jump to an example.

Cause of Mortgage Delinquency	Short-term crisis (job loss, medical emergency, etc.)	Unaffordable mortgage terms and minimal refinance barriers	Unaffordable mortgage terms and serious refinance barriers
Community Options	Short-term emergency loans	Low-interest refinance loans, possibly with flexible underwriting requirements	Refinancing with flexible underwriting requirements, silent second mortgages, or shared appreciation loans
Examples	Delaware, New Jersey, North Carolina, Pennsylvania	Connecticut, Massachusetts	New Jersey, North Carolina

Click on the links below to learn more about loan products that can help families avoid foreclosure: Grant short-term emergency loans to help with temporarily unaffordable mortgages caused by issues such as job loss or illness Make available low-interest refinance loans for homeowners with unaffordable mortgage terms that do not owe more than the home's value Offer refinancing with flexible underwriting requirements, silent second mortgages, or shared appreciation loans for families in deep financial distress

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You are currently reading: Offer a range of suitable refinancing products and emergency loans Other pages in this section: Collaborate with lenders and servicers to obtain better terms for existing borrowers Skip to: Counseling, Mediation and Legal Assistance Linking homeowners with both outside experts and neutral third parties can help families understand their options and reach a resolution that avoids foreclosure and its related costs for families, communities, and mortgage servicers. Extending the Foreclosure Timeline Extending the process of home foreclosure through a temporary moratorium on foreclosure or by increasing the notice period required before a foreclosure may take place may allow homeowners additional time to reduce the financial damage of foreclosure. Reduce the Risk of Foreclosures in the Future Foreclosure risks are often identifiable and preventable many years in advance. Governments can counter these risks through targeted outreach, regulations to prohibit the riskiest loans, and enhanced consumer awareness to help families make better mortgage decisions. Click here for more resources on preventing foreclosure.