Oregon is getting almost $50 million in additional federal money to try to stem foreclosures because its unemployment rate remains so high, the state learned Wednesday. An undetermined portion of that money will come to Central Oregon, especially hard-hit by joblessness and collapsed housing prices.

Oregon Housing and Community Services, already planning to spend $88 million in federal money on foreclosure prevention through four programs it hopes to launch at the beginning of 2011, will get another $49.3 million.

Federal restrictions

However, because of federal restrictions, OHCS may only be allowed to use the extra money for one of those programs, which provides unemployed or underemployed homeowners temporary help paying a mortgage.

As the $88 million plan stands now, OHCS has dedicated $16 million to help with mortgage payments for the unemployed, underemployed or those in significant financial distress.

If the department is only able to use the additional $49.3 million on programs targeting unemployment, officials may try to transfer the $16 million to the three other programs, leaving the $49.3 million for mortgage payment assistance, said Michael Kaplan, the state’s administrator of the $88 million program.

“We need to have some additional conversations with Treasury” about whether the $49.3 million also can be used for the three other programs, Kaplan said. Nonetheless, Kaplan is happy to get the extra money.

“It’s a big win,” he said.

OHCS plans to use 80 percent of the $88 million in the state’s 20 worst-off counties, a group that includes Deschutes, Crook and Jefferson counties. Though the Treasury estimated the four approved programs could help at least 7,400 people statewide, OHCS believes that number is closer to 6,000. Kaplan isn’t sure how many more people the additional money may help.

High unemployment

Oregon was targeted for more housing aid because its unemployment rate averaged 11.1 percent in 2009, while the U.S. rate was 9.3 percent. As of June 2010, Oregon’s jobless rate was 10.5 percent, 1 percentage point higher than the U.S.

In addition to the extra $49.3 million for Oregon — included in a $2 billion deployment of funds for 17 states and the District of Columbia — the federal government announced another program Wednesday. It provides $1 billion nationally for no-interest, nonrecourse loans of up to $50,000, good for up to two years.

The program is intended for people who are having difficulty paying a mortgage but may not qualify for the other federal assistance. Eligible borrowers must be three months’ delinquent on mortgage payments but be “reasonably likely” to resume payments with help of the loan, among other qualifications.

The loan program will be overseen by the U.S. Department of Housing and Urban Development but run through a variety of state and nonprofit groups, according to a Treasury news release. More details will be revealed in coming weeks.

“Together, these initiatives represent a combined $3 billion investment that will ultimately impact a broad group of struggling borrowers across the country,” Bill Apgar, Housing and Urban Development’s senior adviser for mortgage finance, said in the news release.

Last week, the U.S. Treasury approved four of OHCS’s five proposed ways to spend the $88 million, which is a part of the White House’s Hardest Hit Fund program to aid homeowners facing foreclosure. The fifth program, not yet approved by Treasury, would directly affect Deschutes County residents who are under water on a home loan — meaning they owe more on the loan than the home is worth.

Kaplan still hopes the underwater loan program will eventually be approved. It would use $10 million as a revolving loan to buy underwater loans in Deschutes and Jackson counties from lenders and refinance new loans for the homeowners through new lenders.

Along with the temporary mortgage payment assistance program, OHCS’ other programs include giving loan servicers one-time investments to spur loan modifications, another to pay down borrowers’ loans and another to provide moving assistance to those who must leave foreclosed homes.

All the programs are intended to complement the federal government’s Home Affordable Modification Program, which offers a smaller incentive to banksto rework loans.

During a conference call with reporters Wednesday, Herb Allison, assistant Treasury secretary for financial stability, said $50 billion of Troubled Asset Relief Funds has been set aside for housing programs, including HAMP. He said the Treasury is constantly readjusting how that money will be allocated, and the latest deployment of funds is based on feedback the department has received.

‘We know there is a need’

Asked why the Treasury is giving states more money before the programs have been proven to work, Allison said there’s significant interest in state housing finance agencies being allowed to implement these programs.

“We know there is a need for this funding locally,” he said.

Eligibility for the programs depends on individual situations and is determined by federally approved counselors, such as NeighborImpact in Redmond, with whom homeowners seeking modifications or mortgage payment assistance can consult.

For additional information, visit www.oregonhomeowner help.org.