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WBill54

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Credit impact when obtaining assistance from Federal Hardest Hit Program
Is there a negative credit impact when using mortgage assistance from the Federal Hardest Hit Program. Certain states are allocated money to assist homeowners who have financial hardship. The mortgage loan is considered to be a lien during the time period. One program allows for payment of monthly mortgage for up to 24 months or approximately $32-34K, whichever comes first. Amount borrowed is at 0% and the debt is forgiven 20% per year and totally forgiven after 5 years as long as you stay in the home. The debt is considered to be a lien during the period.

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I don't think it would affect your credit score.  I'm assuming all the damage has been done to your score and there are already late payments on the account.  Once they get it current, it should help your score.  The only negative I can think of is if you were to apply for a mortgage and when the potential lender looks at your report, that account is going to have a comment similar to "paid through by government insurance/assistance".  That may cause a red flag for a potential mortgage lender.  

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Credit impact using Federal Mtg Program

Thanks for your response.  Good point regarding how potential lenders might look at this. 

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