Road Home tweaks to help struggling homeowners approved

More leeway given to help homeowners

Federal officials have approved three policy changes to the Louisiana Road Home program that will provide relief to families that, for various reasons, including contractor fraud, have spent at least part of their grant money, but been unable to rebuild and reoccupy their hurricane-damaged homes.

Under rule changes approved by the U.S. Department of Housing and Urban Development, the state agency administering the Road Home program is allowed to offer new grants to homeowners and write off outstanding debt in an effort to bring more homes into compliance with the state recovery program.

“Now that these Action Plan Amendments have been approved, our Road Home staff has additional tools to help homeowners to finish their homes and bring them into compliance,” said Pat Forbes, executive director of the Louisiana Office of Community Development. in a statement.

The changes come as three amendments to the rules for Road Home, created to help people whose homes were destroyed by hurricanes Katrina and Rita.

The first applies to homeowners who either owe money to the program or who closed on their grant, but have not fulfilled the terms because of reasons beyond their control, including contractor or builder fraud, involuntary forced mortgage payoff, theft or vandalism, damage before repairs were completed and installation of contaminated drywall. If a homeowner can document one of those circumstances, the state now has the ability to subtract that amount of the damage from the total amount the homeowner owes to the state.

The second amendment allows for a loan repayment grant of up to $150,000 per applicant that can be used to repay the principal on a construction loan to finish repairs. Homeowners would have to be able to qualify for such a loan to be accepted into the grant program.

The third change attempts to fix the state’s troubled elevation award program. The new rule allows homeowners who had to use Road Home elevation grants to instead make repairs to their homes to subtract the amount paid for those repairs from the amount owed to the state. The program applies only to homeowners still identified as noncompliant under the program’s rules.

Letters will go out to homeowners who are not in compliance with the Road Home grant agreement beginning Aug. 26. The letter will contain a “compliance questionnaire” that must be completed and returned. Forbes also said that homeowners who are not in compliance can call the Road Home or attend one of the outreach events the state agency will have in the coming months.

“In either case, our staff can work with the homeowners to determine if they qualify for any of these additional tools and what their best path to compliance will be,” Forbes said. “The important thing is for the homeowner to touch base with the program staff.”