At 79, Joseph Oates knows he can't wait forever to get mortgage help. But he's beginning to feel like he might have to.
In September 2013, the retired railroad worker applied to Florida's Hardest Hit Fund for a program that would pay down his mortgage by up to $50,000.
Finally, last week, Oates got approval from state underwriters. But his application now goes to his bank for review, which could take another six weeks. And he still doesn't know how much relief he'll get.
"Once again, I'm in limbo,'' said Oates, who is struggling to pay the $137,000 he owes on his modest house in Seffner, a small town between Tampa and Plant City in Hillsborough County.
Oates' lament is familiar to many other homeowners who have sought assistance from the $7.6 billion Hardest Hit Fund, created by the U.S. Treasury in 2010 to help cut the foreclosure rate in Florida and 18 other states hard hit by the housing bust. Critics say Florida has been slow to distribute money to desperate homeowners, a complaint supported by reports that states file with Treasury officials.
As of the three months ended in September, Florida had spent 44 percent of its $1.1 billion share of Hardest Hit Fund money. That's less than all but four other states. Oregon had paid out 90 percent of its allotment, Rhode Island 87 percent.
And in raw numbers, Ohio and Michigan are ahead of Florida in providing relief to struggling homeowners even though they have smaller populations. Nearly 23,000 people in each state had received help by October, compared with fewer than 20,000 in Florida.
"If Florida is lagging behind, it's an embarrassment and shows a lack of concern for the folks who've been hit the hardest,'' said Ryan Brown, a spokesperson for Sen. Bill Nelson.
At Nelson's request, the Treasury Department has been investigating issues raised in a 2013 Tampa Bay Times story, which reported that Florida's Hardest Hit Fund was slow in helping honest homeowners while giving aid to felons and tax cheats.
Officials of the Florida Housing Finance Corp., the state agency that administers the Hardest Hit Fund, say they are on pace to use all of the money.
"Florida Housing is disbursing between $18-19 million each month in HHF program dollars,'' spokesperson Cecka Rose Green said in an email. "At this rate, we will expend the funding before the sunset of the (federal) program in 2017.''
Florida's Hardest Hit program got off to a slow start because of opposition by Gov. Rick Scott to federal stimulus programs and the decision to begin with a pilot project in just one county, Lee.
Until last year, the state primarily used Hardest Hit funds to temporarily make mortgage payments for homeowners who had lost their jobs or suffered big drops in income.
But with so many Floridians owing far more then their homes were worth, critics said the money would be better spent on reducing the principal amount, thus lowering monthly payments to affordable levels.
In September 2013, the state announced its Principal Reduction Program. Open to low- to moderate-income homeowners less than 60 days late on their payments, it would pay down the balance on underwater homes purchased before January 2010 by up to $50,000.
Among the 25,000 people who applied in the first few days — so many that the state had to cut off applications — was Oates of Seffner.
Oates, who worked miscellaneous jobs after retiring from CSX in the mid 1980s, owes $137,000 on his house, which is valued at $82,563.
"I was hoping to get a $50,000 reduction in my loan because I'm way under water, I've been living here almost 20 years, and I've always been up to date'' on payments, he said. "I meet all the criteria they ask for.''
Oates said he was assigned an adviser in Miami and "sent (him) all of my personal bank records and that sort of thing.'' Then he waited.
A year later, "I hadn't heard anything, so I wrote again. He said the underwriters had been taking a long period of time, three to six weeks."
Last week, Oates received an email from the adviser: "Your file has been approved by underwriting and sent to your lender for final sign-off. They have been taking abut six weeks to get back with me.''
Nearly 15 months after he first applied, Oates is troubled by two things.
"I have bared all of my personal financial information to people that I do not know, leaving me open for identity theft, and on top of that I still do not have the money. I felt I was getting the runaround.''
Green of Florida Housing Finance Corp. said she was not familiar with Oates' case and could not comment on it. In general, she said, it takes two to three weeks for underwriters to review the applications.
However, "the length of time the lender takes to send an approval is not controlled by (the Hardest Hit Fund) nor is the length of time it takes for applicants to initially get in all requested and required documentation,'' Green said.
Another homeowner who applied for the Principal Reduction Program in September 2013 was Brian England of Tampa. He said the process was so slow that he fell behind in his payments by over two months and thus no longer qualified.
Luckily, though, going into default made England eligible for the Hardest Hit program that helps with monthly mortgage payments. He applied to that in January; seven months later, on July 29, he was approved for up to $42,000 in mortgage assistance on his condo.
"It does take a long time, but you just got to stick with it, you just got to keep after them,'' said England, a former mortgage consultant. "I finally got approved because my mortgage company started the foreclosure process, so they pulled me to the front (of other applicants). So that helps.''
Florida Housing Finance Corp. reopened the Principal Reduction Program last spring and continues to take applications.
So far, 25,000 Floridians have been rejected for Hardest Hit help and 23,000 are still waiting. Yet a small group of homeowners has benefitted from another Hardest Hit program that was never publicized and is open only to people years behind on their mortgage payments.
Called ReStart, the program uses a mix of private and Hardest Hit money to slash the balances on severely delinquent, federally insured mortgages.
Here's how it works: The Department of Housing and Urban Development auctions the mortgages at a deep discount. In return for getting a bargain price, the buyers forgive a large part of the loan balance. Hardest Hit money is used to further pay down the mortgage amount, making the payments low enough that the homeowner can resume making them.
The results are dramatic. One Tampa couple had the amount they owed cut from $241,553 to $86,000.
Florida has earmarked $50 million for just the ReStart program, but so far only 65 families statewide have qualified. With so many other homeowners desperate for relief, has there been any talk of using some of that $50 million to help them?
"At this time we are keeping with the current earmark for this (ReStart) program,'' Green said.
Contact Susan Taylor Martin at firstname.lastname@example.org or (727) 893-8642. Follow @susanskate.