Federal Foreclosure Assistance Goes Unused in South Carolina

Uncle Sam has money for you?

The Hardest Hit Fund was created by the Obama administration in 2010 to help those homeowners struggling with missed payments and foreclosure.  South Carolina has received about $295 million from the federal government to fund the program, yet only about $30 million has been used so far.   So what’s the problem?  Why are these funds, available to help make mortgage payments so people don’t lose their homes in foreclosure, going unused?

The Hardest Hit Fund was used to create SC Help, also accessed as www.scmortgagehelp.com, and focuses on homeowners who are unemployed, or who have gotten behind in mortgage payments through circumstances beyond their control, such as medical bills.  The federal program allows each state to use the money as it sees fit, targeting the most significant problems in its communities.

Perhaps the biggest problem is that people don’t know about the program.  When the program first started, I thought that they would be overwhelmed with applications, and feared that the money would run out.  I remember I advised clients not to delay applying, because once the money is gone, its gone.  But I’ve seen and heard very little about the program in the South Carolina media, so the word just hasn’t gotten out.

Perhaps another problem is that people think that SC Help is the same as, or part of, the HAMP program, and believe that when they have applied for HAMP, they’ve applied for this assistance, too.  But the only thing the two programs have in common is that they are created by the federal government.  The HAMP program provides incentives for mortgage lenders to modify your mortgage.  In other words, when the lender agrees to lower your interest, they receive some compensation for the loss they are taking.  The SC Help program actually provides money to make your regular payments, usually while you are unemployed.  It does not require a mortgage modification, and is therefore a better fit for many who don’t qualify for mortgage modification.

Unfortunately, like HAMP, your mortgage lender has to agree to accept payments through SC Help, and that may be another reason the program is not using the money it has.  Most of the lenders who don’t accept payments from SC Help are small, local lenders, who may not be set up to handle the administrative requirements, but one large lender, TD Bank, also refuses to participate, for reasons I find mysterious.

I also wonder if another reason more people haven’t applied for help is that the application has to be filled out online.  As strange as it may seem to most of us, there are still people out there who don’t own a computer, and who don’t turn to Google as their first source of information on any given subject.  I still talk to a few people in my practice who don’t have e-mail, or who don’t have easy access to it for financial reasons.  Of course, if you are reading this blog, you obviously have access to an online application, but if you know someone who doesn’t, offer to help, or refer them to the various consumer assistance and homeowner counseling services that can help with the application process.

It has also been suggested that the program us not used because people think it’s a scam, and I totally get this.  If you heard on the street that there is this fund of federal money and they were giving it away to make your mortgage payments for you, you could be forgiven for skepticism.  But, it is a real, honest-to-goodness program, administered by the state, funded with federal dollars, that might benefit you if you have fallen behind in your mortgage payments because of circumstances that are beyond your control.  If you haven’t already done so, apply for help.  It may be just the thing you need to help you avoid foreclosure.


Däna Wilkinson (pronounced "Donna") is a bankruptcy lawyer practicing in Spartanburg, South Carolina and serving South Carolina's upstate region, including Greenville, Spartanburg, Gaffney, Union, Anderson, Easley and Pickens. She has been in practice for more years than she cares to count, but it’s more than 20 years. Däna has been a bankruptcy lawyer from the very beginning of her career as a lawyer.

Däna went to law school at the University of South Carolina, where she was Student Works Editor on the South Carolina Law Review and a member of the Order of Coif. She started doing bankruptcy work while still a student, working for a bankruptcy boutique firm whose members included a Chapter 7 panel trustee, and recognized experts in Chapter 11 reorganizations. She enjoyed the work from the beginning, and upon graduation took a job as a law clerk to the Honorable Rodney Bernard, bankruptcy judge for the Western District of Louisiana. Judge Bernard had spent a number of years on the bankruptcy bench, and was an excellent teacher and mentor. Upon Judge Bernard’s retirement, Däna stayed on for a time as clerk to the Honorable Donald W. Boe, until homesickness for South Carolina struck, and she returned to private practice in Charleston. Four years later, she received an offer to return to Columbia, where she practiced until 1997.

In 1997, planning to start a family, Däna decided to return home to the Upstate, and opened her own practice in Spartanburg in 1998. Over the years, Däna represented all sorts of parties in bankruptcy: business debtors in reorganization, individual debtors, creditors and creditors’ committees, and trustees. In establishing her own practice Däna decided to focus on consumer debtors, ordinary people who find themselves overwhelmed by debt. Her focus is on the individual needs of clients, and on crafting a solution to their unique financial needs. She is committed to helping clients make a fresh start, and preserving their dignity in the process.

Däna is the proud mother of a beautiful, talented and very active daughter, who is, as her mother says, “practically perfect.” She is also active in both church and community activities, all of which means that there is a fair chance that any given blog post was written while in the car pool line or while waiting for a hearing or a meeting to start.

Däna is also certified as a bankruptcy specialist by the South Carolina Supreme Court, which means that she has taken and passed a proficiency examination on bankruptcy law, devoted her practice to bankruptcy for a number of years, and continues to take classes on bankruptcy law and related issues.

Contact information for Däna Wilkinson:

Law Office of Däna Wilkinson
365-C East Blackstock Road
Spartanburg, SC 29301
(864) 574-7944
[email protected]

Däna also blogs at www.bankruptcylawnetwork.com.


  1. Peter Colby says:

    I can’t thank you enough for writing and publishing articles related to bankruptcy and foreclosure. You have provided me tremendous insight into two processes – neither of which I look forward to employing.

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