In 2010, the official unemployment rate stood at around 10 percent, and there were 5 people looking for every job that was available.

Last August, the Treasury Department announced that unemployed homeowners could get a 3-month forbearance on their mortgage payments while they looked for a job.

Unfortunately, the program, called the Home Affordable Unemployment Program (UP), has barely made a dent. In a year, just 10,000 homeowners have been able to take advantage of the program. That’s barely a rounding error when you consider that some 7 million jobs have been eliminated since the Great Recession started, and some 13 million Americans are unemployed.

Moreover, nearly half of all those who are unemployed, have been unemployed for at least six months. That’s the highest number since the Great Depression, according to the Labor Department.

If you’re unemployed for six months, getting a three month break on your mortgage doesn’t help much. So, last week, Treasury announced that it would be extending the minimum forbearance period under the program from 3 months to 12 months, to reflect longer periods of unemployment.

According to Andrea Risotto, a public affairs officer at Treasury, “Participation in the Making Home Affordable Program is voluntary. Over 120 servicers have signed up to participate in the program.”

However, according to Melanie Roussell, a spokesperson for the Department of Housing and Urban Development (HUD), if you have an FHA loan, your lender is automatically participating in the program. If you are already in a forbearance program, your lender is required to extend your forbearance up to 12 months.

Risotto said that the new program starts August 1, 2011 and the 120 loan servicers that will be participating have 60 days to get the program up and running.

“Participating mortgage servicers of non-GSE loans do need to offer the program to eligible unemployed homeowners whenever possible under regulator and investor guidelines,” Risotto explained.

Who is eligible for the program? According to the website, the following criteria must be met: You are unemployed and eligible for unemployment benefits, you occupy the house as your primary residence, you make your request for help before you’ve missed three payments, you have not previously received an UP forbearance or HAMP modification, and you obtained your mortgage on or before January 1, 2009.

The website notes that the eligibility criteria are for homeowner “guidance only.” In other words, there’s no guarantee that even if you are unemployed and closed on your mortgage on or before January 1, 2009, that you will be able to get a mortgage forbearance.

According to Roussell, the best thing you can do is contact a HUD-certified housing counselor. You can find one by calling 888-995-HOPE or going to

If you look at the Making Home Affordable HAMP program, the misinformation that was distributed about the program (i.e. that if you get into a trial modification and make three on-time payments, your trial loan modification will be converted to a permanent loan modification) caused – and continues to cause – a tremendous amount of consternation for homeowners in trouble.

Will this program be run any better? We’ll have to see. In the meantime, homeowners can find the list of participating servicers by visiting Click on the link that says “Get help if unemployed.” For a list of servicers that participate, go to