Louisiana OCD-DRU Hardship Criteria for Homeowner Populations with Incomes Exceeding 120 percent AMI
The state proposes the below hardship criteria representing situations in which it may determine it is both necessary and reasonable to provide CDBG-DR assistance households with incomes exceeding 120% AMI who drew SBA funds:
- Hardship due to housing cost burden.
Individuals who spend more than 30% of their monthly gross income on housing costs are expected to experience hardship in recovery due to having limited financial resources
- Hardship due to SBA loan repayment.
Individuals who spend more than 15% of their monthly discretionary income on SBA loan repayment are expected to experience hardship in recovery due to having limited financial resources
- Hardship due to advanced age.
Individuals who are of an advanced age and are retired or for whom retirement is expected during the repayment period of the SBA loan. The reduced income or anticipated reduction of income that comes with retirement is likely to cause a hardship during the loan repayment period
- Hardship due to cost of caring for dependents. Homeowners responsible for providing care to parents, children, grandchildren, and other dependents have long-term financial commitments to consider when contemplating incurring additional debt. Additional debt would be a burden and limit available resources needed to provide for dependents
- Hardship due to major illness and/or death of wage earner. Households that have experienced a major illness or death of a household wage earner are anticipated to experience hardship in repaying SBA loans and completing recovery
- Hardship due to costs associated with higher education for self or dependents. Tuition and living expenses for dependents in higher education present significant financial needs to homeowners. Household resources are strained to accommodate education-related expenses and homeowners may not have adequate monthly cash flow to support an additional note
- Hardship due to loss of employment or reduction in income. A loss of income or job following the qualifying disaster event can impact the ability to repay a loan
- Hardship due to costs associated with disability and/or special needs. Additional costs related to evacuation, relocation, and rebuilding for a disabled/special needs household puts an increased burden on financial resources that might otherwise be contributed to recovery
- Hardship due to depletion of retirement account. Households who withdraw funds from their retirement account(s) after the qualifying disaster are anticipated to experience hardship during the repayment period of their SBA loan due to the loss of future retirement income.
The state of Louisiana adds the following line to Action Plan Amendment 12.
Additional criteria may be added or considered on a case-by-case basis. Should this scenario arise, the state will consult with appropriate HUD representatives for guidance prior to calculating any award adjustment.