Illinois Hardest Hit Fund Proposal 

September 1, 2010 
Illinois Housing Development Authority 2 

Section A: Overview of the Illinois HHF Homeowner Emergency Loan Program 

(HHF HELP) 

On August 11, 2010, the Obama Administration announced a $2 billion expansion of the 

existing Housing Finance Agency Innovation Fund for Hardest Hit Housing Markets 

Program (HHF). These funds would be used by nine of the original ten HHF states and 

an additional seven states and the District of Columbia. States included in this expanded 

third phase of the program were: Alabama, Georgia, Illinois, Indiana, Kentucky, 

Mississippi, New Jersey and Tennessee. Funds must be used to offer an unemployment 

bridge program that will pay a portion of a borrower’s mortgage payment while 

unemployed or substantially underemployed. These areas of the country were selected 

due to sustained high unemployment over the past twelve months. The Illinois Housing 

Development Authority (IHDA), the housing finance agency in Illinois, will receive the 

funds for disbursement. The allocation for Illinois was $166,352,726. If approved by the 

U.S. Department of Treasury, IHDA will utilize these funds to implement the Hardest Hit 

Fund Homeowner Emergency Loan Program (HHF HELP). 

Background 

Illinois is excited about the opportunity to provide these much needed dollars to 

homeowners struggling to meet their mortgage obligations in a difficult economy. Large 

numbers of Illinois homeowners have been affected by a difficult combination of 

increasing unemployment, declining property values, and rising foreclosures. 

The unemployment rate in Illinois has more than doubled since 2006 to 10.3% as of the 

first quarter of 2010 with some particularly distressed counties experiencing rates as high 

as 15%-- leaving almost 700,000 Illinoisans currently unemployed. The average length 

of unemployment at the end of 2009 exceeded six months. Manufacturing and 

construction jobs were among the first to suffer in the current economy, but the slow job 

market now cuts across all job sectors in Illinois. The median home sales price in Illinois 

has fallen almost 25% since 2006, according to the Illinois Association of Realtors. In 

some Illinois counties, the reduction in price has been as high as 40%-60%. These drops 

in employment, and decreased home values, have contributed to huge increases in 

foreclosure filings in the past five years. According to Realtytrac, between January 2009 

and June 2010, over 130,000 properties in Illinois received an initial foreclosure filing. 

In response to the tough economic challenges facing Illinois and the destabilizing nature 

of foreclosure, IHDA and other state agencies and organizations have enacted programs 

to assist homeowners and lessen the impact of foreclosure on surrounding communities. 

Foreclosure mitigation activities undertaken by or with IHDA support include: National 

Foreclosure Mitigation Counseling Program (NFMC), Cook County Mortgage 
Illinois Housing Development Authority 3 

Foreclosure Mediation Program, Neighborhood Stabilization Program (NSP), Predatory 

Lending Database Capacity Building Grant Program (PLD) and Foreclosure Outreach 

Events. Brief descriptions of each of these activities are below: 

National Foreclosure Mitigation Counseling Program (NFMC)

IHDA applied for NFMC grant funds in order to enable non-profit counseling agencies 

across Illinois to provide foreclosure counseling to homeowners in danger of foreclosure. 

NFMC funds Housing Finance Agencies and other HUD approved housing counseling 

intermediaries to provide foreclosure intervention and loss mitigation counseling. The 

goal of the funding is to expand and supplement counseling opportunities available to 

families facing delinquency and foreclosure. NFMC was administered through a 

competitive application process by NeighborWorks® America, within guidelines defined 

by Congressional legislation. 

IHDA has developed a strong network of housing counseling agencies to assist 

homeowners; partner agencies employ more than 120 foreclosure counselors throughout 

Illinois. IHDA has participated in four rounds of funding under this program, receiving a 

total of $7.5 million since March 2008. Through the first three rounds of the 

program, over 12,000 Illinois homeowners facing foreclosure received counseling 

services free of charge. 

Cook County Mortgage Foreclosure Mediation Program

The Cook County Mortgage Foreclosure Mediation Program provides free assistance to 

Cook County homeowners in foreclosure. An unprecedented partnership between the 

Circuit Court of Cook County and several state and local organizations, the program was 

designed to provide homeowners with critical support and help them explore options to 

either stay in their homes or negotiate a respectable exit as early as possible once the 

foreclosure process begins. 

IHDA acts as the administering agent for the housing counseling component of the 

program. IHDA screened, selected, and continuously monitors the housing counseling 

agencies providing counselors for on-site and off-site help to homeowners. IHDA also 

operates a toll-free help line used to schedule clients for meetings with a housing 

counselor and an on-site attorney to discuss the counselor’s recommendations and 

prepare for a court date that will determine whether the foreclosure case can be mediated 

with the lender. The Cook County Board approved $3.5 million in funding for one year 

of the program which officially started on April 12, 2010. 

Neighborhood Stabilization Program 

Enacted by the Housing and Economic Recovery Act 2008 (HERA), Neighborhood 

Stabilization Program (NSP) is a federal resource appropriated to assist states and 

communities to address the detrimental impact of vacant and foreclosed properties on 

communities. All NSP activities must benefit households and communities of low, 

moderate, or middle income. 

Lead administrator responsibilities for NSP in Illinois were assigned to IHDA and 

approved by the U.S. Department of Housing and Urban Development (HUD) in 
Illinois Housing Development Authority 4 

December 2009 in order to take advantage of the agency’s experience in financing and 

developing of affordable housing. IHDA works in partnership with many of the state’s 

departments to coordinate investment of housing resources throughout the state. 

HUD allocated $53 million to the state of Illinois for implementation of the program. 

Eligible activities under NSP include: acquisition and rehabilitation of vacant and 

foreclosed buildings and land for homeownership or rental; financing mechanisms for 

new homeownership of foreclosed properties; demolition of blighted properties, land 

banking, and redevelopment including conversion of non-residential property or new 

residential construction on vacant land. IHDA has effectively implemented the program 

with 18 selected sub-grantee agencies and will obligate 100% of the NSP resources by 

the 18 month obligation deadline of September 4, 2010. 

Anti-Predatory Lending Database Program 

In 2007, the Illinois Legislature passed Senate Bill 1167 (Public Act 95-0691), requiring 

that all mortgage loans originated by State-licensed lenders in Cook County (Illinois’ 

most populous county) be entered into a database monitored by the Illinois Department of 

Financial and Professional Regulation. Originally a 10 zip code pilot program, the AntiPredatory Lending Database Program (APLD) program has expanded to all of Cook 

County and recently to Kane, Peoria and Will Counties. 

 

The database serves to collect information on mortgage loans that have potentially higher 

risk characteristics. Borrowers contemplating these products are subsequently required to 

undergo a file review session performed by a local HUD-approved housing counselor at 

no charge. The counselor reviews and re-enters all loan information into the database 

and explains the long-term ramifications of the mortgage to the borrower who then solely 

decides whether they move forward with the closing.

IHDA was appropriated $3,500,000 under the Residential Real Property Disclosure Act 

for the purpose of making grants to build capacity in HUD-certified counseling agencies 

participating and committing to provide services as needed for the APLD program. 

Participating counselors must provide borrowers with file review sessions as needed, and 

IHDA has committed capacity building support to 38 counseling agencies in the 

program’s four-county area. 

 

Foreclosure Outreach Events

Beginning in November 2007, IHDA has hosted and/or participated in foreclosure 

prevention events throughout the State tailored to the specific needs of various 

communities. Thousands of homeowners have attended the events to learn about options 

and solutions available to them relating to foreclosure. IHDA has collaborated with the 

Illinois Department of Financial and Professional Regulation, the Attorney General’s 

office, Neighborhood Housing Services of Chicago, the Chicago Community Trust, and 

various non-profit organizations and local governments to provide households facing 

foreclosure with information and services. Participation at these events often includes 

local banks, servicers, title companies, and law service agencies that can provide face-toface assistance to households. 
Illinois Housing Development Authority 5 

HHF HELP assistance is a badly needed resource that connects well to these existing 

efforts by providing direct mortgage assistance to borrowers facing foreclosure. HHF 

resources will help fill the gap to prevent foreclosures, providing a safety net for 

homeowners and deter further decline of home values and instability in communities. 

Program Goals 

Given the short time frame of the proposal required by Treasury, extensive stakeholder 

participation in the formation of HHF HELP was not feasible. However, IHDA’s 

previous foreclosure mitigation activities have included participation in many discussions 

with stakeholders about the nature and response to the crisis. These discussions have 

helped IHDA form the following program goals to be used as a guide during the 

development of the program: 

 

• Assist low and moderate homeowners retain their homes; 

• Use existing networks and infrastructure as much as possible to support HHF 

HELP; 

• Intervene as early as possible to increase the number of individuals who can avoid 

foreclosure and maximize the likelihood of sustained homeownership; 

• Maximize resources through effective and efficient programming, including the 

use of web-based technology; 

• Create reporting tools that allow for program transparency and accountability; 

• Target funds to communities that have been hardest hit by foreclosure and 

unemployment. 

Program Description

HHF HELP will provide Illinois homeowners at or below 120% of the area median 

income with a portion of their mortgage payment for up to 18 months while searching for 

a job or participate in job training. Homeowners located within Illinois’ counties of 

higher economic distress will be eligible for a maximum benefit of $25,000. 

Homeowners living in the remainder of the state will be eligible for a maximum benefit 

of $20,000. Assistance will be in the form of a deferred payment, no-interest loan 

secured by the homeowner’s property with a junior lien. The loan will have a term of ten 

years, with the principal amount forgiven monthly over the last five years of the term. If 

the homeowner chooses to sell or refinance the home within the ten year term, repayment 

will only be required if sufficient net equity proceeds exist to repay the outstanding 

amount of the loan. 

Eligibility for HHF HELP will require that all homeowners be documented as 

unemployed or deemed substantially underemployed due to no fault of their own. All 

households must demonstrate a reduction in income of at least 25%. The borrower’s 

mortgage payment must exceed 31% of their present household income. All 

homeowners must submit a hardship affidavit and provide documentation of income loss. 

Additionally, each borrower must submit an action plan outlining the steps they will take 

to regain financial independence and employment. While homeowners will not be 
Illinois Housing Development Authority 6 

required to be delinquent at the time of intake, they must not have more than three 

mortgage payments in liquid assets at the time of application for the program, excluding 

retirement funds. In order to increase the likelihood of sustained homeownership, 

borrowers must be no more than 6 months delinquent at the time of application intake. 

 

Homeowners will contribute 31% of their current monthly income to each monthly 

payment. The homeowner’s payment will be remitted to IHDA, who will make the full 

mortgage payment to the appropriate servicer on behalf of the homeowner. Homeowners 

will be required to demonstrate their ability to afford the mortgage prior to 

unemployment or substantial underemployment by providing proof of good payment 

history. Homeowners must have a current mortgage balance of less than $500,000 to be 

eligible. 

Implementation Structure 

Using the program goals as a guide, IHDA has developed a structure that builds on 

existing infrastructure and seeks to intervene early in delinquency. The program can be 

viewed in six major stages that work to streamline the approval and allocation of funds in 

an equitable way to eligible households statewide. The following flow chart provides an 

overview:
Illinois Housing Development Authority 7 

Program Marketing 

IHDA will market the program statewide through a broad range of outreach strategies. 

IHDA and the Illinois Governor’s Office will issue public announcements and press 

releases describing the program’s availability, parameters, and eligibility criteria. 

Additionally, IHDA will disseminate program information through housing counseling 

agencies, local homeownership departments, the Illinois Department of Employment 

Security (IDES), and other community organizations. IHDA will create a HHF HELP 

website to provide information about the program and intends to include a client prescreening function. The IHDA Marketing & Communications Department will spearhead 

all marketing efforts. 

Application Intake and Evaluation 

Client intake and evaluation will have two components: the counselor intake, and IHDA 

underwriting and processing. In order to further facilitate efficient tracking and reporting 

of the program, IHDA will undertake a Request for Proposals (RFP) process to procure a 

web-based client management system capable of interacting with IHDA’s existing 

systems, facilitating interface with counseling agencies, and reporting to Treasury. In 

addition, IHDA is examining the efficiencies gained by utilizing the services of a formal 

call center to answer questions regarding HHF HELP. Should IHDA determine that an 

outside call center is necessary, an RFP for those services would be required. 

Building on existing networks and capacity where possible, HHF HELP will utilize the 

network of housing counseling agencies built under the NFMC program to perform 

intake and pre-approval functions on the local level throughout the State. The NFMC 

counseling network features 42 counseling agencies with 120 counselors experienced in 

assisting troubled homeowners evaluate their options and apply for loan modifications or 

other assistance. 

For those counties underserved by this NFMC network, IHDA will expand the network in 

three ways. First, invite HUD-certified agencies not currently receiving NFMC funds 

through IHDA to participate in the program. Second, widen the network of agencies to 

include other local assistance organizations experienced in performing eligibility 

screenings and income certifications for other IHDA programs. These organizations 

would include community action agencies, regional councils, and other nonprofit entities. 

Third, IHDA will hire in-house housing counselors who perform these functions for 

Illinois homeowners over the phone. While the existing network will form the base, 

IHDA will undertake an application process to determine the final network of 

participating agencies. A list of IHDA’s network of agencies currently involved in the 

NFMC program and their service counties is included as Exhibit C. 

In order to effectively manage the intake and screening of eligible applicants, IHDA will 

utilize three possible entry points for applicants. First, a website will assist possible 

applicants in a self-screening. Second, a call center will answer questions and perform a 

pre-screening for HHF HELP. Third, applicants can contact a housing counseling agency 

in their area. All three entry points will perform a quick assessment for eligibility, inform 

the possible applicants of the documents needed to proceed and direct the applicant to the 

nearest housing counseling agency for a full eligibility screening. All borrowers 
Illinois Housing Development Authority 8 

considered for eligibility will meet with a counselor for intake processing in person or by 

phone, and provide all required income information, household information, and property 

documentation necessary to determine potential eligibility. 

If the housing counselor believes the client is eligible, the counselor will submit a full 

application package to IHDA. IHDA will review each file for compliance with program 

requirements, underwrite the file, and determine the assistance level. The client 

management system will maintain documents and assistance decisions electronically, 

increasing processing efficiency and accuracy. 

Loan Closing 

Following approval, the borrower will execute loan documents tailored by the IHDA 

Legal Department. The title company will record the loan documents and a lien will be 

placed on the property. It is IHDA’s intention, through a RFP process, to contract 

directly with a title company capable of providing these services for all borrowers with 

adequate statewide coverage. 

Loan Set Up and Portfolio Management

The Homeownership Department will transfer approved and closed loans to the IHDA 

Loan and Portfolio Management Department. Participant and loan information in the 

client management system will be uploaded to the IHDA loan servicing software to set up 

the payment schedule and terms. IHDA will make payments on behalf of the borrower 

until the borrower becomes substantially re-employed, reaches the program termination 

point, reaches their maximum available amount of assistance, or is removed from the 

program. The Loan and Portfolio Department will validate the loan for each client and 

track payments in the loan servicing software system. IHDA will monitor all outflow and 

inflow of program funds from Treasury and from borrowers through the IHDA general 

ledger. 

Funding and Draws

IHDA will make full mortgage payments on behalf of the borrower directly to the loan 

servicer on a monthly basis throughout the duration of the borrower’s eligibility. In cases 

where borrowers were in default, IHDA will make a one-time payment bringing the 

borrower current. This payment can include mortgage arrearages, late fees and penalties, 

homeowners’ association payments (if applicable), legal fees associated with the pending 

foreclosure, and other fees. While receiving the benefit of full monthly mortgage 

payments, the borrower is required to make partial payments of 31% of current income 

directly to IHDA. 

 

IHDA will draw funds from Treasury in bulk requests not exceeding 20% of the total 

program appropriation. Separate draw requests will be made for administrative expenses 

in accordance with funding guidelines provided from Treasury. 

Compliance and Monitoring

IHDA will be responsible for ongoing monitoring and compliance of the program 

requirements and participants for continuing eligibility. IHDA will add four dedicated 

compliance personnel responsible for monitoring client eligibility throughout the 
Illinois Housing Development Authority 9 

program. IHDA will work with IDES to implement cross checks of participants against 

existing employment information gathered on a continual basis, and coordinate reports to 

Treasury and conduct follow-up to examine homeowner outcomes. 

Pilot / Readiness Assessment 

In order to evaluate the readiness of HHF HELP for a statewide launch, IHDA will 

undertake a pilot program utilizing its current portfolio of first mortgages financed by 

IHDA’s Mortgage Revenue Bond program. This portfolio will offer IHDA a statewide 

distribution of loans with homeowners likely to meet the income requirements. Our 

existing relationship with the servicer of these loans will allow the opportunity to work 

collaboratively to evaluate and change processes during the pilot phase. IHDA will 

prepare a readiness assessment for process changes as needed prior to full program 

launch as required by Treasury. 

Timeline to Deployment of Funds 

IHDA will begin start-up activities related to the program immediately upon submittal of 

the proposal. Prior to Treasury approval, IHDA will: 

• Release a Request for Information for client management systems enabling IHDA 

to effectively manage applications to the program, in preparation of issuing a 

RFP; 

• Prepare an application process for housing counseling agencies and other possible 

partners to perform intake services under the program; 

• Develop a RFP for one or more title agencies to assist in the preparation and 

recordation of mortgage documents; 

• Prepare a RFP for website development, if necessary; 

• Develop position descriptions for new HHF staff. 

In the 120 to 150 days post Treasury approval, IHDA will undertake the following tasks 

supported by administrative dollars: 

• Prepare a standard note and mortgage for use with all program participants; 

• Refine and develop program guidelines for use by housing counseling agencies 

and servicers; 

• Develop documentation requirements for the program;

• Issue application for housing counseling partners; 

• Issue the RFP for title agencies and make selection; 

• Issue the RFP for appropriate client management software and make selection; 

• Prepare and issue a RFP for call center services and make selection, if necessary; 

• Train partners on program guidelines; 

• Hire program-specific HHF staff; 
Illinois Housing Development Authority 10 

• Complete and test client management software modules; 

• Outreach to servicers with program design; 

• Develop a full marketing and outreach plan; 

• Train housing counseling partners in client management software, program 

processes and procedures; and 

• Draw initial 20% of program funds for the pilot launch and administrative 

expenses. 

Following 120 to 150 days post Treasury approval: 

• Launch pilot program utilizing the current IHDA Mortgage Revenue Bond loan 

portfolio; 

• Test program systems; 

• Establish readiness to launch full program. 

At 90 to 120 days post-pilot launch IHDA will launch the full statewide program. IHDA 

anticipates deploying all program funds over a four-year period. 

Obstacles for Implementation 

 

IHDA identifies three main obstacles for program implementation: overwhelming 

demand, insufficient counselor capacity, and public misconception about the program. 

Considering Illinois’ foreclosure and unemployment rates, IHDA anticipates high public 

demand for this mortgage relief program. To address inflow of clients, IHDA’s HHF 

HELP website, referral network, and call center must manage a high volume of inquiries 

and ensure homeowners understand eligibility criteria prior to intake with a housing 

counseling agency. IHDA also intends to procure a web-based client management 

system capable of managing the data and document and data stream from counselors, 

IHDA, servicers and Treasury. The employment of such a system should maximize 

efficiency and enable all program partners to serve more clients. 

As counselor intake is required for the program, sufficient agency capacity and adequate 

statewide coverage is a programmatic concern. IHDA will augment local agency 

capacity by hiring additional housing counselors in-house and include some additional 

experienced organizations to serve intake functions in order to meet public demand. 

IHDA’s marketing efforts and referral network will effectively communicate the 

conditions and terms of the program and limit public misconception and false information 

about the program. 

Interaction with Existing Programs 

Illinois does not currently have an existing mortgage assistance program similar to HHF 

HELP. It is expected that some homeowners will have received a previous forbearance 
Illinois Housing Development Authority 11 

under the HAMP Unemployment Program; however, it will not be a requirement for all 

participants in HHF HELP. HHF HELP assistance may precede, follow, or run 

concurrently with the HAMP UP forbearance. Clients served through IHDA’s state and 

federally funded foreclosure prevention programs noted above will be evaluated for 

eligibility for HHF HELP. The existing programs utilize counselors in a role similar to 

their function outlined in HHF HELP. 

Section B: Population Served and Allocation Methodology 

IHDA estimates between 7,500 to 10,000 households will receive assistance through 

HHF HELP. The maximum level of household assistance will be $20,000 or $25,000 

depending on county location, but the terms and conditions of the program will see many 

homeowners receiving less than the total assistance amounts. Many households may 

have smaller monthly mortgage costs or may only need transitional mortgage assistance 

for a time period shorter than the maximum 18-month program term. It is expected that 

the average amount of assistance utilized through this program will be $15,000 per 

household. If a household needs a lesser amount of financial assistance, a larger number 

of households will benefit. 

The impacts of unemployment and foreclosure have been felt statewide and the potential 

number of eligible households for this program will vastly exceed the number of assisted 

households. Program participants will come from two groups, unemployed homeowners 

and substantially underemployed homeowners. As of June 2010, the total number 

unemployed people in Illinois was 708,035. According to 2008 American Community 

Survey Public Use Microdata Sample information (ACS PUMS), there are 3,301,796 

owner-occupied households in Illinois (69% of all households) and 2,322,217 of these 

households have mortgages (70%). By applying these percentages to the 708,035 

unemployed households in Illinois, approximately 342,000 unemployed households may 

have mortgages and be eligible for this program. 

Calculating the number of underemployed eligible households for this program is 

difficult due to lack of available data and reporting on income reduction. Mortgage 

default is the strongest measure of determining household income reduction. When 

considering the statewide mortgage default rate of 10.65% against the 2,322,210 

households carrying a mortgage, over 247,000 households may be in mortgage default. 

Given these parameters, IHDA estimates that Illinois has a range of 247,000 to 342,000 

eligible households for this program. Due to the availability of funds and the statewide 

need, IHDA has limited eligibility using income, assets, mortgage type, and mortgage 

amount to target assistance to households that will benefit from the temporary mortgage 

assistance and be likely to regain financial independence as homeowners. 

Targeted Funds to Illinois’ Hardest Hit Counties 

 

To best address the geographic diversity of the conditions of unemployment and 

foreclosure in Illinois, IHDA will target a higher funding level to eligible homeowners in 

counties faced with higher levels of economic distress. Counties in worse economic 
Illinois Housing Development Authority 12 

condition may face longer periods of recovery in the housing and job market, 

necessitating higher levels of assistance. By comparing each county’s unemployment 

rate, foreclosure rate, delinquency rate, and change in home prices against state levels, 

IHDA has identified counties experiencing particular distress. Counties exceeding the 

state average rates in any of these four categories will be eligible to receive a maximum 

of $25,000 in HHF HELP assistance. All other counties will receive a maximum of 

$20,000 in HHF HELP assistance per eligible household. The following table shows all 

counties in Illinois, identifies those which will qualify as an Illinois Hardest Hit County 

and the factor in which they qualified. A map showing the geographic distribution of 

these counties throughout the state is also attached. 

 
Illinois Housing Development Authority 13 

Adams Lee X

Alexander X Livingston 

Bond Logan 

Boone X X X X Macon X

Brown Macoupin X

Bureau X Madison 

Calhoun Marion X

Carroll X Marshall 

Cass X Mason X

Champaign Massac X X

Christian McDonough 

Clark X McHenry X

Clay X McLean 

Clinton Menard 

Coles Mercer 

Cook X X X Monroe 

Crawford Montgomery X

Cumberland Morgan 

De Witt Moultrie 

DeKalb X Ogle X

Douglas Peoria X

DuPage X Perry X

Edgar X Piatt 

Edwards Pike 

Effingham Pope X X

Fayette X Pulaski X

Ford Putnam X

Franklin X Randolph 

Fulton X Richland X

Gallatin Rock Island 

Greene Saline 

Grundy X Sangamon 

Hamilton X Schuyler 

Hancock X X Scott 

Hardin X X Shelby 

Henderson St. Clair X

Henry X Stark X

Iroquois X Stephenson X

Jackson Tazewell 

Jasper Union X

Jefferson Vermilion X

Jersey Wabash 

Jo Daviess Warren 

Johnson X Washington 

Kane X X Wayne 

Kankakee X White 

Kendall X X X Whiteside X

Knox Will X X

Lake X X Williamson 

La Salle X Winnebago X X

Lawrence Woodford

Identification of Illinois' Hardest Hit Counties

County Unemployment Foreclosure 

Filings

Delinquencies 

90 Days +

Housing 

Change County Unemployment Foreclosure Filings

Delinquencies 

90 Days +

Housing 

Change

Note: Each Illinois county was evaluated against the State average in terms of foreclosure rate in June 2010, percent change in home sale

prices from 2006-2009, 90-day delinquency rates, and unemployment rates from June 2010. Counties are identified as "hardest hit" if they

exceeded the State average in any category as shown by an "X" above.

Sources: Bureau of Labor Statistics, Federal Reserve Bank of New York, Illinois Association of Realtors.
Illinois Housing Development Authority 14 

 Illinois’ Hardest Hit Counties 

The darker shaded counties indicate those areas are “hardest hit”, relative to all other counties in Illinois. These 

indicators are used to determine ”hardest hit”: county share of state foreclosure filings in June 2010, percent change in 

valid home sale prices from 2006-2009, 90-day delinquency rates and average unemployment rates from June 2010. 

Counties were grouped into categories against the State in each indicator. 
Illinois Housing Development Authority 15 

Eligibility Criteria 

Households must meet the following criteria to be eligible for any HHF HELP assistance: 

• Present household income equal or below 120% of area median income; 

• Currently unemployed or substantially underemployed by no fault of the 

borrower(s); 

• Fee simple title ownership on the property; 

• Occupancy of the home as primary residence with no more than four units; 

• Primary residence must be the sole residence of the borrower(s); 

• Households must show a minimum of 25% reduction in income; 

• Current mortgage expense greater than 31% of present household income; 

• Evidence of timely mortgage payments prior to income reduction; 

• No more than 6 months mortgage delinquency at time of application; 

• Present housing payment (and escrow should it apply) in excess of 31% of 

monthly income; 

• Maximum total of 3 months housing payments in available liquid assets, 

excluding retirement; and 

• A present maximum mortgage amount not to exceed of $500,000. 

Homeowners with a first mortgage with a fixed-rate adjustable rate (ARM) will be 

eligible to apply for assistance. However, monthly principal and interest payments for all 

mortgages must be fixed for the possible 18-month duration of program funding. Funding 

will only be available toward first mortgages, as secondary mortgages are excluded from 

receiving program support. IHDA will review all mortgages and liens against the client’s 

property to determine eligibility. Homeowners with interest-only first mortgages and 

negative amortization first mortgages will be excluded from receiving any assistance. 

Every household must submit a hardship affidavit in order to receive HHF HELP 

assistance along with supporting documentation evidencing a verified need for mortgage 

assistance. Program participants must provide authorization to counselors and IHDA to 

access the borrower’s private information, contact the borrower’s loan servicer, and 

collect information after the conclusion of assistance. 

Each applicant will submit a Borrower Action Plan in order to be eligible for assistance 

containing an outline and description of a plan to regain meaningful employment. All 

borrowers will have to report job search progress or training progress at IHDA’s request 

throughout the program assistance term. 

Please see the HHF HELP Term Sheet attached as Exhibit A. 
Illinois Housing Development Authority 16 

Section C: Demonstration of Capacity to Implement 

Eligible Entity 

In accordance with HHF Guidelines published by the US Department of Treasury 

("Treasury"), each recipient of funding from the HHF must qualify as an "Eligible 

Entity", as defined in the Emergency Economic Stabilization Act (the "EESA"). The 

Illinois Housing Development Authority is a body politic and corporate established and 

regulated by the State of Illinois (the "State") pursuant to the Illinois Housing 

Development Act, 20 ILCS 3805/1 et. seq., as amended (the "Act"). IHDA operates 

independently of the State and has the power to receive funds from Treasury and enter 

into agreements or other transactions with any federal agency, as detailed in the Act. 

Thus, the Illinois Housing Development Authority qualifies as an “eligible entity”. 

IHDA Background 

IHDA has demonstrated experience as a lender, issuer, and program administrator for a 

wide range of housing programs including the federal Mortgage Revenue Bond (MRB), 

Low Income Housing Tax Credit (LIHTC), HOME Investment Partnership Funds, HUD 

Risk Share Mortgage Insurance Program, Section 8 Project Based Rental Assistance, and 

State programs including Illinois Affordable Housing Trust Fund (State Trust Fund), 

Illinois State Housing Tax Credit, and the Illinois Rental Housing Support Program. 

Recently, IHDA took the lead for implementation of the affordable housing programs 

authorized under the HERA and ARRA federal legislation including NSP 1, Tax Credit 

Assistance Program (TCAP), the U.S. Treasury 1602 Tax Credit Exchange Program, and 

the New Issue Bond Program. 

IHDA has successfully implemented all of the above-referenced programs in cooperation 

with both the U.S. Department of Housing and Urban Development (HUD) and the U.S. 

Treasury/Internal Revenue Department (Treasury). In addition, as more fully described 

earlier in the proposal, IHDA has been administering several foreclosure mitigation 

programs, including the National Foreclosure Mitigation Counseling Program. 

Since its inception, IHDA has invested over $10.2 billion to create 212,342 affordable 

housing units and assist home purchases for first-time homebuyers. Cumulative funding 

through IHDA’s financing programs in FY10 (ending June 30, 2010) included over $706 

million in financing commitments for 7,700 units. Funding administered by IHDA 

through federal Section 8 Project Based contract administration totaled an additional 

$125 million in FY10. In addition, the Authority is the lead agency for the State of 

Illinois for preparation and reporting under the federally mandated Consolidated Plan 

(HUD) and the State of Illinois Comprehensive Housing Plan, each of which seek to 

address the housing needs of underserved, priority populations throughout State. 

 

Over years of operating these programs, IHDA has built significant expertise to: 

• develop programs addressing community needs; 

• establish systems and procedures in conformance with governmental regulations; 
Illinois Housing Development Authority 17 

• implement effective public marketing and communications tools; 

• manage statewide and local networks of housing developers and providers; 

• create meaningful monitoring and reporting mechanisms; and 

• achieve efficient fund disbursement. 

IHDA’s Key Staff Members 

Gloria L. Materre, Executive Director, was appointed by the Authority's Board on 

September 18, 2009. Ms. Materre served as Deputy Chief of Staff under Governor Pat 

Quinn, playing an instrumental role in housing initiatives, legislative matters, economic 

and business development, and community stabilization. She has an extensive legal 

background in real estate and business transactions, as well as other professional 

experience. Ms. Materre was principal of Materre & Associates, P.C. for over 13 years. 

She holds a bachelor's degree in journalism from the University of Wisconsin-Madison, 

and a law degree from the University of Illinois College of Law. 

Phillip Culpepper, Deputy Executive Director and Chief of Staff, joined the Authority in 

October 2009. He brings extensive experience in the areas of public finance, bond fund 

accounting, strategic planning and revenue forecasting. As the Director of Debt 

Management for the State of Illinois, Mr. Culpepper oversaw more than $7 billion in 

public finance transactions. He also served with the Illinois Toll Highway Authority, 

where he structured and coordinated more than $3 billion of municipal bonds and 

derivative transactions to support construction projects for Illinois’ Congestion Relief 

Program. Mr. Culpepper served as a Non-Commissioned Officer in the U.S. Army and 

holds a bachelor’s degree in economics from Loyola University of Chicago. 

Robert W. Kugel, Chief Financial Officer, has served as Chief Financial Officer of the 

Authority since 1983. He has been with the Authority since 1975. Previously, he served 

as finance manager of Telco Marketing Services Inc. for three years and of a division of 

The Greyhound Corporation for four years. Mr. Kugel holds a Juris Doctor degree from 

John Marshall Law School, a Master of Business Administration degree from Loyola 

University of Chicago and a Bachelor of Science degree from Northern Illinois 

University. 

Mary R. Kenney, General Counsel, returned to the Authority in August 2000. She 

previously served as an administrator of the Authority’s Portfolio Administration 

Department from 1988 through 1991 and earned her law degree from Loyola University 

of Chicago. After law school, she joined the Chicago law firm of Johnson & Bell in 1994 

where she specialized in commercial litigation. Ms. Kenney has argued before various 

appellate courts and has participated in all phases of litigation at the trial court level. She 

also holds a Bachelor of Science degree in finance from DePaul University, where she 

concentrated in real estate and graduated with honors. 

Vanessa Hill, Director of Homeownership Programs, joined IHDA in 2005. Ms. Hill has 

administered or supervised the NFMC, the homeownership initiatives of the federal 

HOME program and State Housing Trust Fund programs, as well as other programs 

targeting housing counseling capacity and predatory lending. Ms. Hill has a background 
Illinois Housing Development Authority 18 

in affordable housing development and holds a Bachelor of Arts Degree in Social 

Welfare from the University of Wisconsin-Madison. 

Margaret Cullom, Managing Director Loan and Portfolio Management, joined the 

Authority in October 2007 and brings over 20 years of loan servicing and asset 

administration experience in the multifamily and single family housing industry. Since 

joining the Authority Ms. Cullom has established the Loan and Portfolio Management 

Department with an emphasis on transaction and financial management, risk 

management, and customer support for the Authority. Prior to joining the Authority she 

managed multifamily operations for the National Association of Home Builders and 

served over 14 years managing multifamily assets for Fannie Mae. 

Neil O’Callaghan, Managing Director Information Technology, has more than 23 years 

of Information Systems experience. Mr. O’Callaghan manages the IT group in its efforts 

to identify, develop and direct the implementation of the Authority’s information 

technology solutions to support the Authority’s business activities. He has a Bachelors 

Degree in Information Systems and a Masters in Business Administration. Prior to 

joining the Authority, he was a Vice President at a technology consulting firm with 

experience working with an extensive array of clients, technologies and software 

applications. 

Hazim Taib, Deputy Chief Financial Officer and Assistant Treasurer, has been with the 

Authority since 1998. His responsibilities include overseeing over $4.5 billion of total 

assets and liabilities, managing the Authority’s capital budget along with its credit risk 

and rating. He has extensive experience in bond structuring, cash modeling, tax exempt 

issuance and rating agencies requirements. Mr. Taib holds a Master of Business 

Administration degree with emphasis in statistics, a Bachelor of Science degree in 

finance from Indiana State University and a degree in Public Administration from 

Universiti Teknologi MARA, Malaysia. 

Compliance Infrastructure 

IHDA has established business processes to receive, administer, and disburse federal and 

state funds to meet program goals, in accordance with governmental requirements, and to 

minimize the risk for fraud or mismanagement of funds. The structural framework of the 

Authority provides for the separation of duties between program approval of grants and 

loans, and the staff or departments responsible for disbursement of funds, playing a vital 

role in the overall compliance infrastructure of all administered programs. The 

departments described below will be integral in the disbursement and tracking of HHF 

HELP funds. 

The Homeownership Department will house HHF HELP at IHDA. This department 

currently operates all first mortgage products, down payment assistance, owner-occupied 

rehabilitation, home modification and foreclosure mitigation programs for the agency. 

IHDA’s Home Start first time homebuyer first mortgage program currently offers an 

FHA product through a network of community lenders. Most of the federal HOME and 

State Trust Fund activities such as down payment assistance, rehabilitation and 
Illinois Housing Development Authority 19 

foreclosure mitigation counseling are implemented in partnership with not-for-profit and 

local government partners, including housing counseling agencies. IHDA will rely on 

these partnerships in order to facilitate the statewide launch of program. IHDA 

anticipates dedicating 24 staff persons to HHF HELP. This staff will be responsible for 

the day- to- day operations of the program, providing phone counseling, ensuring 

compliance with the program requirements, and reporting to Treasury. 

The Loan and Portfolio Management Department services and manages the IHDA 

multifamily rental and single family portfolio of loans using both internal Authority staff 

and external contracted servicers. As of June 30, 2010, IHDA’s loan portfolio included 

11,400 loans totaling $2.1 billion. The greatest number of loans in the IHDA portfolio 

include 9,000 Homeowner Mortgage Revenue Bond-financed residential mortgages. The 

multifamily rental housing portfolio includes over $1.4 billion in mortgage loans financed 

through taxable and tax exempt resources, HOME or State Trust Fund resources. IHDA 

operates numerous home purchase and rehabilitation programs with HOME and State 

Trust Fund and has over 1,500 loans in this segment of the portfolio, all of which are 

serviced in-house by IHDA staff. 

Over the past several years IHDA has launched several re-engineering initiatives that 

have enabled IHDA to maximize the effectiveness and efficiency of its core financial 

processes and enhance loan servicing operations. IHDA has implemented to following 

improvements: 

• IHDA’s loan servicing system was enhanced with expanded technical 

functionality to track and monitor loan and property level data for multifamily 

assets; 

• Electronic scanning of all multifamily and single family loan documents; 

• Conversion to a new custom developed software application to service single 

family residential mortgages; 

• Consolidation of single family loan servicing activities to one single sub-servicer; 

• Enhanced linkages between servicing software applications and programs; 

• Automated HUD Section 8 and 236 payment processing.

The Finance and Accounting Departments manage all financial operations within the 

Authority. The Finance Department is responsible for transfer of funds and disbursement 

of fund requests based on approvals received by the program managers and senior 

Authority staff. This department is responsible for the Authority’s cash and investment 

position, bond trust activity and debt liability management. 

The Accounting Department is responsible for accurate and timely accounting and 

reporting of all grant, loan and bond transactions, maintenance of the financial books and 

records of the Authority, issuance of timely financial reports, management of the 

electronic time tracking system and cost allocation plan, and ensuring adequate control of 

assets. The department reviews accounts payable requests, processes timely vendor 

payments, manages the Authority payroll, and processes all fees and payments. In 
Illinois Housing Development Authority 20 

addition, the department ensures adherence to generally accepted accounting principles in 

all financial and reporting transactions. 

The Legal Department serves as internal counsel for all Authority business including: 

financing and bond issuance; negotiation and documentation of loans, grants, and 

contracts; consultation and interpretation of legislative and regulatory matters; and 

oversight of all legal aspects of the Authority administration. 

IHDA operations benefit from guidance and recommendations provided through a 

defined internal audit format. The Internal Audit Department (IA) is responsible for 

reviewing internal controls for operations and programs by conducting periodic audits 

based on an annual risk assessment plan, assisting in implementing proper internal 

controls of new systems, and recommending changes to identify and improve current 

internal controls in each of the IHDA’s business systems. The Director of Internal Audit 

reports to the Audit Committee of the IHDA Board of Directors. The internal audit 

function at IHDA operates in conformance with State Fiscal Control and Internal Audit 

Act (30 ILCS/10) and the Institute for Internal Auditors Standards for Professional 

Practices of Internal Auditing. 

The Authority’s Information Technology Department supports the Authority’s 

computer systems and technology requirements. The IT staff support a help desk, user 

desktop and application software, system backup and recovery, database management, 

system security, custom software development, and new technology and application 

requirements. Many of the IT staff have numerous years of experience with Housing 

Finance Agency systems, including significant experience working with mortgage loan 

origination and loan servicing applications. This department manages all electronic 

protection systems for the Authority. The Information Technology department has a 

current disaster recovery plan with offsite recovery ability. 

IHDA intends to utilize the existing department infrastructure and build on currently 

existing policies and procedures wherever possible in the operation and compliance of 

HHF HELP. 

Audit and Internal Controls 

IHDA will comply with all requirements under EESA and will carry out the following 

steps for the program: 

• Evaluate policies, procedures and internal controls for compliance with all 

program requirements; 

• Test processes before full program launch by administering a pilot program 

utilizing IHDA’s existing first mortgage portfolio;

• Prepare a readiness assessment and confirm that program process and controls 

functioned correctly during the pilot phase; 

• Evaluate program process for compliance with applicable OMB Circulars, 

adequate internal controls and sufficient fraud risk mitigation. 
Illinois Housing Development Authority 21 

IHDA complies with audit, administrative, and cost requirements and principles outlined 

under federal guidelines OMB A-133, OMB A-87 and OMB A-102. IHDA activities 

comply with multiple federal and state compliance criteria from HUD and other funding 

entities. 

IHDA’s Internal Audit Department performs an annual certification of internal controls. 

This review examines existing controls for all Authority programs and makes 

recommendations for improvement. As a new IHDA program, HHF HELP will undergo 

certification of internal controls in the first year and each year of operation. Controls are 

assessed in accordance with the criteria determined by the Committee of Sponsoring 

Organizations (COSO). An annual financial and compliance audit of IHDA programs 

and financial statements is conducted by an independent audit firm, contracted through 

the Illinois Office of the Auditor General. 

 

IHDA will employ client management, loan servicing, and general ledger systems to 

manage information flow through each stage of the HHF HELP process and between 

implementation partners. IHDA will verify information through review and comparison 

of source documentation and reconciliation of financial accounts. Transactions into and 

out of the HHF accounts will be recorded to the general ledger, reconciled monthly to the 

data contained in the loan servicing system. The Accounting Department will then 

reconcile the HHF fund records in the general ledger against monthly bank statements. 

Fraud Risk Mitigation 

IHDA will seek to combat the risk of fraud within HHF HELP both at the funding level 

with IHDA and its business partners, and with applicants to the program. IHDA will 

review the program for internal control prevention and detect weaknesses that could 

result in fraud. IHDA will continually make process improvements and add controls as 

necessary throughout the program to safeguard the funds, and verify all submittals from 

partner housing counseling agencies to make the final eligibility determination and 

funding approvals. Borrowers will be required to attest that all information submitted is 

accurate and to provide any additional documentation requested by IHDA. 

IHDA will also work cooperatively with IDES to assist in the evaluation of requests for 

assistance. As allowable by federal and state rules, IHDA will utilize the information 

currently collected regarding claims of unemployment insurance to review HHF HELP 

participants for possible instances of fraud. 

As required by Treasury, IHDA will develop an Internal Antifraud and Compliance 

Monitoring Program within 90 days of the effective date of the HFA Participation 

Agreement. 

Reporting Protocols 

IHDA will comply with all tracking and reporting standards required by Treasury for the 

HHF resources. The client management, loan servicing, and general ledger systems will 

track a wide range of program and financial information including beneficiary 
Illinois Housing Development Authority 22 

demographics, property information, mortgage terms, and accounting of all payments 

into and out of the HHF HELP fund. IHDA will make financial reporting, including all 

programmatic and administrative expenditures available on a monthly, quarterly, and 

annual basis. IHDA will also reconcile variances between projected and actual budget 

amounts. 

IHDA will compile programmatic and demographic information on a quarterly basis, or 

as required by federal guidelines. IHDA will develop additional reporting for the HHF 

HELP to assess programmatic goals including: successfully retained homeownership; 

homeowner assumption of full mortgage payments; homeowner delinquencies; other 

outcomes such as home sale or short sale, foreclosures or deed in lieu. As with financial 

performance, IHDA will identify and review variances between projected program 

outcomes and actual outcomes. IHDA will add at least four compliance personnel 

officers responsible for reporting and tracking HHF HELP. 

Systems Infrastructure 

The foundation for the system infrastructure will rely on adaptation of existing 

technology systems, procurement of a new client management system, and procedures 

currently in place at IHDA. The client management system to be procured will provide 

an on-line system to facilitate borrower intakes, referrals and submissions by counselors, 

and review of eligibility by IHDA staff. It will effectively manage the flow of borrower 

information between all program partners. Any system acquired will be capable of 

interacting with IHDA’s current servicing and accounting systems. All systems put in 

place for the program will comply with EESA. IHDA will verify information through 

review and comparison of source documentation and reconciliation of financial accounts. 

Funding Implementation Mechanisms 

IHDA will create separate fund accounts for HHF HELP fund disbursements, 

repayments, and administrative expenses. Only eligible activities and related 

administrative expenses will be paid using HHF funds. HHF HELP funds will be held in 

a Treasury designated account and tracked for each individual loan. Funding draws will 

be requested on a scheduled basis for all newly approved HHF loans. 

IHDA will create a separate division within the loan servicing system to account for all 

loan transactions administered under HHF HELP. The system will designate individual 

loan criteria including monthly and maximum dollar allocations and maximum terms of 

assistance to control funding outlays. IHDA will create a loan record for all payments 

into and out of the HHF designated account. The servicing system will immediately 

transmit payment data to the Authority’s general ledger. 

The Authority’s Loan and Portfolio Management and Finance Departments will 

coordinate payments to servicers via ACH wire transfers on a monthly basis. The 

Authority will make full mortgage payments to servicers. The loan servicing system will 

produce monthly payment statements for all participating loans. 
Illinois Housing Development Authority 23 

Section D: Staffing and Business Partners 

The staffing plan detailed below describes IHDA’s best estimate of the staffing 

requirements necessary for the program implementation of HHF HELP. As the 

operational implications of the program are still being assessed, additional staff or 

changes in staff deployment may be necessary. The staffing grid below describes both 

deployment of existing staff and adding new staff while the organizational chart details 

the HHF HELP dedicated staff. 

Role Role Description Number of Staff

Director, Homeownership 

Programs

Oversee the HHF Program ("Program") 

operations and responsible for Program 

delivery

Part-time throughout life of Program

Assistant Director of 

Homeownership Programs for 

HHF

Responsible for daily operations of the 

Program and management of any outside 

Program vendors (if applicable)

1 full-time throughout life of Program

HHF Program Administrative 

Support

Provides administrative and clerical support 

to Program

1 full-time throughout life of Program

HHF Program Process 

Supervisor

Responsible for managing of Processing and 

Housing Counseling staff, responsible for 

intake and processing, training of counselors

1 full-time throughout life of Program

HFF Housing Counseling Staff In-house counselors to augment intake and 

triage 

5 full-time throughout life of Program

HHF Intake Specialist Responsible for reviewing applications 

submitted by housing counselors processing 

of Program Applications, producing loan 

documents, arranging closing, requesting 

loan set up with Portfolio

7 full-time throughout life of Program
Illinois Housing Development Authority 24 

Role Role Description Number of Staff

HHF Program Customer Service 

Supervisor

Responsible for managing of Customer 

Service Staff, hotline and web portal

1 full-time throughout life of Program

HHF Program Customer Service 

Staff

Responsible for answering homeowner 

communications and providing overall 

customer service for the Program

4 full-time throughout life of Program

HHF Program Compliance 

Supervisor

Responsible for Program reporting to US 

Treasury and ensuring compliance with all 

applicable guidelines and requirements of the 

program

1 full-time throughout life of Program

HHF Compliance Analyst Manage reports to Treasury, ongoing 

recertifications of unemployment once client 

is assisted, outcome follow up 

3 full-time throughout life of Program

Managing Director, Loan & 

Portfolio

Oversee set up of homeowner loans, 

payments to servicers and collecting 

borrower payments 

Part time throughout life of the Program

Loan and Portfolio Staff Responsible for establishing loans in 

servicing software, effectuating payments to 

servicers, tracking and reconciling borrower 

payments

1.5 full-time

Managing Director, Information 

Technology

Oversee the support of technology 

components that enable the Program

Part time during start -up, nominal effort 

throughout Program life

IT Staff Maintain and support the technology 

components of the program as well as general 

IT support

Part-time throughout life of Program

General Counsel Provides oversight to all legal issues and 

resolutions related to the Program

Part time during start up and nominal 

effort throughout Program life

Legal Staff Assist in the initial development of program 

legal documents and other forms, assist with 

legal issues as they arise

Part-time throughout life of Program

Controller Responsible for proper accounting of 

program funds and responses to audit 

requests

Part-time during start up and nominal 

effort throughout Program life

Accounting Staff Responsible for ensuring proper accounting 

of Program funds

2 full-time
Illinois Housing Development Authority 25 

Role Role Description Number of Staff

Chief Internal Auditor Oversee risk management and control for the 

Program

Part-time during start up and nominal 

effort throughout program life

Internal Audit Staff Responsible for risk management and control 

for the Program

Part-time throughout life of program

Director, Marketing & 

Communications

Oversee communication and outreach for the 

Program

Part-time during start up and nominal 

effort throughout Program life

Marketing & Communications 

Staff - Communications & 

Outreach

Responsible for development and delivery of 

communication materials and outreach to 

potential eligible homeowners.

Part-time throughout life of Program

Marketing & Communications 

Staff - Web Site

Responsible for the delivery of outreach and 

communication materials via the IHDA 

website and other partner sites

Part-time throughout life of Program

Chief Financial Officer Oversee the draws and financial analysis of 

Program funds

Nominal effort throughout Program life

Finance Staff Conduct detailed financial analysis of

Program funds

Part-time throughout Program

Outside Counsel Supports legal staff on legal issues and 

resolutions associated with the Program

1 full-time for funds allocation period; 

part-time during reporting and compliance

Outside Audit Firm Provides Program with annual independent 

financial audit and assessment and assistance 

in pre-launch readiness assessment

Part-time throughout Program

Client Management System 

Vendor

Provides web-based client management 

system with required maintenance

Part-time throughout Program

Call Center Provides information and initial screening to 

HHF HELP interested applicants

Full-time throughout Program

Title Agency(ies) Provides closing services and property 

information for borrower loans

Part-time throughout Program

HHF Program Counseling 

Vendor - possible if necessary

Provides selection, training and oversight of 

counseling agencies participating in the 

Program

Full-time throughout funds allocation

Business Partners
Illinois Housing Development Authority 26 
Illinois Housing Development Authority 27 

Partnerships with housing counseling agencies, community action agencies and other 

local service organizations will play a key role in implementing HHF HELP. IHDA 

expects housing counseling agencies will serve as one of the multiple points-of-contact 

for eligible borrowers before they begin the intake process for the program. Agencies will 

perform the initial eligibility screen for the program, collect all supporting documentation 

and provide IHDA will a fully documented file with which to confirm eligibility status 

and determine an assistance amount. 

Utilizing the agencies for this purpose will build on their expertise in existing 

modification programs and supporting documentation. IHDA will use the counselor’s 

existing knowledge and experience to handle the high demand for the program. In return 

for performing this service, the agency will be paid approximately $600 per loan closed. 

IHDA will work with community action agencies and other HUD-certified counseling 

agencies to extend coverage to counties where no NFMC participating housing 

counseling agency exists. 

Additionally, IHDA will enlist help from the Illinois Department of Employment 

Security to provide IHDA with reports of unemployed borrowers throughout the program 

for compliance and reporting purposes. 

HHF HELP will also require the services of title agents within Illinois to provide accurate 

property legal descriptions and record mortgages with the appropriate local governmental 

office. IHDA expects these services will cost approximately $400 to $600 per file. 

Section E: Administrative Expense 

IHDA anticipates using approximately 16.09% of the $166 million award for allowable 

administrative expenses. Approximately 25% will be used to compensate housing 

counseling agencies. Please see Exhibit B for the required Administrative Budget. 

Expenditure Timeline 

The schedule below describes IHDA’s expectation that the original program funds will be 

drawn down over a four year period. IHDA expects the majority of applications to be 

submitted in Year One and Year Two with expenses reduced over Year Three and Year 

Four. 

Implementation Year One Year Two Year Three Year Four 

$1,851,815 $65,800,364 $49,350,273 $32,900,182 $16,450,092 

IHDA will make an initial draw of 20% of available HHF Funds upon Treasury approval. 

IHDA will request funds as needed throughout the program but anticipates draws on a 

quarterly basis. 
Illinois Housing Development Authority 28 

Section F: Risk Management 

IHDA will manage risks to the program through a combination of internal controls, 

reviewing all submittals by business partners and ongoing compliance monitoring. IHDA 

will create an Internal Antifraud and Compliance Monitoring System for HHF HELP 

within 90 days of Treasury approval of the program.

Policies, procedures and internal controls required to implement HHF HELP will be 

modeled on processes already in place and operating at IHDA. All departments within 

the Authority maintain procedure manuals for implementation of programs and 

processes. HHF HELP processes and systems will incorporate validation of information 

and checks and balances to assure participant eligibility, program compliance with 

regulations, and financial soundness. IHDA staff will develop a detailed procedure 

manual for the program that identify program-specific activities and incorporate 

established processes and systems. IHDA will design a training module on program 

requirements and procedures for all IHDA staff and outside business partners working on 

HHF HELP. 

IHDA will also manage fraud risk by reviewing each file submitted by our intake partners 

to confirm eligibility, and will make the final determination of eligibility and establish the 

amount of assistance available to the household. IHDA has formed a partnership with 

IDES to check program participants against the currently available sources of information 

on unemployed and newly hired persons, as allowable by the regulations regarding those 

sources of information. 

All new IHDA programs are required to undergo a risk assessment and internal audit. An 

audit will occur annually of HHF HELP as part of IHDA’s financial and compliance 

audit conducted by an independent audit firm. In addition, the Internal Audit Department 

at IHDA will incorporate an assessment and review of the program into the annual 

internal audit plan utilizing an Enterprise Risk Management program. Areas of focus 

include review of processes and internal controls to assess: reporting and accountability 

of staff and managers throughout the process; adequate financial management and 

reporting; and weaknesses or susceptibility to fraud. The assessment is required to 

include a thorough evaluation of fraud risks in accordance with Illinois Statute and to 

increase awareness of high risk areas for staff. 

In addition, IHDA will add HHF HELP to the annual control certification review 

undertaken by the Internal Audit Department in conformance with COSO criteria. The 

control assessment examines internal environmental risks such as organization structure, 

assignment of authority and responsibility, and human resource standards. Control 

activities such as reconciliations, safeguarding of assets and process flow controls are 

also evaluated. 

IHDA will continually review the program for internal control and detect weaknesses that 

could result in fraud. The results of the independent review and audit of the pilot phase 

will contribute to adjustment and refinement of the procedures for full roll-out of the 
Illinois Housing Development Authority 29 

program. IHDA will make process improvements and add controls as necessary to 

safeguard the funds.