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HAMILTON — Thanks to a $1 million state grant, Neighborhood Housing Services of Hamilton has new tools to help those in Butler and Warren counties facing foreclosure.

The grant has been used to create the Ohio Home Rescue Fund, Neighborhood Housing Services Executive Director Lorie Batdorf said. Through the fund, homeowners in danger of foreclosure could be loaned as much as to $3,000.

In order to be eligible for the 36-month forgivable loans, homeowners must have a household income at or below 65 percent of the area median income. The 65 percent cutoff for both counties is $29,413 for individuals and $42,006 for families of four.

It's also important for the loan recipients to be able to make their future mortgage payments, Batdorf said. Those who qualify for the loans must attend foreclosure prevention and budget counseling to stay out of trouble in the future.

"What we're looking for is, if they're given this emergency fund, are they going to be back in this same situation in six months," she said.

The loan recipients are only obligated to pay the money back if they sell their homes, or if they fall into poor financial habits, Batdorf said.

The fund is one of a number of foreclosure-prevention programs offered by Neighborhood Housing Services as part of the nationwide NeighborWorks Center for Foreclosure Solutions. As of June 30, Ohio led the nation in foreclosure rates, according to the Mortgage Bankers Association.

Through Wednesday, there were 1,058 sheriff's sales of foreclosed properties in Butler County compared to 1,255 sales for all of 2005, Deputy Tom Wilson reported.

Though Neighborhood Housing Services is emphasizing the Home Rescue Fund, the $1 million grant also includes funding to purchase and rehabilitate foreclosed properties for resale and money to help clients restructure debt.

For more information about the programs, or to find out if your family meets the income requirements, call Neighborhood Housing Services at (513) 737-9301.

Contact this reporter at (513) 820-2025 or cdumond@coxohio.com.