If you are unemployed and owe more on your mortgage than your home is worth, depending on where you live, your state may cover your mortgage.

Florida, Michigan, California and Arizona are all planning to use $1.4 billion in funds from the Obama administration to help the unemployed and underwater avoid foreclosure by giving them free money to pay their loans.

This proposed radical solution is intended for a small percentage of the unemployed and underwater homeowners in need of help, providing assistance to some of those who presently don't qualify for traditional loan modifications.

While it may rub some Americans the wrong way, Alan White, a law professor at Valparaiso University, said all homeowners will suffer if neighboring properties fall into foreclosure. Paul Willen, senior economist at the Federal Reserve Bank of Boston, adds that covering homeowners' mortgages is a better use of government funds than giving incentives to the servicers and relying on them to assist borrowers, which allows states more control over who benefits from the initiatives.

Read more on CNNMoney.com.

Posted in Education And Training, Buyer Resources

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