foreclosure - HEMAP - circumstances - self-employment - business expenses
Meider v. PHFA - Cmwlth. Court - July 23, 2010 - unreported memorandum decision
The court upheld PHFA's decision to exclude homeowner's business expenses from sole proprietorship from financial calculations, relying on Valentine v. PHFA, 511 A.2d 915 (Pa. Cmwlth. 1986) and Horton v. PHFA, 511 A.2d 917 (Pa. Cmwlth. 1986), where it held that "it was a voluntary choice for homeowners to divert payments on the home property to fund business enterprises. These voluntary choices precluded a finding that each applicant’s financial hardship was due to circumstances beyond the applicant’s control. Similarly, in this case, Petitioner expended funds toward a business enterprise, which depleted the funds available to pay the mortgage."
The court found the cases "similar to Cullins v. PHFA, 623 A.2d 951 (Pa. Cmwlth. 1993)....As in Cullins, we are not persuaded that the state of the economy caused Petitioner’s inability to find work. While Petitioner’s desire to maintain his long-standing business is laudable, the record is clear the business ceased being a source of income several years ago. In Cullins¸ husband applicant engaged in his business for only one year before trying to mitigate his economic difficulties by abandoning the business. In this case, Petitioner did not mitigate his economic difficulties, but exacerbated them by failing to accept the economic reality concerning his business. As in Cullins, we defer to the Agency, and we discern no error in the Agency’s determination that Petitioner’s choice in funding his business precluded a determination that his economic difficulties were caused by circumstances outside his control. Concomitantly, we discern no error in the Agency’s decision to not include in its calculations funds Petitioner expended toward the maintenance of his business.