The Keep My Tennessee Home program, which is funded through the Hardest Hit Fund, provides payment assistance for homeowners who have fallen behind on their mortgage and are facing the possibility of foreclosure. Keep reading to get an overview of the program, learn how much assistance is available, and find out if you are eligible.
Hardest Hit Fund
In 2010, the U.S. Department of the Treasury created the Hardest Hit Fund to provide targeted aid to homeowners in those states most affected by the housing market crash. As part of this program, $7.6 billion in aid was allocated to the 18 states, along with Washington, D.C., that experienced the most extreme home price declines and high unemployment rates as a result of the economic crisis.
(Learn more about the Hardest Hit Fund.)
Tennessee was awarded over $217 million in funds through the Hardest Hit Fund to offer mortgage assistance to homeowners so they can avoid foreclosure. (Learn more about the Tennessee foreclosure process.) To do this, Tennessee set up the Keep My Tennessee Home program.
Keep My Tennessee Home
The Keep My Tennessee Home program provides short-term assistance by making monthly mortgage payments on behalf of Tennessee homeowners who have fallen behind due to reasons that are no fault of their own (such as unemployment or underemployment). The program offers up to $40,000 over 36 months.
If you find a new job during the benefits period, you can still receive assistance for up to two additional months after reemployment. Additionally, you are eligible to receive continued assistance if you become reemployed, but your mortgage payment exceeds 31% of your current income.
How the Program Works
Assistance is provided in the form of a non-recourse, forgivable loan secured by a junior lien that is recorded against the property. The debt is reduced by 20% per year for every year you stay in the home after receiving assistance. At the end of five years, the debt is considered satisfied and the lien will be released.
You only need to repay the loan if you do one of the following things during the five-year forgiveness period.
- You move out.
- You sell the property and there are sufficient equity proceeds available.
- You refinance and take cash out.
To be eligible for assistance from the Keep My Tennessee Home program, you must meet all of the below criteria.
- You are a legal resident of the United States and live in Tennessee.
- You are unemployed, underemployed (with at least a 30% reduction in pay), have been divorced, lost a spouse, experienced a major medical expense, or been awarded long-term disability since January 1, 2008.
- Your hardship was due to no fault of your own.
- You occupy the property as your primary residence.
- Your household income is less than $92,680.
Home Eligibility Criteria
Additionally, your existing mortgage and the property securing the mortgage must meet the below criteria.
- The property is in Tennessee.
- The property is a single-family home or condominium.
- The total unpaid principal balance on your mortgage is no more than $275,000.
Manufactured or mobile homes are eligible if legally classified as real property, meaning the home is permanently affixed to a foundation and is located on real estate owned by the applicant. Learn more about what happens if you are struggling to pay your mobile home loan.
You are not eligible for the Keep My Tennessee Home program if one of the below conditions applies to you.
- You have more than six months of mortgage principal, interest, taxes, and insurance in reserves.
- You have been convicted of felony larceny, theft, fraud or forgery, money laundering, or tax evasion in connection with a mortgage or real estate transaction within the last ten years.
How to Apply
Go to www.keepmytnhome.org and click on “Get Started! Apply Here” and then go to “click here to get started” at the bottom of the page to begin the application process and complete the pre-screening questions. (You can also go directly to https://keepmytnhomeportal.org.)
As part of the application process, you will be connected with an approved counseling agency to help you obtain the documents needed to file for assistance, as well as develop an individualized plan to address your particular situation. If you do not qualify for assistance under the Keep My Tennessee Home program, you can speak to your housing counselor about other options to avoid foreclosure.
(If you want to speak to a housing counselor before applying for assistance under the program, go towww.keepmytnhome.org and click on the “Counselor List” button to find a counselor in your area.)
Beware of Scams
The Keep My Tennessee Home program is free of charge and you should not pay for any services associated with applying for assistance. Do not pay any company that promises to expedite your application or guarantees approval.
If anyone asks you to pay a fee to apply for the program, report this immediately to your local counseling agency and/or the Tennessee Housing Development Agency (THDA) at 800-228-THDA. (Go to www.thda.org for more information about the THDA, which is the administrator of the Keep My Tennessee Home program.)
For More Information
If you would like more information about the Keep My Tennessee Home program or have questions about how to apply for assistance, you can:Government Foreclosure Prevention Programs topic area.