$168M Available to Tennessee Homeowners Facing Foreclosure

Learn about Tennessee’s COVID mortgage-relief program.

By , Attorney · University of Denver Sturm College of Law

Update: As of August 6, 2023, the TNHAF program for reinstatement discussed in the article below is closed to new applications. However, applications are being accepted for partial claim reimbursement. If you completed an FHA or VA partial claim to resolve a mortgage delinquency due to COVID-19, you can apply for reimbursement.

In early 2021, President Joe Biden signed the American Rescue Plan Act into law. This law created a Homeowner Assistance Fund, a federal program, to give $10 billion to the states to help households that are behind on their mortgages and other housing-related expenses due to COVID-19.

Eligible homeowners in Tennessee who've experienced a financial hardship because of COVID-19 can get some of the $168 million allocated to the state—up to $40,000 per household—from the Tennessee Homeowner Assistance Fund (TNHAF) program. This program uses federal money to help homeowners in Tennessee make mortgage payments so they can avoid foreclosure, as well as pay other housing-related expenses like delinquent property taxes, homeowners' association fees, and insurance.

Available Financial Help for Tennessee Homeowners

The TNHAF program offers three kinds of assistance to eligible homeowners:

  • Reinstatement. Homeowners who've recovered from a COVID-related hardship and can afford their monthly mortgage payments in the future, but need assistance with an overdue balance, can get funding to reinstate a delinquent mortgage.
  • Reinstatement plus payments. Homeowners still experiencing a reduction of income can get money to pay upcoming monthly payments for a limited amount of time.
  • Reinstatement plus loss mitigation. Homeowners who've experienced a long-term reduction in income can get money to reinstate the loan and work out a loss mitigation option to get a more affordable monthly payment, like getting a reduction in the loan's principal balance to make the payments lower.

You need to specify what kind of assistance you need during the application process. After your application is approved, the underwriter will determine the type of assistance for which you qualify. If you qualify, the money can be applied to:

  • mortgage payments
  • homeowners' insurance and flood insurance
  • overdue homeowners' and condo association fees and dues to prevent an association foreclosure, and
  • past-due property taxes to prevent a tax foreclosure.

Eligibility Requirements for the TNHAF Program

To qualify for relief from this program, you must have suffered a financial hardship (a material reduction in income or an increase in living expenses) after January 21, 2020, because of COVID-19. You must also currently own and occupy the property as your primary residence, and your annual household income must be less than $119,850.00.

In addition, you'll probably have to meet some other guidelines.

How the TNHAF Program Works

Assistance is structured as a forgivable grant that you don't have to repay. TNHAF payments go directly to the loan servicer or other approved entity, not to homeowners.

Once your application is approved, you'll need to take a homeowner education course, which explains various options for loss mitigation and budgeting, among other things, that might help you determine what option is best for your specific situation.

How to Apply for the TNHAF Program

To apply for help from this program, go to the Tennessee Homeowner Assistance Fund program website and click on the designated button to access the application portal. You'll have to provide some documentation with your application, like mortgage statements, proof of income (such as pay stubs or tax returns), and a government-issued ID (like a driver's license).

If your application is denied, you may appeal the decision within 30 days.

How Long Will Tennessee's COVID Mortgage-Relief Program Last?

The program will continue until the earlier of September 30, 2026, or when all of the funds allotted to the program have been exhausted. If you think you might qualify, it's best to apply as soon as possible.

Avoid Homeowner Assistance Fund Scams

If you get an unsolicited offer by phone, in the U.S. mail, through email, or by text message offering mortgage relief or foreclosure rescue services, be wary. Scammers sometimes target homeowners who've been affected by COVID-19.

The TNHAF program is free. If anyone asks you to pay a fee to get housing counseling or foreclosure prevention services from this program, it's a scam.

Learn More

Call 855-890-8073 or go to the TNHAF website if you need more information.

If you need help with your application, contact a HUD-approved housing counselor who will assist you at no cost. To find a counselor near you, go to HUD's website or call 800-569-4287.