$258M Available to Virginia Homeowners Facing Foreclosure

The Virginia Mortgage Relief Program provides financial assistance to homeowners experiencing financial hardships due to the COVID-19 pandemic.

By , Attorney

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

With its funding, Virginia set up the Virginia Mortgage Relief Program to provide financial assistance to prevent mortgage delinquencies, defaults, and foreclosures for those experiencing financial hardships because of the pandemic. Eligible homeowners in Virginia can apply for some of the $258 million the state received. The money can be used to pay overdue mortgage payments, homeowners' insurance, flood insurance, mortgage insurance, homeowners' association fees, and property taxes.

How the Virginia Mortgage Relief Program Works

Under the Virginia Mortgage Relief Program, you can apply for money to pay the following home-related expenses:

  • mortgage payments for first and subordinate mortgages, including down payment assistance loans provided by nonprofit or government entities
  • mortgage reinstatement or other housing-related costs related to a period of forbearance, delinquency, or default
  • homeowners' insurance, flood insurance, and mortgage insurance
  • homeowners' association fees or liens, condominium owners' association fees, special assessments, or common charges
  • delinquent property taxes to prevent tax foreclosures, and
  • personal property taxes and, in some cases, lot rental fees on unaffixed mobile homes. (You can't get money for lot rent under this program, but you might be eligible under the Virginia Rent Relief Program.)

Funds from the Virginia Mortgage Relief Program will be distributed directly to your mortgage lender or servicer, contract for deed holder, county treasurer or local taxing authority, property insurance company, or homeowners' or condominium owners' association. Assistance is structured as a non-recourse grant that you don't have to repay.

Assistance is limited to a maximum of the lesser of 20 months of eligible housing expenses or $30,000 per household. If you're getting other federal, state, or local housing assistance for the same expenses, you can't get assistance from this program.

Eligibility Requirements for the Virginia Mortgage Relief Program

You must have a financial hardship to qualify for financial assistance through the Virginia Mortgage Relief Program. That is, you must have suffered a material reduction in income or material increase in living expenses because of the coronavirus pandemic, which created or increased your risk of mortgage delinquency, mortgage default, or foreclosure, occurring on or after January 21, 2020. For example, eligible hardships include:

  • an increase in living expenses or childcare costs
  • a change in household size, or
  • a job loss or reduction in income.

Other eligibility requirements include the following.

  • You must be an eligible applicant type (that is, a natural person, not a partnership or LLC, although some trusts might also be eligible).
  • Your home must be an eligible property type (like a single-family single unit attached or detached home, condominium unit, cooperative, mobile, or manufactured home), owned and occupied as your primary residence, and located in Virginia.
  • Your household income can't exceed maximum income restrictions. The program prioritizes homeowners with household incomes at or below 100% of the applicable area median income (AMI), or national median income, whichever is greater, and socially disadvantaged individuals, as defined by Treasury, with household incomes equal to or less than 150% of the AMI or 100% of the national median income, whichever is greater.
  • The housing expense you're seeking assistance for must have become due on or after January 21, 2020.
  • If you're seeking mortgage payment assistance, the original principal balance of the loan must have been less than the Fannie Mae/Freddie Mac conforming loan limits at the time of origination. Also, the mortgage must be an eligible mortgage type, like a federally backed, conventional, private, or reverse mortgage. A loan secured by a manufactured home or a contract for deed (also known as a "land contract") qualifies.
  • If you're not seeking mortgage assistance, the current assessed value of the land and dwelling must be less than the current conforming loan limit.
  • If you previously filed for bankruptcy, you have to provide proof of a court-ordered discharge or dismissal. If you're in an active Chapter 13 bankruptcy, you must provide proof of the bankruptcy court's approval to participate in the program.

How to Apply for the Virginia Mortgage Relief Program

Registering on the program's official website is the first step in the process of getting assistance. You'll need to provide some documentation with your application, like a state-issued driver's license or identification card, a mortgage statement, and income statements (such as pay stubs). Go here to get a complete list of the documents you'll need.

How Long Will the Virginia Mortgage Relief Program Last?

The Virginia Mortgage Relief Program will continue until the earlier of September 30, 2026, or when all of the funds allotted to the program have been exhausted. To learn more, visit the Virginia Mortgage Relief Program's FAQ website.

Getting Help

If you need help with the application process, contact the Virginia Mortgage Relief Program Customer Center at 833-OUR-VMRP (833-687-8677), Monday through Friday, from 8:00 a.m. to 8:00 p.m. (EST/EDT). A representative can help you complete an application online or over the phone. You can also get in-person help by calling this number to schedule an appointment at a VMRP Assistance Center. VMRP has offices in Arlington, Richmond, Wytheville, and Newport News and takes appointments from 8:00 a.m. to 4:30 p.m.

You may also contact a HUD-approved housing counselor, who will help you for free. To find a counselor near you, go to HUD's website or call 800-569-4287. You can also find a counselor by:

  • calling the HOPE Hotline, open 24 hours a day, seven days a week, at 888-995-HOPE (4673)
  • going to the Consumer Financial Protection Bureau (CFPB) "Find a housing counselor" website
  • searching HUD's Office of Housing Counseling web page using either a map or by entering your zip code, or
  • in some areas, using HUD's iPhone app, called "HUD Counselor Locator," available for free at Apple's App Store.

If you have questions about the foreclosure process in Virginia or want to learn about potential defenses to a foreclosure, consider talking to a foreclosure lawyer.

Effective date: January 3, 2022