$387M in Mortgage Relief Available to Illinois Homeowners

Eligible homeowners in Illinois can get up to $30,000 to pay mortgage expenses and other housing costs.

By , Attorney

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 around $10 billion to the states to help households that are behind on their mortgages and other housing expenses due to COVID-19.

Eligible homeowners in Illinois who've experienced a financial hardship because of the pandemic can get a portion of the approximately $387 million allocated to the state—up to $30,000 per household—by applying to the Illinois Homeowner Assistance Fund (ILHAF) program. This program uses federal money to help homeowners cover mortgage payments and pay other home-related costs, like delinquent property taxes, homeowners' insurance, and homeowners' association fees.

What Costs Will ILHAF Assistance Cover?

You can use money from the ILHAF program to pay:

  • overdue mortgage payments (and up to three months of prospective mortgage payments in some cases)
  • loan reinstatement or other housing-related costs related to a period of forbearance due to COVID-19
  • past-due property taxes (even if you don't have a mortgage on your home but you're behind on property taxes, you may apply for assistance to prevent a foreclosure)
  • delinquent homeowners' insurance and flood insurance
  • overdue homeowners' association, condominium association, or co-op association fees, and
  • past-due mobile home lot rent.

Eligibility Requirements for the ILHAF Program

To qualify for relief from this program, you must have experienced a COVID-related financial hardship that began, continued, or worsened after January 21, 2020. You must also be at risk of default, foreclosure, or displacement because of the financial hardship that the COVID-19 pandemic caused.

You also have to meet additional guidelines like:

  • The property must be owner-occupied and located in Illinois.
  • The property must be your primary residence. Second homes, investment properties, and vacant properties don't qualify.
  • The property must be a single-family home (attached or detached), condo, one- to four-unit dwelling (if you live in one of the units as a primary residence), manufactured home permanently affixed to land and taxed as real estate, or mobile home not permanently affixed to real property.
  • Your household income must be at or below 150% of the area median income.
  • You must be at least 30 days late on your mortgage or property tax payments.

Facing a Foreclosure in Illinois?

Even if a foreclosure has started, you might still have time to get assistance from the Illinois Homeowner Assistance Fund program. Also, you might have time to work out an alternative to foreclosure with your loan servicer.

Your options depend on what kind of loan you have. So, find out what type of mortgage you have, like an FHA-insured, VA-guaranteed, Fannie Mae, or Freddie Mac mortgage. Depending on what entity owns or backs your loan, you might qualify for a special loss mitigation option. For instance, homeowners with a federally backed mortgage loan can get a COVID-19 forbearance while the national emergency declaration is in place. If your loan isn't federally backed, your servicer might offer a forbearance or another form of relief, like a loan modification, if the COVID crisis has financially impacted you. Call your loan servicer or talk to a HUD-approved housing counselor to learn about alternatives. And you may apply for ILHAF if you're still in an existing forbearance.

If you have questions about the foreclosure process in Illinois or want to learn about potential defenses to a foreclosure, consider talking to a foreclosure lawyer. If you're currently in foreclosure, the ILHAF program can connect you to free legal services support if you're not already represented by a lawyer.

How the ILHAF Program Works

Assistance is in the form of a grant that you don't have to repay. Payments from the program go directly to the loan servicer or other approved entity, not to homeowners.

How to Apply to the ILHAF Program

The ILHAF program opens to applicants on April 11, 2022. Go to www.IllinoisHousingHelp.org to apply. First, it's a good idea to attend an informational session to get details about the ILHAF application process, program eligibility criteria, and other available free resources to help you avoid a foreclosure.

You'll also need to contact your loan servicer or a HUD-approved housing counselor to go over alternatives for saving your home. Though consider contacting both your servicer and a housing counselor to learn about your options. A HUD-approved housing counselor will assist you at no cost. To find a counselor near you, go to the ILHAF website, HUD's website, or call 800-569-4287. You'll have to get a certificate from a HUD-certified housing counselor or a letter from your loan servicer describing how you tried to resolve your delinquency to apply for ILHAF assistance.

Also, go over the acceptable documentation list and get ready to provide all required documents with your application.

Avoid Homeowner Assistance Fund Scams

Be wary if you get an unsolicited offer by phone, mail, email, or text message offering mortgage relief or foreclosure rescue services. Scammers are increasingly targeting homeowners who've been affected by COVID-19. Homeowner Assistance Fund programs are free. If anyone asks you to pay a fee to get housing counseling or to receive foreclosure prevention services from this program, it's a scam.

Learn More About the ILHAF Program

If you need help with the application process or have questions about the Illinois Homeowner Assistance Fund program, call 866-454-3571 and read the program's FAQs.

Effective date: April 11, 2022