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.
Once the Montana Homeowner Assistance Fund program gets rolling, homeowners who've experienced a financial hardship because of the pandemic can get a portion of the approximately $50 million allocated to the state by submitting an application. This program will use federal money to help eligible homeowners make mortgage payments and pay other home-related costs, like property taxes, insurance, and utilities. Assistance is in the form of a no-interest loan or a grant that you don't have to pay back.
You can use money from the Montana Homeowner Assistance Fund program to pay for the following items, among others:
The amount you can get varies depending on what kind of assistance you receive. For example, you can get up to $25,000 in the form of a loan to reinstate a delinquent mortgage, a $5,000 grant to prevent a property tax foreclosure or to pay off homeowners' association liens, a $300 grant to pay overdue utilities, and $50 per month (in the form of a grant) for past-due internet services.
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 the coronavirus pandemic. You also have to meet additional guidelines like:
Some assistance, like for mortgage payments, is in the form of a 0% interest loan, which becomes due when your first mortgage ends or when you sell, refinance, or transfer the property. Other kinds of assistance, like paying overdue property taxes and utilities, are 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.
Once the program opens, you can submit your application online. To receive updates about when the program will start, subscribe to the program's email and text list. You can also go to housing.mt.gov to watch for updates.
In the meantime, you can take steps to get ready to apply once the program begins. Start organizing the documents you'll need, such as your most recent tax return and paystubs, photo ID, mortgage statement or property tax statement, and utility statements.
Also, find out what type of mortgage you have, like an FHA-insured, VA-guaranteed, Fannie Mae, or Freddie Mac mortgage. You might qualify for a special loss mitigation option, depending on what entity owns or backs your loan. Call your loan servicer to learn about what alternatives are available.
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.
If you need help with the application process or have questions about the Montana Homeowner Assistance Fund program, 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.
Effective date: April 5, 2022