$50M in Mortgage Relief Available to South Dakota Homeowners

Eligible South Dakota homeowners can get a loan of up to $25,000 to pay their mortgage payments or a grant of up to $5,000 to pay utility costs.

By , Attorney · University of Denver Sturm College of Law

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 South Dakota who've experienced a financial hardship because of COVID-19 can request some of the approximately $50 million allocated to the state by submitting an application to the SD CARES Housing Assistance Program. This program uses federal money to give loans to homeowners to make mortgage payments and grants to pay utility costs.

What Housing Costs Are Covered Under the SD CARES Housing Assistance Program?

Specifically, you can use money from the SD CARES Housing Assistance Program to pay:

  • up to $25,000 in overdue mortgage bills (principal and interest), property taxes, homeowners' insurance, late fees, and
  • as much as $300 per month (a maximum of $5,000 total) for utility costs and utility arrears, such as water, sewer, electricity, propane/natural gas, and trash costs.

Eligibility Requirements for the SD CARES Housing Assistance 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, or have qualified for unemployment benefits) after January 21, 2020, because of COVID-19.

You also have to meet these guidelines:

  • You must be a South Dakota resident.
  • Your household income must be equal to or less than 100% of the area median income.
  • You must have one or more individuals in your household with a past-due utility bill or mortgage statement or are able to prove that you're at risk of experiencing homelessness or housing instability.
  • You must own and occupy the property as your primary residence. Second homes, investment properties, and vacant properties don't qualify.

How the SD CARES Housing Assistance Program Works

Assistance for mortgage payments and other related costs is structured as a 0% interest loan, with no payments due, which must be repaid when you sell, refinance, or transfer ownership of the property, or when the home is no longer your primary residence. Utility assistance is a grant, which 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 for Assistance From the SD CARES Housing Assistance Program

Apply online or with your smartphone through the SD Cares Housing Assistance Program Application website. You'll have to provide some documentation with your application, like mortgage information or utility bills, proof of income, such as pay stubs and tax returns, and photo identification (a driver's license or state/tribally-issued identification).

If you need help with your application, South Dakota has the following partner agencies that can assist you:

Facing a Foreclosure in South Dakota?

Even if a foreclosure has started, you might still have time to get assistance from the SD CARES Housing Assistance Program. Though, if financial assistance from the program is unlikely to prevent a foreclosure, you probably won't qualify for help from it.

Also, you might have time to work out an alternative to foreclosure with your loan servicer.

Avoid Homeowner Assistance Fund Scams

If you get an unsolicited offer by phone, in the mail, through email, or by text message offering mortgage relief or foreclosure rescue services, be wary. 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 SD CARES Housing Assistance Program

If you have questions or need help with your application, call 605-773-3181, dial 2-1-1, or email info@sdhda.org. You can also review the program's FAQs.

You may also get help from 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.