$325M in Mortgage Relief Available to New Jersey Homeowners

You might be eligible for free money from the government (up to $35,000) to pay your mortgage and other housing-related 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 $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 New Jersey who've experienced a financial hardship because of the pandemic can get a piece of the $325 million allocated to the state ($270 million is earmarked for direct homeowner assistance) from the New Jersey Emergency Rescue Mortgage Assistance (NJ ERMA) program. This program uses federal money, up to $35,000 per household, to help homeowners pay mortgage payments and other housing-related expenses, like property taxes and homeowners' insurance.

Free Money for Eligible New Jersey Homeowners During the COVID-19 Pandemic

The NJ ERMA program offers money to eligible New Jersey homeowners to:

  • reinstate a delinquent mortgage loan (principal, interest, taxes, and insurance), including payments that were missed because of a forbearance plan
  • cover mortgage payments of principal, interest, taxes, and insurance going forward (you can get a one-time payment to cover arrearages and up to four months of future mortgage-payment assistance), and
  • pay overdue property taxes, municipal liens, or utility liens.

Eligibility Requirements for New Jersey's Homeowner-Relief Program

To qualify for relief from the NJ ERMA 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.

Also, you must meet the following eligibility requirements:

  • You must be behind in your mortgage payments or other eligible housing expenses.
  • Your mortgage or other housing costs must not have been 30 or more days delinquent before January 21, 2020.
  • You must currently own and occupy the property, located in New Jersey, as your primary residence. Eligible homes include one-to-four unit properties, which may be a detached house, condominium unit, or manufactured home on a foundation permanently affixed to real property. Second homes and investment properties don't qualify.
  • Your annual household income must be equal to or less than 150% of the area median income.
  • Your unpaid mortgage balance can't exceed program limits for the property type.

Homes already in foreclosure are eligible for assistance. And if you already received funds from the state's Hardest Hit Fund programs, such as HomeKeeper and HomeSaver, you can still apply to get money from this new fund.

Take a prescreening quiz to find out if you're eligible for the NJ ERMA program. You can find a link on the NJ ERMA website.

How the NJ ERMA Program Works

Assistance will be in the form of a subordinate lien recorded against your home that's forgivable after three years. You only have to repay the assistance if you sell your home or receive cash back from a refinancing within three years.

The assistance payment goes directly to your loan servicer or other approved entity, like the tax office or insurance company.

How to Apply for Assistance From the NJ ERMA Program

The NJ ERMA program will start accepting applications on February 8, 2022, at 9:00 a.m. ET. To apply, go to the NJ ERMA website and register for an account.

You'll have to provide some documentation with your application, including a government-issued ID (like a driver's license), paperwork showing your housing-related costs, such as mortgage statements, as well as proof of income, such as pay stubs, bank statements, and tax returns. For a complete list of items you'll need, go here.

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 are increasingly targeting homeowners who've been affected by COVID-19. Getting help from the NJ ERMA 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. If you experience fraud associated with this program, be sure to report it.

Learn More

For more information about available assistance from this program, call 855-647-7700 or email HAFServicing@njhmfa.gov or go to the NJ ERMA website, where you can find a list of FAQs.

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 the NJ ERMA program's "Find a Counselor" website, visit HUD's website, or call 800-569-4287.

Effective date: February 8, 2022