The Homeowner Assistance Fund: How a $9.961B Federal Program Kept Pandemic-Era Homeowners Out of Foreclosure

What the Homeowner Assistance Fund is

The Homeowner Assistance Fund (HAF) is a federal foreclosure-prevention program created by Section 3206 of the American Rescue Plan Act of 2021 (ARPA), which President Biden signed into law on March 11, 2021. Congress appropriated $9.961 billion and directed the U.S. Department of the Treasury to distribute the money to states, the District of Columbia, U.S. territories, and tribal governments so they could stand up their own homeowner relief programs.

The U.S. Treasury announced the program and opened the application process for state and tribal administrators on April 14, 2021, publishing a HAF guidance document the same day. That launch set the framework every state program was built on: HAF is not a direct federal hand-out, it is a block grant that funds locally run assistance programs tailored to each jurisdiction's housing market and legal environment.

Who HAF was designed to help

HAF targeted homeowners who had fallen behind because of a financial hardship tied to the COVID-19 pandemic on or after January 21, 2020. Treasury guidance required that at least 60% of a jurisdiction's HAF funds be reserved for homeowners with incomes at or below 100% of area median income (AMI) or 100% of the median income for the United States, whichever was greater. Programs could serve homeowners up to 150% of AMI within that framework.

Eligible uses included:

• Past-due mortgage payments and reinstatement of delinquent loans
• Principal reduction and loan-modification support
• Delinquent property taxes to prevent tax-sale foreclosure
• Delinquent homeowner, condo, or HOA fees
• Homeowner's insurance, flood insurance, and mortgage insurance shortfalls
• Utility arrears (gas, electric, water, sewer, internet in many states)
• Reverse-mortgage property-charge defaults
• Counseling and legal services tied to avoiding foreclosure

Payments almost always went directly to the mortgage servicer, taxing authority, HOA, or utility, not to the homeowner. That servicer-direct design is one reason HAF was effective at preventing foreclosure: the money landed where the delinquency was, without passing through a household budget already under strain.

Why Congress created it

By early 2021, roughly 2.7 million U.S. homeowners were in active mortgage forbearance plans authorized by the CARES Act. Policymakers expected a foreclosure wave once those protections ended, especially for borrowers with FHA, VA, and USDA loans and for homeowners of color, who had entered forbearance at disproportionately high rates.

HAF was designed as the counterpart to the Emergency Rental Assistance (ERA) program that had been created weeks earlier for renters. Together, HAF and ERA formed the federal pandemic housing-stability backbone: ERA paid landlords to keep tenants housed, HAF paid servicers and tax offices to keep owners housed.

How the money was allocated

Treasury divided the $9.961 billion using a formula that combined each state's share of unemployed homeowners and its share of homeowners with mortgage payments more than 30 days past due or in foreclosure, based on Census Household Pulse Survey and mortgage performance data. A minimum of $50 million was guaranteed to every state, the District of Columbia, and Puerto Rico. Separate set-asides funded tribes and tribally designated housing entities ($498 million) and the U.S. territories ($30 million).

The largest state allocations included California (approximately $1.0 billion), Florida ($676 million), New York ($539 million), Texas ($842 million in later adjusted figures reported by Treasury), and New Jersey and Pennsylvania in the $325-$350 million range.

How HAF actually rolled out

States were required to submit a HAF Plan to Treasury for review before they could draw more than a small administrative advance. Because each jurisdiction had to design intake, eligibility, contracting, and servicer coordination essentially from scratch, most state programs did not begin accepting applications until late 2021 or the first half of 2022. That ramp was slow enough that by late 2021 consumer advocates were publicly warning that HAF was not yet open in most states even though federal forbearance protections were already expiring.

Once operational, HAF programs paid out quickly. National Council of State Housing Agencies (NCSHA) tracking showed that by the end of 2023 state programs had deployed more than $5.5 billion in HAF assistance to more than 400,000 households nationwide, with mortgage reinstatement and delinquent property taxes the two largest categories of spending.

Where HAF stands now

HAF is a finite, one-time appropriation. Treasury set a program deadline of September 30, 2026, for jurisdictions to fully expend their funds, with obligation deadlines earlier in 2025 depending on the state. As funds run low, many state HAF programs have closed new applications in waves during 2024 and 2025. Some states with remaining balances reopened targeted intake for specific hardships, such as reverse-mortgage defaults or post-disaster delinquencies, while others redirected closing balances toward counseling, legal aid, and loss-mitigation outreach.

The program is widely credited as one of the clearest pandemic-era housing policy successes: unlike the Hardest Hit Fund rollout after the 2008 crisis, HAF moved money to homeowners faster, covered a broader set of delinquencies (taxes, insurance, HOA fees, utilities — not just mortgage principal), and was paired with strong servicer-coordination rules through the federal Common Data File standard.

What homeowners should do today

If you are a homeowner who fell behind because of a COVID-19 hardship and have never applied, check your state housing finance agency's HAF page right away — many programs are now closed to new applicants, but some still accept narrow categories of cases. If your state's program has closed, ask your mortgage servicer about loss-mitigation options (loan modification, partial claim, deferral) and contact a HUD-approved housing counselor for free at 1-800-569-4287. Even after HAF, those servicer tools remain the core federal foreclosure-prevention toolkit.