Maryland Stimulus Aid: All You Need to Know About Grants & the Mortgage Payment Homeowner Assistance Fund

The Homeowner Assistance Fund was established by the American Rescue Plan Act enacted on March 11, 2021, to help homeowners experiencing financial hardship after January 21, 2020. The Maryland Department of Housing and Community Developm​ent expects to receive approximately $250 million through this program to assist homeowners struggling with their mortgage payments or other housing costs due to the COVID-19 pandemic. The department is currently developing plans on implementing this program in the state in accordance with federal regulations, and expects to open the program later in 2021. When program application information is available, it will be posted to this website.

Homeowner Assistance Fund (HAF) Purpose

• The goal of the American Rescue Plan and of the Homeowner Assistance Fund is to help the nation recover from a once-in-a-generation disaster that has imposed substantial economic hardship on millions of working families through no fault of their own.
• With nearly $250 million appropriated to the state of Maryland, the HAF will be available to potentially assist over 10,000 households (including socially disadvantaged households) to avoid displacement through financial assistance or home rehabilitation and weatherization.
• These funds will assist eligible applicants who were unemployed and/or underemployed as of 3/1/2020, resulting in a risk of displacement.

Milestone Timeline

• Public review and comment on draft plan in mid-June, 2021
• HAF plan due to US Treasury on June 30, 2021
• Phased assistance program roll-out

Assistance Types

Assistance will focus on avoiding displacement of homeowners and will take one of the following forms:

Type 1 – “Emergency Displacement Diversion” grant to avoid imminent displacement (within 90-days) due to:

• Tax delinquency, chattel loan or land lease (ground lease) delinquency
• Homeowner’s association fee / condominium association fee delinquency
• Low mortgage delinquency amount (under $5,000)

Type 2 – “Fresh Start” loan to offer a one-time payment of a delinquent mortgage amount and, if needed, additional funds to facilitate a principal curtailment or rate reduction to right size ongoing mortgage payments to levels affordable to the homeowner, after the respective loan servicer exhausts all other loan modification options.

The two types of assistance may be layered.

Eligibility Criteria

Emergency Displacement Diversion Grant assistance (Type 1)

• Eligible financial hardship; and
• Less than 100% of AMI; and
• Proof of imminent displacement threat
• Homeowners who have received a Notice of Intent to foreclose;
• $5,000 maximum grant amount
• Fresh Start Loan assistance (Type 2)
• Eligible financial hardship; and
• Less than 150% of AMI; and
• Homeowners who have not received a foreclosure notice; and
• Homeowners who are not in active bankruptcy
• $30,000 maximum loan amount

Fresh Start Loan Terms (Assistance Type 2)

• Recorded lien
• 0% interest
• Deferred payments for the life of the first mortgage
• Payments due in full when the first mortgage ends (repayment, refinance, transfer, sale)
• Repayment is subject to review and the department may, based on homebuyer situation and needs at the time of repayment:
• Require payment in full
• Establish a payment plan
• Allow full or partial forgiveness

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Notes on Operations

• All applications must be made through the web-based portal with an automated eligibility screening tool at the front end
• Housing counseling agencies will be recommended to all homeowners and available to assist homeowners who need support with submitting an application due to technology challenges, language barriers, complex cases, etc.
• Call center to field incoming contacts
• Applications processed by DHCD
• Escalation group to resolve special cases and an exceptions review committee to consider program requests

Partnerships and Vendors

Partnerships will be created or enhanced with:

• Housing counseling agencies
• Legal services
• Mortgage servicers
• Community groups and other marketing/outreach facilitators

Vendors will be engaged to provide:

• IT solutions to support application intake/processing
• IT solutions to support payments
• IT solutions to support ongoing asset management and servicing
• Marketing planning, design and purchases

Marketing

• Marketing will focus first on direct methods of reaching homeowners in the state portfolio, then will expand to cover entire state
• Marketing will focus on reaching target households (low income and socially disadvantaged) and geographic areas populated disproportionately by target households
• Unified Call center to handle incoming contacts generated by marketing Website Resources
• FAQ
• Preliminary Eligibility / Required Documentation
• Contacts for Counseling Agencies doing Intake
• Steps for Non-Eligible Homeowners

Enhanced Weatherization Program

An enhanced weatherization program will be created in addition to the mortgage rescue assistance detailed in this presentation

$10 million set aside program budget

• Leverage existing homeowner rehabilitation and weatherization funding
• Leverage existing application, finance and construction infrastructure
• Purpose is to assist legacy homeowners to address health and safety, code and energy efficiency standards in their homes

Notice is hereby given that the Community Development Administration (the “Administration”), a unit of the Division of Development Finance of the Maryland Department of Housing and Community Development, will conduct two public conference calls concerning the Homeowner Assistance Fund (HAF) established by the U.S. Department of the Treasury, under section 3206 of the American Rescue Plan Act of 2021.

The first conference call will be open between 11 a.m. and 12 p.m. on June 16, 2021, and the second one will be open between 11 a.m. and 12 p.m. on June 18, 2021.

Oral comments will be limited to no more than five (5) minutes per person. The virtual conference will be accessible at the aforementioned date and time at the following toll-free telephone number: 1-301-298-1561, access code 373245.

Additional information relating to HAF is available in the HAF presentation at https://dhcd.maryland.gov/Residents/Pages/HomeownerAssistanceFund.aspx. All interested parties are invited to submit written comments/questions and/or present oral comments/questions by accessing the same link and/or at the public conference calls mentioned above.

Get answers from professionals and find out what you can do to get into a new mortgage program here.

Resources for Homebuyers, Homeowners and Renters

A family’s home is their most important asset, and housing counseling helps ensure that potential and current homeowners are educated and empowered to make informed decisions about purchasing or preserving that home. To that end, the Department of Housing and Community Development supports a statewide network of non-profit and local government agencies that provide critical assistance to homebuyers, homeowners, and renters.

Homebuyer Education & Pre-purchase Counseling

Buying a home can be overwhelming. A HUD-certified, professional housing counselor will empower you to make informed decisions, help you navigate the home buying process, and connect you to resources for the down payment and closing cost assistance. If you are considering purchasing a home, contact a HUD-approved housing counseling agency in your area for help with assessing your options and making the decisions that are right for you.

HUD-Approved Housing Counseling Agencies in Maryland

Foreclosure & Rental Counseling

If you are a homeowner who has fallen behind on your mortgage payments, getting help early in the process can mean the difference between saving your home and losing it to foreclosure. A housing counselor can help you understand your options based on your specific circumstances and can assist you with finding a solution that works best for you.

If you are a renter concerned about eviction, a housing counselor can provide information about a broad range of topics including rental assistance programs, fair housing, housing search assistance, landlord-tenant laws, lease terms, rent delinquency, budgeting for rent payments, and providing assistance with locating alternate housing.

Contact a housing counselor today!​

Legal Services

If your mortgage company initiates a foreclosure action in court (i.e. files a Notice of Intent to Foreclose), you should consider seeking legal assistance as soon as possible. Free or low-cost legal assistance is available for eligible homeowners. Contact a provider.

If you are a renter concerned about eviction, legal assistance is available to help you better understand your rights and protections under Maryland law. Contact a provider.

The Maryland Department of Housing and Community Development (DHCD) is committed to assisting our customers during these uncertain times. If you suspect you may have trouble making mortgage payments, be proactive. Reach out to your mortgage servicer (the company that processes your monthly mortgage payment) and explain your current situation to them.

​Governor Hogan (4/3/2020), issued an emergency order to provide additional and immediate financial relief for Marylanders facing economic hardship due to COVID-19. Nearly 70 of the state’s banks and financial institutions have agreed to a program to provide a 90-day period of forbearance and deferral on mortgages.

The Governor’s emergency order for mortgage lenders:​

• Prohibits commercial and industrial evictions, expanding the previous order banning residential evictions.
• Mortgage lenders and servicers will provide up to a 90-day forbearance or deferral period for mortgage payments.
• Mortgage lenders and servicers will not charge late fees during the forbearance or deferral period.
• Mortgage lenders and servicers will not report negative information to the credit bureaus during the forbearance or deferral period.
• 90 Days Forbearance from Foreclosure Initiation.

You must contact your financial services provider to take advantage of this relief.