Minnesota launches pandemic assistance fund for homeowners

Minnesota homeowners hurt financially by the pandemic can now apply for up to $35,000 in assistance for mortgage payments and other housing-related expenses through a new state program called HomeHelpMN.

The program is funded with $109 million from the federal government through the American Rescue Plan Act of 2021.

Minnesota Housing Commissioner Jennifer Ho announced the program’s launch on Tuesday, urging people to sign up as soon as possible.

“This is not a program for procrastinators,” Ho said. “The time to apply is now.”

Ho estimates as many as 25,000 households across the state may be eligible, but the program will only have enough to fund 8,000 households.

Eligible households are those that have experienced a loss of income and earn less than local income threshholds, set at 100% of the area median income for the county or the median income for the United States as a whole. That’s $117,300 for a four-person household in Hennepin County or $90,000 in St. Louis County.

Applications will be awarded mostly on a first-come, first-served basis, with priority given to those households at immediate risk of foreclosure. While applications will be accepted until June 17 at 5 p.m., Ho said the funds could be depleted before the application deadline.

The funds can be used to pay for mortgage costs, property taxes, lot fees for mobile homes, association fees and other housing-related expenses.

But the funds can only be used for unpaid bills, meaning homeowners who experienced financial hardship but managed to continue making mortgage payments are not eligible for assistance.

Ho said she hopes the program will help prevent the state’s large homeownership gap between white people and people of color from growing even wider. Roughly 77% of the state’s white residents own their own homes compared to 49% of Latino residents, 48% of Native American residents and 25% of Black residents.

The program’s launch comes months after Ho’s agency abruptly shuttered its program providing rental assistance to Minnesota residents in January after depleting the $518 million it had received from the federal government.

Minnesota Housing faced harsh criticism for both delays in rolling out the rental assistance program and making payments to renters in need. Ho blamed complicated federal regulations and the sheer size of the program —roughly 10 times the size of her agency’s annual budget — for the delay.

Ho said similar barriers stopped them from rolling out HomeHelpMN sooner. Ho said they had to wait for guidance from the U.S. Department of the Treasury, issued in February, and then wait for the Treasury Department to approve their program plan.

Other states have been able to launch their programs sooner. New York became the first state to accept applications in December. Pennsylvania started accepting applications in February and Texas in March.

“It’s not always best to be first,” Ho said. “And we’ve benefited from the early learnings of those who got out ahead of us.”

*This story originally misstated the application deadline. It has been corrected.