Illinois will launch mortgage assistance program this spring

SPRINGFIELD - Beginning this spring, the Illinois Housing Development Authority will start accepting applications for homeowners experiencing financial hardship during the pandemic.

The Illinois Emergency Homeowner Assistance Fund is a federally funded program.

"I know we've been waiting for these funds for a while and it's really been a holdup from the U.S. Treasury (of) being able to get this money out the door," House Housing Committee Chair Delia Ramirez, a Chicago Democrat, said during a hearing Wednesday.

Funded through the American Rescue Plan Act that passed Congress in March 2021, $387 million will be available through the emergency assistance fund for homeowners.

Homeowners will be able to apply for grants of up to $30,000 that will eliminate or reduce arrearages.

Funds can also be used to prevent mortgage delinquencies and defaults, foreclosures, loss of utilities or home energy services and displacement from financial hardship that occurred after Jan. 21, 2020.

Homeowners must contact their mortgage servicer or a housing counseling agency to ask for help and then, depending on the outcome, can apply for assistance through the state housing authority.

"These are requirements that the federal government and Treasury are imparting to us," agency Executive Director Kristin Faust said. "The homeowner assistance fund is meant to be a fund of last resort."

Faust said agency will begin a public-relations campaign to educate homeowners about how to reach out to counseling agencies or their mortgage provider to start preparing the necessary paperwork for when the application process opens.

"Our goal will be to get all the dollars out the door," Faust said.

Since the pandemic began, the state housing authority has distributed hundreds of millions of dollars in federal funding for rental assistance programs. For the May to July 2021 application period, it distributed more than $593 million to fund nearly 65,000 applications, according to its website.

Faust said the agency expects to distribute about $200 million this year based on the ongoing impact of the pandemic, plus $50 million morefor people who are behind on property taxes.

The state housing authority also allocated $75 million in COVID-19 Affordable Housing Grant Program funds created by the American Rescue Plan. Chrissy Moran, the agency's managing director of multifamily financing, said the funds help developers overcome increased construction costs related to the pandemic.

Currently, the agency has 5,325 units under construction across 22 counties. The grant will help fund an additional 1,800 affordable units for seniors, veterans and families.