State warns homeowners to apply for relief now as foreclosure deadline looms

The state of Minnesota warned homeowners who have federally backed mortgages to apply for relief now to avoid foreclosure.

According to the state’s departments of commerce and housing, the deadline for mortgage relief applications has been extended to Feb. 28, but that residents should start applying now if they are eligible.

About 15 percent of Minnesota mortgages are federally backed, or about 120,000.

About 13,000 homeowners, or about one in ten, have delinquent federally backed mortgages, meaning they are behind on payments and could be impacted by the foreclosures.

Federally backed loan payments could be delayed for six to 12 months thanks to the CARES Act passed by congress if homeowners could prove their inability to pay due to the pandemic.

The state of Minnesota offered the following resources to homeowners: 

Homeowners with federally backed mortgages can learn more about mortgage relief, how they are eligible and how to apply for mortgage assistance in the Consumer Relief Guide [PDF].  For additional details on mortgage relief, see this Commerce consumer alert from May 19, 2020. 

Loan types that are federally backed and therefore are required to be provided relief include:

  • Conventional loans purchased or securitized by Fannie Mae and Freddie Mac
  • Federal Housing Administration (FHA), including Home Equity Conversion Mortgage (HECM)
  • U.S. Department of Veteran Affairs (VA)
  • U.S. Department of Agriculture (USDA) Rural Development (RD) loans, including direct and guaranteed loans

If you have a question, contact the Minnesota Homeownership Center at 651-659-9336 to speak to a nonprofit homeownership advisor who can help you navigate your situation. Services are free.  Find a homeownership advisor near you today to get the help you need.