1997 Minnesota Statutes

     462A.207 Mortgage foreclosure prevention and emergency 
  rental assistance program. 

    Subdivision 1.    Establishment.  The agency shall, 
 within the limits of available appropriations, establish a 
 mortgage foreclosure prevention and assistance program to 
 provide assistance to low-income and moderate-income persons who 
 are facing the loss of their housing due to circumstances beyond 
 their control.  Priority for assistance under this section must 
 be given to persons and families at or below 60 percent of area 
 median income, adjusted for family size, as determined by the 
 department of housing and urban development. 

    Subd. 2.    Administration.  The agency may contract 
 with community-based, nonprofit organizations that meet the 
 requirements specified in this section to provide mortgage 
 foreclosure assistance.  Preference must be given to nonprofit 
 organizations that demonstrate the greatest ability to leverage 
 program money with other sources of funding, or to organizations 
 serving areas without access to mortgage foreclosure 
 assistance.  The agency may require an organization to match 
 program money with other money or resources. 

    Subd. 3.    Organization eligibility.  A nonprofit 
 organization must be able to demonstrate that it is qualified to 
 deliver program services, has relevant expertise in mortgage 
 foreclosure prevention, and is able to perform the duties 
 required under the program.  An organization must provide the 
 agency with a detailed description of how the proposed program 
 would be administered, including the qualifications of staff.  
 An organization may not be part of, nor affiliated with, a 
 mortgage lender nor provide assistance to a household which 
 occupies a housing unit owned or managed by the organization. 

    Subd. 4.    Selection criteria.  The agency shall take 
 the following criteria into consideration when determining 
 whether an organization is qualified to administer the program: 

    (1) the prior experience of the nonprofit organization in 
 establishing, administering, and maintaining a mortgage 
 foreclosure prevention program; 

    (2) the documented familiarity of the organization 
 regarding mortgage foreclosure prevention procedures and other 
 services available to assist with preventing the loss of 
 housing; 

    (3) the reasonableness of the proposed budget in meeting 
 the program objectives; 

    (4) the documented ability of the organization to provide 
 financial assistance; and 

    (5) the documented ability of the organization to provide 
 mortgage foreclosure prevention or other financial counseling. 

    Subd. 5.    Designated areas.  A program administrator 
 must designate specific areas, communities, or neighborhoods 
 within which the program is proposed to be operated for the 
 purpose of focusing resources. 

    Subd. 6.    Assistance.  (a) Program assistance includes 
 general information, screening, assessment, referral services, 
 case management, advocacy, and financial assistance to borrowers 
 who are delinquent on mortgage or contract for deed payments. 

    (b) Not more than one-half of program funding may be used 
 for mortgage or financial counseling services. 

    (c) Financial assistance consists of payments for 
 delinquent mortgage or contract for deed payments, future 
 mortgage or contract for deed payments for a period of up to six 
 months, property taxes, assessments, utilities, insurance, home 
 improvement repairs, future rent payments for a period of up to 
 six months, and relocation costs if necessary, or other costs 
 necessary to prevent foreclosure. 

    (d) An individual or family may receive the lesser of six 
 months or $4,500 of financial assistance. 

    Subd. 7.    Repayment.  The agency may require the 
 recipient of financial assistance to enter into an agreement 
 with the agency for repayment.  The repayment agreement for 
 mortgages or contract for deed buyers must provide that in the 
 event the property is sold, transferred, or otherwise conveyed, 
 or ceases to be the recipient's principal place of residence, 
 the recipient shall repay all or a portion of the financial 
 assistance.  The agency may take into consideration financial 
 hardship in determining repayment requirements.  The repayment 
 agreement may be secured by a lien on the property for the 
 benefit of the agency.  

    Subd. 8.    Report.  By January 10 of every year, each 
 nonprofit organization that delivers services under this section 
 must submit a report to the agency that summarizes the number of 
 people served, the number of applicants who were not served, 
 sources and amounts of nonstate money used to fund the services, 
 and the number and type of referrals to other service 
 providers.  The agency shall annually submit a report to the 
 legislature by February 15 that summarizes the service provider 
 reports, and provide an assessment of the effectiveness of the 
 program in preventing mortgage foreclosure and homelessness. 

    HIST: 1993 c 369 s 138; 1997 c 200 art 4 s 16-20