Oregon Mortgage Relief: A Homeowner's Resource for Foreclosure Prevention

For Oregon homeowners facing financial hardship, the possibility of falling behind on mortgage payments can be an overwhelming source of stress. The landscape of available assistance has changed significantly, and knowing where to turn for reliable help is the first and most critical step toward stability.

This resource provides a clear and accurate overview of the current state of mortgage relief in Oregon, focusing on the active programs and official channels designed to help homeowners prevent foreclosure. While major pandemic-era relief funds have concluded, a robust system of support remains in place, centered on mediation, expert counseling, and local assistance programs.

The Current State of Mortgage Assistance in Oregon

Navigating mortgage relief begins with understanding which programs are active and which have ended. Several high-profile initiatives that provided substantial aid during the COVID-19 pandemic are now closed. It is essential for homeowners to have the most current information to avoid confusion and pursue the right avenues for help.

A Closed Chapter: The Homeowner Assistance Fund (HAF)

It is critical for homeowners to know that the Oregon Homeowner Assistance Fund (HAF) is closed and no longer accepting new applications. This federally funded program was established under the American Rescue Plan Act to provide emergency relief to homeowners who experienced financial hardship due to the COVID-19 pandemic.

During its operation, the HAF program was a vital lifeline, disbursing over $72 million to 2,619 Oregon households. The aid, which averaged $27,429 per household, helped homeowners catch up on past-due mortgage payments, property taxes, and other housing-related costs. This assistance was typically structured as a no-interest, five-year, forgivable loan.

Homeowners who previously received HAF funds and are now selling or refinancing their property may need a payoff statement. These statements can be ordered by sending an email to haf.payoffs@hcs.oregon.gov.

Status of the Oregon Homeownership Stabilization Initiative (OHSI)

Similarly, the Oregon Homeownership Stabilization Initiative (OHSI) is also closed to new applications. This earlier program was created in response to the Great Recession and later extended to assist those impacted by the pandemic.

OHSI offered various forms of assistance, including one-time payments to bring delinquent mortgage accounts current. Homeowners who participated in OHSI and need a payoff statement for their loan should direct their requests via email to ohsi.payoffs@hcs.oregon.gov.

Active Solutions: Where to Turn for Help Now

The closure of these large-scale subsidy programs marks a significant change in Oregon's approach to mortgage relief. The strategy has evolved from providing emergency financial injections to empowering homeowners with procedural rights and expert guidance.

The primary, active resources available to homeowners in distress are now the Oregon Foreclosure Avoidance Program (OFAP) and the statewide network of free, certified housing counselors. This shift indicates a focus on creating sustainable, long-term solutions through negotiated loan modifications rather than temporary financial patches.

These programs are supported by a partnership between Oregon Housing and Community Services (OHCS), the Oregon Department of Justice (DOJ), and the Oregon Division of Financial Regulation (DFR). The central online hub for homeowners seeking these resources is oregonhomeownerhelp.org.

The Oregon Foreclosure Avoidance Program (OFAP): Your Right to Mediate

For homeowners facing the threat of foreclosure, the Oregon Foreclosure Avoidance Program (OFAP) is the state's most powerful tool for intervention. It is not a financial assistance program but a legally mandated mediation process that provides homeowners with the right to a formal negotiation with their lender.

What is the OFAP?

The OFAP is a mandatory, statewide program created by the Oregon Legislature. It provides a structured and fair process for homeowners and lenders to find an alternative to foreclosure. Before most lenders can initiate a foreclosure, they are legally required to invite the homeowner to a "Resolution Conference". The program's core purpose is to facilitate direct communication and compel a good-faith negotiation aimed at keeping Oregonians in their homes.

Who is Eligible to Participate?

The program is available to a broad range of homeowners in distress. You are eligible to participate if:

• You have received a formal "Notice of Resolution Conference" from your lender.
• You are currently behind on your mortgage payments.
• You are not yet behind on payments but are experiencing a significant financial hardship and wish to proactively request a resolution conference.

The OFAP Process: A Four-Step Walkthrough

The path to a resolution conference is straightforward and designed to be accessible. It involves four key steps.

1. Pay the Fee: A homeowner must pay a participation fee, which ranges from $50 to $175 based on household income. A fee waiver is available for low-income households. Adhering to the payment deadline is critical; failure to pay on time can permit the lender to proceed with foreclosure without a meeting.
2. Meet with a Housing Counselor: This mandatory step is one of the most valuable aspects of the program. Homeowners meet with a certified foreclosure prevention counselor who provides free, expert advice and helps prepare the required documents.
3. Submit Your Documents: With the counselor's help, the homeowner submits financial documents through a secure online portal. This package typically includes proof of income, bank statements, and a hardship letter. Failing to submit documents on time will severely limit the possibility of reaching a successful agreement.
4. Attend the Resolution Conference: This is the formal meeting with the lender, which can be held virtually or in person. The conference is led by a neutral facilitator, and the homeowner has the right to be accompanied by their housing counselor and/or an attorney.

The Resolution Conference: What to Expect

The resolution conference is structured to create a level playing field. By law, the lender must send a representative who possesses the full and complete authority to negotiate and commit to a foreclosure avoidance measure on the spot. This requirement prevents common delay tactics.

Furthermore, before the conference, the lender must provide the homeowner with a comprehensive set of documents about their loan, including a full payment history and an itemized statement of arrears. This transparency allows the homeowner and their counselor to prepare effectively. The neutral facilitator ensures the discussion remains productive and focused on finding a resolution.

Potential Outcomes of the OFAP

While the program does not guarantee a specific outcome, it mandates a structured, good-faith negotiation. Potential resolutions include:

• A loan modification to make payments more affordable.
• A forbearance plan to temporarily pause or reduce payments.
• A repayment plan to catch up on past-due amounts over time.
• A "graceful exit," such as a short sale or a deed-in-lieu of foreclosure, which may include a small payment to assist with relocation.

The Most Important First Step: Connecting with a Housing Counselor

Regardless of the path a homeowner pursues, the single most important first step is to connect with a certified housing counselor. This free service is the central pillar of Oregon's foreclosure prevention strategy, providing homeowners with an expert advocate and a clear plan of action.

Why a Housing Counselor is Your Best Ally

Housing counselors are highly trained professionals who specialize in foreclosure prevention, credit counseling, and budgeting. They work for nonprofit agencies approved by the U.S. Department of Housing and Urban Development (HUD), and their services are provided at no cost to the homeowner. A HUD-approved counselor's only objective is to help the homeowner achieve the best possible outcome.

What a HUD-Approved Counselor Does for You

A housing counselor provides comprehensive support that goes far beyond simple advice. Their key functions include:

• Comprehensive Financial Assessment: The counselor conducts a detailed review of the homeowner's complete financial picture to determine what level of mortgage payment is sustainable.
• Explanation of All Options: Based on the assessment, the counselor clearly explains all available foreclosure alternatives, empowering the homeowner to make an informed decision.
• Application Preparation and Submission: A counselor assists in gathering all necessary documents, completing the forms correctly, and submitting a strong, complete package to the mortgage servicer.
• Advocacy and Negotiation: Counselors can communicate and negotiate directly with the lender on the homeowner's behalf, ensuring the case receives proper attention.

The housing counseling network serves as a crucial entry point to the state's entire foreclosure prevention ecosystem. Counselors perform an essential triage function, directing homeowners to the right resource efficiently.

What to Expect and How to Prepare for Your First Meeting

A typical initial counseling session lasts between 60 and 90 minutes. To maximize the value of this meeting, homeowners should try to collect the following items in advance:

• The most recent mortgage statement.
• Proof of income for the last two months.
• The last two years of filed federal tax returns.
• Bank statements for the last two months (all pages).
• A list of all monthly household expenses.
• Statements for any other debts (car loans, credit cards, etc.).
• Any correspondence received from the mortgage lender.

How to Find a Certified Counselor in Oregon

Finding a free, reputable housing counselor is straightforward. Homeowners should use one of these official channels:

• Statewide Hub: Visit oregonhomeownerhelp.org or dial 211 from any phone.
• Oregon Housing and Community Services (OHCS): Call 800-453-5511 for assistance with scheduling an appointment.
• Federal Government Resources: The Consumer Financial Protection Bureau (CFPB) and HUD both provide national, searchable databases of all approved housing counseling agencies.

Understanding Oregon's Foreclosure Landscape

To effectively navigate the available relief options, it is helpful to have a basic understanding of the legal framework for foreclosure in Oregon. The process a lender must follow determines the timeline and the specific intervention points available.

Two Paths to Foreclosure in Oregon

Foreclosure is the legal process by which a lender can seize and sell a property to recover the balance of a loan in default. In Oregon, lenders can pursue one of two distinct paths: nonjudicial foreclosure or judicial foreclosure.

Nonjudicial Foreclosure

This is the most common method used in Oregon because it is faster and less expensive. A nonjudicial foreclosure takes place entirely outside of the court system. The process is governed by a series of legally required notices, including a "Trustee's Notice of Sale," which must be sent at least 120 days before the scheduled auction.

The OFAP was designed specifically to insert a critical checkpoint into this nonjudicial timeline. It creates a mandatory "pause" for a structured, supervised negotiation, ensuring homeowners have a guaranteed opportunity to be heard.

Judicial Foreclosure

A judicial foreclosure is a more traditional process where the lender files a lawsuit against the homeowner. The entire process is managed through the court system, allowing the homeowner to raise legal defenses and have their case heard by a judge. If you receive any legal papers indicating a lawsuit has been filed, it is imperative to seek legal assistance from an attorney as soon as possible.

Protecting Yourself: How to Identify and Avoid Foreclosure Scams

Homeowners in financial distress are often targeted by predatory companies offering fraudulent "foreclosure rescue" services. The Oregon Department of Justice (DOJ) makes it a priority to protect homeowners from this type of fraud.

Red Flags: Warning Signs of a Scam

Be extremely cautious and recognize the warning signs of a potential scam. Be wary of any individual or company that:

• Guarantees to stop a foreclosure.
• Instructs you to stop making payments to your mortgage lender and pay them instead.
• Asks you to transfer or sign over the deed to your property.
• Charges significant upfront fees for services.
• Pressures you to sign documents immediately.
• Claims to have a special relationship with your lender or the government.

Protective Actions: How to Stay Safe

The best defense against scams is to be proactive and informed. Follow these protective measures:

• Work Only with Official, Approved Agencies: Only seek assistance from a HUD-approved housing counseling agency.
• Never Pay Upfront for Counseling: Free, high-quality assistance is available from nonprofit counselors.
• Communicate Directly with Your Lender: Use the contact information on your official mortgage statement.
• Get All Agreements in Writing: Never rely on verbal promises. Insist on a written contract that clearly details all services.

How to Report Suspected Fraud in Oregon

If you believe you have encountered a foreclosure rescue scam, it is vital to report it to the authorities.

• File an Online Complaint: Submit a report using the Oregon DOJ's official Consumer Complaint Form.
• Call the Consumer Protection Hotline: Speak directly with the DOJ by calling 1-877-877-9392.

Additional and Local Mortgage Relief Resources

While the OFAP and housing counselors are the primary statewide resources, some homeowners may be eligible for additional assistance through more localized or specific federal programs.

City of Portland Homeowner Foreclosure Prevention

The Portland Housing Bureau administers a program specifically for low-income residents within the city of Portland. This initiative provides access to foreclosure prevention counseling and may also offer direct financial assistance to help eligible homeowners make payments to their mortgage company, utility company, or tax collector.

Community in Action Programs

Community in Action, a nonprofit organization, has offered several programs to help homeowners. The availability of these programs can vary, so it is best to check with the organization directly. Past programs have included:

• Home Rescue Program: Provided up to one year of mortgage payments, with a maximum benefit of $20,000.
• Principal Reduction and Lien Extinguishment (PR/LE) Program: Offered up to $50,000 to reduce the principal balance of a mortgage for homeowners on a fixed income.
• Preservation Benefit: Provided up to $40,000 to fully reinstate a first-lien mortgage for homeowners who could afford their ongoing payments but had fallen behind.

USDA Section 504 Home Repair Program

For very-low-income homeowners living in eligible rural areas, the U.S. Department of Agriculture (USDA) offers the Section 504 Home Repair program. This program provides:

• Loans of up to $40,000 with a fixed 1% interest rate to repair or modernize a home.
• Grants of up to $10,000 for homeowners aged 62 or older to remove health and safety hazards.

By providing funds for critical repairs, this program can prevent homeowners from having to choose between making their mortgage payment and maintaining a safe living environment.

Summary of Oregon Mortgage Assistance Resources

The array of programs can be confusing. The table below provides a quick, at-a-glance summary of the primary mortgage relief and foreclosure prevention resources available to Oregon homeowners.

Frequently Asked Questions