Minnesotans at risk of foreclosure because of economic or medical hardship have until the end of this week to apply for a new federal program designed to assist with mortgage payments.

Under the Emergency Homeowners’ Loan Program, eligible homeowners can qualify for up to $50,000 in interest-free, forgivable loans to help bring their mortgage current and assist with future payments.

The U.S. Department of Housing and Urban Development had made over $50 million available for the program in Minnesota, which is expected to benefit about 1,400 homeowners statewide.

Applications for the program have been accepted starting July 5 and will be accepted through Friday.

Mary Tingerthal, commissioner of Minnesota Housing, said in a news release that the program is expected to decrease the state’s projected number of 2011 foreclosures by more than 5 percent.

Minnesota Housing is partnering with the Minnesota Homeownership Center to promote the program.

“We know that more than two-thirds of homeowners who seek our foreclosure counseling services have fallen behind on their mortgage because of unemployment, underemployment or medical issues,” said Julie Gugin, director of the Minnesota Homeownership Center, in the release. “This program will offer an important lifeline to a large segment of homeowners who otherwise struggle to find options to stay in their homes.”

Albert Lea Housing and Redevelopment Agency Executive Director Jon Ford said the Albert Lea area is still seeing some of the repercussions of a bad economic situation. He noted that the unemployment rates dropped for a while but now appear to be going back up.

Some people are also still dealing with adjustable rate mortgages or high loan-to-value problems.

To qualify for the Emergency Homeowners’ Loan Program, homeowners must:

• Have faced an income decline of at least 15 percent due to involuntary unemployment or underemployment, or medical issues.

• Have been unable to make their mortgage payment for at least the past three months.

• Reside in the mortgaged residence.

The assistance will pay a portion of the mortgage, and homeowners will be required to contribute either 31 percent of their current monthly income or a minimum of $150, whichever is greater.

The interest-free loan is forgivable for homeowners who stay in their home five years after the two-year program’s conclusion, with 20 percent of the loaned value forgiven each year prior.

To obtain application materials, people should visit the Emergency Homeowners’ Loan Program website at www.EHLPMinnesota.com or call the Minnesota Homeownership Center at 866-462-6466.

Homeowners wishing to participate in the EHLP program must submit evidence of qualification and a complete pre-application via mail to the Minnesota Homeownership Center by 5 p.m. Friday.

Required documentation includes a complete and accurate pre-application screening worksheet, a pre-applicant third-party authorization and a Tennessen warning. All applications will be routed to HUD for entrance in the program lottery.

Homeowners selected in the lottery will be asked to fill out a complete application.