In the wake of Hurricane Harvey and Hurricane Irma, the Department of Housing and Urban Development has made announcements about disaster relief as certain parts of the country become federally-declared disaster areas. The latest of these is a press release from HUD on relief efforts to Puerto Rico.
According to a press release on the FHA/HUD official site, “HUD will speed federal disaster assistance to the Commonwealth of Puerto Rico and provide support to homeowners and low-income renters forced from their homes due to Hurricane Irma.”
That assistance includes a 90-day moratorium on foreclosure action for FHA mortgages, the availability of FHA rehab loans for disaster victims, and more. According to HUD, these options can help those in the affected areas recover, rebuild, or purchase a new home to replace one lost in the disaster.
From the FHA/HUD official site:
“HUD’s Section 203(h) program provides FHA insurance to disaster victims who have lost their homes and are facing the daunting task of rebuilding or buying another home. Borrowers from participating FHA-approved lenders are eligible for 100 percent financing, including closing costs”.
Another program, the 203(k) rehabilitation loan, “enables those who have lost their homes to finance the purchase or refinance of a house along with its repair through a single mortgage. It also allows homeowners who have damaged houses to finance the rehabilitation of their existing single-family home”.
FHA 203(k) and 203(h) rehab loans can be used together in qualifying circumstances. Borrowers who currently have FHA mortgages are urged to contact their loan officers as soon as possible after a natural disaster to make arrangements, discuss payment options which may include loan forbearance in certain situations.
Even if the home purchased with an FHA loan is currently uninhabitable due to hurricane damage or other issues, it is never safe to assume your mortgage payment requirements have changed. Discuss your situation with the lender to determine next steps and contact FEMA to see what other federal aid you may be eligible to receive.
It is highly likely that more areas will receive designation as federal disaster areas in the wake of Hurricane Irma; we will report on those declarations as they are announced by the Department of Housing and Urban Development.