September 3, 2020
On August 28, 2020, there was a federal major disaster declaration announced for the state of Louisiana; those living in the affected areas are eligible for federal disaster relief and other measures as announced (see below).
The U.S. Department of Housing and Urban Development now offers federal disaster assistance there “to provide support to homeowners and low-income renters displaced from their homes in areas affected by Hurricane Laura.”
The major disaster declaration is for the following parishes in Louisiana; Allen, Beauregard, Calcasieu, Cameron, and Jefferson Davis.
The result of having these areas declared as federal disaster areas allows FHA foreclosure relief and other assistance to impacted families living in these counties to include immediate foreclosure relief in the form of a 90-day moratorium on foreclosing upon any FHA mortgage.
For more information on this moratorium, call your loan servicer or FHA’s Resource Center at 1-800-CALL FHA (1-800-225-5342).
There is also help in the form of the FHA Rehabilitation loan (Section 203(h) program that offers FHA home loans and refinance loans for disaster victims “whose homes were destroyed or damaged to such an extent that reconstruction or replacement is necessary and are facing the daunting task of rebuilding or buying another home”
One of the main benefits of these loans over the long term for these applicants? Section 203(h) borrowers are eligible for 100 percent financing, including closing costs.
This loan can be used in conjunction with a HUD 203(k) Rehabilitation loan program, which the HUD press release reminds, “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”.
Borrowers affected by Hurricane Laura should check the FEMA official site to determine if their area has been declared a federal disaster area. You will also need to contact your loan servicer as soon as possible in the wake of damage to your property.
If you are in danger of missing payments on your mortgage, you should not expect loan modification or other measures to happen automatically–call your lender as soon as possible to make arrangements. Those who have already missed payments should do likewise–the longer you wait, the fewer your options become.
Louisiana residents affected by the disaster should also look at their local resources, and help may be available through the Small Business Administration even for those who do not own small businesses.
Part of the SBA mission includes offering disaster assistance to those who need help even after insurance and other disaster relief have been applied.
Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.
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