Articles in Category: FHA Disaster Assistance

August 30, 2019

HUD Announces Expanded Disaster Relief Options

The FHA and HUD have announced expanded disaster relief measures for those in federally declared major disaster areas. The changes (see below) must be implemented no later than November 30, 2019 but may be used by lenders right away. The FHA and HUD advise these changes will be reflected in a pending update of the FHA Single-Family Loan Handbook, HUD 4000.1. On Thursday, August 29, 2019, the Federal Housing Administration announced in a press release that the agency is, “expanding its foreclosure prevention options to allow borrowers in Presidentially Declared Major Disaster Areas (PDMDAs) with delinquent FHA-insured mortgages to bring their mortgages current without increasing their interest rates or principal and interest payments.” This is an expansion/enhancement of a temporary measure announced in 2018; Mortgagee Letter 2018-01 “temporarily amended” FHA/HUD | more...

April 12, 2019

HUD Announces Disaster Relief For Iowa and Nebraska Storm Victims

By Joe Wallace

The Department of Housing and Urban Development recently announced disaster relief for victims of storms in Nebraska and Iowa. The agency issued press release stating it would “speed federal disaster assistance “to the State of Iowa and the State of Nebraska to offer “support to homeowners and low-income renters forced from their homes in areas affected by severe storms and flooding”. In March, there was a declaration of a major disaster area for Iowa counties including Fremont, Harrison, Mills, Monona, and Woodbury. There was also a major disaster declaration in March for Nebraska counties including Boone, Buffalo, Butler, Cass, Colfax, Custer, Dodge, Douglas, Knox, Nemaha, Richardson, Santee Indian Reservation, Sarpy, Saunders, Thurston, and Washington. These declarations allow HUD to offer FHA borrowers in the affected areas foreclosure relief in the | more...

October 15, 2018

HUD Announces Disaster Relief For Hurricane Michael Victims In Florida

By Bruce Reichstein

The Department of Housing and Urban Development has announced disaster relief for victims of Hurricane Michael in Florida. According to a HUD press release, the government will “speed federal disaster assistance to the State of Florida and provide support to homeowners and low-income renters forced from their homes due to Hurricane Michael” following a presidential declaration of a major disaster area in several Florida counties including Bay, Franklin, Gulf, Taylor, and Wakulla. The declaration means those living in the affected areas are eligible for a 90-day moratorium on foreclosure on FHA mortgages. To get the benefit of this moratorium borrowers should call their loan officers and contact the FHA Resource Center at 1-800-304-9320. Never assume it is safe to simply stop making payments on an FHA mortgage after a natural | more...

October 11, 2018

FHA Loan Rules For Presidentially-Declared Major Disaster Areas

By Bruce Reichstein

In September of 2018, the FHA and HUD issued a reminder to lenders and FHA loan servicers regarding official policy for dealing with loans in presidentially-declared major disaster areas. A document labelled FHA INFO #18-40 states that for both forward loans and FHA reverse mortgage loans, certain guidance applies once the federal disaster area declaration has been made. The guidance begins with a definition of the disaster area declaration, explaining that it is made when “natural or other events are of such severity that it is beyond the combined capabilities of state and local governments to respond”. When this is invoked by the president, FHA loan guidance to participating lenders includes the following: FHA Loan Foreclosure Moratorium FHA loan rules include a 90-day moratorium on foreclosures following the declaration of | more...

September 14, 2018

FHA Rehab Home Loans For Disaster Victims

By Bruce Reichstein

Those living in federally-declared major disaster areas may be eligible for an FHA home loan to replace or repair properties that have been damaged by the disaster such as a hurricane, floods, etc. FHA 203(h) rehab loans are designed specifically for this purpose-the 203(h) disaster loan features no down payment, an FHA FICO score requirement of 500 or higher, and the rehab loan can only be used for principal residences only. That means owner-occupiers only. How does the FHA 203(h) rehab loan work? HUD 4000.1 has the rules for this type of mortgage loan. The FHA 203(h) rehab loan is quite similar to the FHA 203(k) rehab loan which is available to any financially qualified borrower who meets FHA occupancy requirements for the home. FHA rehab loans allow funds to | more...

August 29, 2018

HUD Announces Updated Disaster Policy For Puerto Rico And Virgin Islands Home Owners

By Joe Wallace

In 2017, Hurricanes Irma and Maria devastated many U.S. territories; in the aftermath home owners in Puerto Rico and the Virgin Islands many people are still recovering from the disaster. In August 2018 the Federal Housing Administration (FHA) has announced updates to FHA foreclosure prevention options to allow borrowers with delinquent FHA home loans “easier access to bring their mortgages current without increasing their interest rates or monthly payments” according to HUD.gov. The Federal Housing Administration is also offering a final 30-day extension of its foreclosure moratorium for FHA-insured homeowners in Puerto Rico and the U.S. Virgin Islands. In February 2018, FHA introduced the Disaster Standalone Partial Claim option, intended to help borrowers in the affected disaster areas a way to catch up on pre-disaster mortgage payments without experiencing “payment | more...

March 15, 2018

HUD Announces Additional Hurricane Recovery Efforts In Houston

By Bruce Reichstein

The Department of Housing and Urban Development has announced a Fair Housing agreement with the City Of Houston designed to enhance hurricane recovery efforts there. According to a press release at the FHA/HUD official site, HUD and the city reached, “a joint agreement designed to expand housing choice and mobility for lower income residents, including those experiencing homelessness and victims of Hurricane Harvey.” The agreement includes a new requirement for the City of Houston to adopt “multifamily priorities and a policy for objectively evaluating federally supported affordable housing developments in all areas of Houston; to seek to invest additional funds in homeless assistance programs, and; to encourage more landlord participation in Houston’s housing voucher program”. “Today, we announce a positive agreement that works to expand housing options for lower income | more...

Coronavirus And Home Loan Appraisals: What You Need To Know Now

March 7, 2018

Help For Spanish-Speaking HomeOwners In Federal Disaster Areas

By Joe Wallace

Homeowners in federally-declared disaster areas are still working to recover homes, property, and personal lives after the hurricanes, mudslides, fires, and other natural disasters in recent times. Efforts by the federal government including the FHA and FEMA are ongoing. Home owners-including FHA borrowers-have a range of options open to them including FHA loan foreclosure avoidance, loan forbearance, even the addition of a partial claim procedure to help FHA borrowers avoid payment shock as they resume pre-disaster FHA home loan payments. Some of these programs are well-known in the disaster areas they serve. But what might not be so well known? The fact that information about these programs is available in Spanish. The FHA/HUD official site includes information in Spanish about disaster relief options. The publication, “Información Importante Sobre Recuperación Ante | more...

March 2, 2018

FHA Foreclosure Relief For 2017 Disaster Victims

By Bruce Reichstein

In late February 2018, the FHA announced additional foreclosure relief measures for victims in federally declared disaster areas in 2017. According to the FHA official site, the new measures are intended to be an expanded version of “mortgage relief to FHA-insured homeowners who live or work in areas impacted by Hurricanes Harvey, Irma and Maria as well as California wildfires and subsequent flooding and mudslides.” The FHA has ordered participating FHA lenders to offer “additional options to eligible disaster victims in Texas, Louisiana, Georgia, Florida, South Carolina, California, Puerto Rico and the U.S. Virgin Islands, allowing them to remain in their homes while reducing losses that would otherwise negatively impact FHA’s Mutual Mortgage Insurance Fund” according to the press release. At the heart of these new measures is something called | more...

February 23, 2018

FHA Announces Foreclosure Avoidance Help For Federal Disaster Areas

By Joe Wallace

The FHA has announced extended foreclosure relief measures for those in qualifying federal disaster areas. According to a press release on the FHA official site, new guidance for participating FHA lenders will apply for those affected by a wide range of natural disasters including: Louisiana (Hurricane Harvey) DR-4345 Texas (Hurricane Harvey) DR-4332 Florida (Hurricane Irma) DR-4337 Georgia (Hurricane Irma) DR-4338 Puerto Rico (Hurricane Irma) DR-4336 South Carolina (Hurricane Irma) DR-4346 Virgin Islands (Hurricane Irma) DR-4335 Puerto Rico (Hurricane Maria) DR-4339 Virgin Islands (Hurricane Maria) DR-4340 California (Wildfires) DR-4344 or California (Wildfires, Flooding, Mud Flows, Debris Flows) FEMA-DR-4353 There is a lengthy description of some of the new program changes (which we will cover in another blog post) but one of the most important developments included in the FHA announcement has | more...