HUD Assistance for Disaster Recovery

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HUD offers disaster relief and recovery assistance.

Mortgage Assistance from HUD's Federal Housing Administration (FHA)

For a Presidentially declared disaster, FHA activates a Mortgagee Letter, "Single Family Loan Production and Servicing - Special Program, Underwriting, and Servicing Policies to Assist Victims of Presidentially-Declared Major Disaster Areas" which:

	Makes available mortgage insurance for disaster victims under the Section 203(h) special mortgage insurance program. This program provides 100 percent financing, with no down payment requirement, for individuals and families whose homes were destroyed or substantially damaged.
	Makes available Section 203(k) rehabilitation mortgages regardless of the age of the property (waiving the one-year requirement).
	Allows mortgagors whose homes are completely destroyed to qualify for a new FHA-insured mortgage loan without consideration of the existing mortgage payments. This allows a higher loan to value ratio and allows the home owner to begin the mortgage application process while insurance settlements are being processed. The mortgagor must satisfy existing debt prior to approval of any new mortgage debt. Disaster victims with Secretary-held properties may be eligible for new FHA-insured mortgages.
	Extends the time for lenders on submission of closed loans from 60 days to 90 days after the date of closing.
	Places a 90-day moratorium on foreclosures (both initiation of foreclosures and foreclosures in process) for properties directly affected by the disaster.

HUD "strongly recommends" servicing actions for homeowners whose properties were directly affected by the disaster. This includes such actions as: special forbearance, mortgage modification, refinancing, and waiver of late charges.

Copies of Mortgagee Letters are available through HUD's web site.

Assistance from the Government National Mortgage Association (GNMA or Ginnie Mae)

For a Presidentially declared disaster, Ginnie Mae issues an All Participant Memorandum, "Forbearance and Buyout Authorization for Loans in Areas Declared a Disaster by President...", which:

Encourages all single-family, manufactured housing, and multifamily Ginnie Mae issuers to provide as much forbearance as possible to mortgagors in areas receiving a Presidential disaster declaration; and

Authorizes issuers of Ginnie Mae pools containing loans on properties damaged by the Presidentially declared disaster to buy loans out of the pools for the remaining principal balance of each loan, regardless of whether the loans are delinquent before such repurchase. This new authority should assist homeowners, whose homes have been directly damaged by the storms and tornadoes, avoid becoming delinquent on their loan payments which can lead to default and foreclosure. Issuers must request written permission to buy such loans out of existing pools.

Copies of All Participant Memoranda are available through HUD's web site or at Ginnie Mae.

Assistance for Public and Indian Housing

Public housing authorities may reprogram Comprehensive Grant Program (Comp Grant) or older modernization programs' funds to address damage to public housing property caused by the disaster. HUD will expedite requests for reprogramming from smaller public housing authorities which receive Comprehensive Improvement Assistance Program (CIAP) funds.

For disaster recovery costs not covered by insurance or other Federal assistance (e.g., the Federal Emergency Management Agency's public assistance program), public housing authorities may contact the local HUD public housing office to request funds from the Reserve for Emergencies and Disasters. (See 24 CFR '968.104(b).)

Community Development and Housing Assistance through Cities, Counties and States

Grantees (metropolitan cities, urban counties and states) may request that awarding of annual Community Development Block Grant (CDBG) and HOME Investment Partnerships (HOME) funds be expedited or that program year start dates be moved up. Grantees may reprogram funds for disaster recovery activities.

HUD may provide statutory (for Presidentially declared disasters) and regulatory waivers in the CDBG and HOME programs to increase the flexibility and the effectiveness of using funds for disaster recovery.

Fact Sheet available on Using Community Development Block Grant and (CDBG) and HOME Investment Partnerships (HOME) Funds for Disaster Recovery; call your local HUD CPD Office or (202) 708-3587 x4538.