U. S. Department of Housing and Urban Development
                 Washington, D.C. 20410-8000
 
                       January 28, 1998
 
OFFICE OF THE ASSISTANT SECRETARY
FOR HOUSING-FEDERAL HOUSING COMMISSIONER
 
                                                  TI-463
 
TO:   ALL APPROVED TITLE I LENDERS
 
SUBJECT:     Special Title I Assistance to Victims in
Presidentially Declared Major Disaster Areas - North
Carolina, Vermont, New Hampshire and an Additional County
added to the New York Declaration
 
     This Title I Letter is to advise you of recent
Presidential declarations of major disaster areas which
allow you to provide special assistance to current Title I
borrowers in these areas as well as potential borrowers.
These declarations were issued to assist victims of flooding
in North Carolina and of winter storms in Vermont, New
Hampshire and New York.
 
     The President's declaration of a major disaster area
for North Carolina was signed on January 16, 1998 and
includes Avery and Mitchell counties.
 
     The President's declaration of a major disaster area
for Vermont was signed on
January 16, 1998 and includes Addison, Chittenden, Franklin,
Grand Isle, Orange and Windsor counties.
 
     The President's declaration of a major disaster area
for New Hampshire was signed on January 15, 1998 and
includes Belknap, Carroll, Cheshire, Coos, Grafton,
Hillsborough, Merrimack, Strafford and Sullivan counties.
 
     The President's declaration of a major disaster for New
York was signed on January 10, 1998.  TI-461  lists the
individual counties included in this declaration.  On
January 12, 1998, Lewis county was also added to this
declaration.
 
     The following are the special provisions of the Title I
Property Improvement Loan program for borrowers in these
localities:
 
     Existing Title I Loans: Lenders with existing loans in
the above areas are encouraged to use all available
forbearance measures to assist Title I borrowers who have
experienced a loss of income or other financial difficulties
                                                     2
 
resulting from the major disaster.  Section 201.54 of the
Title I regulations was modified in 1996 to provide that the
Secretary may extend the claim filing period if the borrower
has experienced a loss of  income or other financial
difficulties directly attributable to a major disaster
declared by the President, and additional time is needed to
provide forbearance on a property improvement loan.  Accordingly,
the claim filing period for such cases attributable to this
disaster is extended to 12 months.
 
   New Title I Loans: In the case of Title I lenders
accepting new Title I loan applications in these disaster
areas, Section 201.20(b)(3) of the Title I regulations was
modified in 1996 to add a new provision that allows lenders
to approve the use of loan proceeds to pay for emergency
repairs made before final loan approval when the property is
located in a Presidentially declared disaster area.  The
lender must document the loan file that the repair work
needed to be done before the loan was approved.  The most
common reasons are to protect a structure from additional
damage from the elements or to stabilize the structure until
the replacement building materials can be installed.
 
  These provisions apply for one year from the effective
date of each Presidential declaration.  Any areas added to
these declarations will also be eligible for this disaster
relief under the same conditions.  The Department
appreciates any assistance Title I lenders can provide to
victims in these disaster areas.
 
   If you have any questions about this letter, please
write to Maurice D. Gulledge, Chief, Home Improvement
Insurance Branch, 451 Seventh Street, S.W., Room 9272,
Washington, D.C. 20410, or contact the branch at 202-708-6396
or eMail to homeimpr@hud.gov.
 
                            Sincerely,
 
                            Nicolas P. Retsinas
                            Assistant Secretary for
                              Housing-
                            Federal Housing Commissioner