U. S. Department of Housing and Urban Development
                  Washington, D.C. 20410-8000
                         March 26, 1998
 
OFFICE OF THE ASSISTANT SECRETARY
FOR HOUSING-FEDERAL HOUSING COMMISSIONER
 
                                                        TI- 465
 
TO: ALL APPROVED TITLE I LENDERS
 
SUBJECT:  Special Title I Assistance to Victims in Presidentially
          Declared Major Disaster Areas - Delaware, Florida and
          Additional Counties Added to the Previous California
          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 winter storms in Delaware, of tornadoes and
violent weather in Florida, and of flooding in California.
 
    The President's declaration of a major disaster area for
Delaware was signed on February 13, 1998 and includes Sussex county.
 
    The President's declaration of a major disaster area for
Florida was signed on February 12, 1998, February 23rd 1998 and
February 25th 1998.  The February 12th 1998 includes Broward,
Dade and Monroe counties.  The February 23rd 1998 declaration
includes Brevard, Clay and Manatee counties.  The February 25th
declaration includes Alachua, Baker, Bradford, Citrus, Columbia,
DeSoto, Dixie, Duval, Gilchrist, Hamilton, Hardee, Highlands,
Lafayette, Marion, Nassau, Orange, Osceola, Pasco, Pinellas,
Polk, Seminole, Suwannee, Taylor, Union and Volusia counties.  In
addition, new information from the Federal Emergency Management
Agency has indicated that Sumter and Lake counties were
Presidentially declared as major disaster areas on January 14,
1998.
 
    The President's declaration of a major disaster for
California was signed on February 9, 1998.  The twenty-seven
counties eligible for assistance were stated in a previous Title
I Letter.  On February 13, 1998, Amador, Fresno, Sacramento and
Solano counties were added to his declaration.
                              -2-
 
    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 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, DC 20410, or
contact the Branch at 202-708-6396 or email to homeimpr@hud.gov.
 
                              Sincerely,
 
                              Art Agnos
                              Acting Assistant Secretary for
                                Housing-
                                Federal Housing Commissioner