Is Your Home Eligible for FHA Disaster Relief
Such declarations, issued by the President of the United States, make those areas eligible for immediate foreclosure relief on federally-backed mortgages such as FHA home loans.
And there are FHA rehab loans especially for those in federal disaster areas that can help you replace a home destroyed in the disaster, or repair one damaged by it. But how do you know if you qualify for the relief?
The first thing you’ll need to do in the wake of a natural disaster is to contact your loan officer to discuss the state of your property and the mortgage. If you anticipate having trouble making your next home loan payments, you’ll want to work an arrangement out with your lender to avoid loan default.
Don’t assume your mortgage payments are not due unless your mortgage lender has specifically told you otherwise; that is one reason why it is recommended to talk to your loan servicer immediately. Contact your lender even if your home is completely uninhabitable or totally untouched by the disaster.
The real question in cases of the latter--how do you know it’s undamaged until it has been inspected? Depending on the disaster, that could be a serious factor. An earthquake might damage parts of the home you cannot detect without the help of a professional.
You’ll also need to know whether your area has been named a federal disaster area. This process may take some time--it does not always happen immediately after the incident(s) so expect delays.
You can check the status of your county by going to the FEMA official site. You may also contact the FHA directly to learn more at 1-800 CALL FHA. Mention that you are trying to see if your area has been named a Presidentially-Declared Disaster Area or if that is anticipated in the future.
If you were in the middle of buying a home but have not yet closed the deal and disaster strikes, the first priority may be ascertaining whether the property still exists, is undamaged, or what the extent of the damage is.
You’ll need to work with the lender to determine whether to move forward with the mortgage loan or not. If you recently applied for an FHA 203(k) Rehabilitation mortgage to buy and renovate a property, you may be eligible for additional FHA loan options via the FHA 203(h) Rehabilitation Mortgage or Refinance for those in federally declared disaster areas.
It’s also helpful to view the disaster resource pages of HUD and the Small Business Administration or SBA. Some people think they would not qualify for SBA assistance, but there are SBA programs for people in federally-declared disaster areas. You may be surprised to learn what options are open to you from these agencies.
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