Pro Bono News

FHA Expands on Foreclosure Relief for 2017 Disaster Victims

Thursday, February 22, 2018

FHA Expands on Foreclosure Relief for 2017 Disaster Victims

"The Federal Housing Administration announced Thursday it is extending its foreclosure relief for the victims of 2017’s natural disasters.

It plans to expand mortgage relief to FHA-insured homeowners who live or work in areas impacted by Hurricanes Harvey, Irma and Maria as well as the California wildfires and subsequent flooding and mudslides.

The FHA is instructing mortgage servicers to offer additional options to disaster victims in Texas, Louisiana, Georgia, Florida, South Carolina, California, Puerto Rico and the U.S. Virgin Islands. The options will allow them to remain in their homes while reducing losses that would have impacted the FHA’s Mutual Mortgage Insurance Fund.

The FHA is introducing its new Disaster Standalone Partial Claim option, which would help struggling borrowers to resume their mortgage payments without a payment shock. The option wraps up to 12 months of missed mortgage payments into an interest-free second loan on the mortgage. The second loan is then payable when the borrower sells their home or refinances..."

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