Home Foreclosures on Hold in Disaster Areas
Homeowners will get a 90-day reprieve from foreclosure proceedings
Marcus Yam / Los Angeles Times/Getty Images
Federally backed mortgages on homes hit by Harvey will receive temporary reprieves from foreclosure.
En español | Texans with federally backed mortgages who were already at risk of losing their homes for financial reasons before Hurricane Harvey struck will get at least a temporary reprieve from foreclosure.
The Department of Housing and Urban Development announced that it is granting a 90-day moratorium on foreclosures on loans insured by the Federal Housing Administration (FHA) for people in the counties that have been declared disaster areas due to Hurricane Harvey. The department estimates that about 200,000 homeowners in the affected counties have FHA loans.
“As FEMA begins to assess the damage and respond to the immediate needs of residents, HUD will be there to offer assistance and support the longer-term housing recovery efforts,” HUD Secretary Ben Carson said.
Mortgage giants Fannie Mae and Freddie Mac also announced this week that they will institute 90-day suspensions of foreclosures and evictions for homeowners in the disaster areas with mortgages backed by these agencies. Fannie Mae and Freddie Mac guarantee an estimated 200,000 homes in these areas.
The Veterans Administration meanwhile is encouraging holders of VA home loans to establish a similar 90-day moratorium on initiating new foreclosures in the affected disaster areas.
Texans who have lost their homes due to damage from Harvey could also be eligible for special disaster assistance from HUD to finance the purchase, refinance or repair of a house. HUD also offers FHA mortgage insurance to disaster victims who are looking to rebuild their homes or buy new ones.