Disaster Grants & Loans

How To Get Disaster Relief for FHA Homeowners

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Disaster Relief for FHA Homeowners

How to get home disaster relief assistance for FHA homeowners, this is the current issue for millions of people who have been in disaster struck areas. In the last few years it seems that mother earth is raging. First came Hurricane Katrina then there where terrible snow storms, fires, floods and now Tornadoes twister storms hitting Alabama, North Carolina, Oklahoma, Virginia, Arkansas, Mississippi, Massachusetts and Georgia.

Million of home and houses have suffered some kind of damage, other homes have been completely wiped out leaving millions of American as refugees in their own state. For these nature disasters the government has the FEMA  (Federal Emergency Management Agency) as part of the U.S. Department of Homeland Security.

Another option for relief can be the SBA  (Small Business Administraion) which help out for homeowners and rentals (no need to be a business owner) with low rates disaster loans for housing and personal needs.

FEMA and HUD For Homeowners Disaster Relief

FEMA by its nature is a federal assistance and is supporting four types of eligible applicants for (PA) public assistance:

1. State Government Agencies
2. Local Governments and Special Districts – county, city, village, town, district.
3. Private Non-Profit Organizations – Colleges, schools and universities, hospital, outpatient facility, homes for the elderly, Museums, zoos, community centers, libraries, homeless shelters.
4. Federally recognized Native American Tribes - Indian or Alaskan.

As you can see, private homeowners have no direct assistance from these FEMA public assistance grants and disaster relief assistance. Into this exact needs the HUD (U.S. Department of Housing and Urban Development) fits in and offers assistance for disaster recovery and relief aid for FHA homeowners.

Who Is Eligible For Disaster Relief

The first requirement for a homeowners disaster relief is that the disaster will be declared by the president as a “disaster”. Until such presidential disaster declaration, and no matter how hard the disaster is, the FHA, HUD and FEMA have no legal authorization for accepting applications and processing the relief assistance.

The first advice by HUD to contact your lender and let them know you are in trouble. The disaster relief does not have to be because your house was crushed by a tornado, it is enough that the place where you work at was damaged or closed for you to be in financial stress and be late on your mortgage payments.

Who Is Eligible For Homeowner Relief

By the HUD guidelines, there are four main guidelines to check whether the disaster loans assistance is relevant for you. There are four questions to answer, which will help you know if you are a candidate for relief aid. If you are, then your lender will be able to cancel or deley any forclosure risks for 90 days.

HUD Disaster Relief Question #1 -  Did your income decrease or did your family expenses rise. As the FHA home loan is given according to ‘loan to income ratio’, (back-end ratio) and change in those may mean that the insured loan is at risk.

HUD Disaster Relief Question #2 – Did the rise in expenses or drop in income can be in direct connection to the disaster. If you were fired because your work place shut down with no connection to the disaster, then you are not eligible. If you lost your job because it was wrecked by a storm, or your expenses were raised because your car was crushed by a falling tree.

HUD Disaster Relief Question #3 - What kind of effect did this disaster had on the mortgage payments. If because of these two first questions you have difficulty to stay current on the mortgage, than the relief program is for you.

HUD Disaster Relief Question #4 - What other financial resources do you have? Have you any insurance ? Have you got paid by any insurance settlements? What other financial options and solutions do you have to pull yourself out from the disaster outcomes.

The lenders can delay or cancel initiation of foreclosure for 90 days.

FHA Disaster Relief Requirements

Beyond the above requirements there are a few more FHA requirements to be included in the FHA disaster relief program. Lenders were instructed to allow grace period before going for foreclosure, this moratorium can be for 90 days or a complete cancellation of the foreclosure process. In order to postpone any foreclosure on your FHA home loan, you need to check if you belong to one of these disaster categories. FHA Disaster relief foreclosure moratorium is granted to one of the three options bellow:

1. You or your family live within the geographic boundaries of a Presidentially declared disaster area, you are automatically covered by a 90-day foreclosure moratorium.
2. You are a household member of someone who is deceased, missing or injured directly due to the disaster, you qualify for a moratorium.
3. Your financial ability to pay your mortgage debt was directly or substantially affected by a disaster, you qualify for a moratorium.

The fourth group:

There is another group of people which were not facing foreclosure when the disaster happened they are the fourth group. For many other people, who where current on all their mortgage payments and were not in any foreclosure procedures, these three options above are not relevant. For people who did not miss payments and where on time until the disaster struck, getting a moratorium is not a solution. If you think you belong to the fourth group, you need to contact your lender and let them know your situation, let them know you may be having problems to keep up with the mortgage payments.

The FHA approved lenders where instructed to find financial solutions for people who because of the disaster are having problems to stay current on the mortgage. FHA approved lenders should check and evaluate each mortgage and borrower to find out how it was affected by the disaster, and find reasonable ways to help them through this FHA disaster relief program for homeowners.

FHA Disaster Relief Solution Possibilities

There are several options for solutions, each of the options will be evaluated by the lender and tailored per borrower’s needs. Before applying for the FHA homeowner disaster relief, prepare all the necessary documentation. The FHA and the lender will need to see insurance papers, medical records of injuries, death certificates for disaster victims. Make sure the lenders are aware to your situation and understands that you are in a presidential declared disaster area.

1. Lenders can postpone any extreme action, otherwise they might have choosing to take, such as not referring the late mortgage to foreclosure.

2. Lenders want to help you keep your home, and stay a paying borrower. They will try and search for available loss mitigation assistance. There are several loss mitigation solutions, and the best option will be chosen together with you.

3. In order to assist you stay a homeowner and struggle through, the lenders may look for forbearance plan, or execute a loan modification or a partial claim. This will take place to help the homeowner be able to get the financial issues back on track, and carry on with the new terms safely.

If you have contacted your lender and are no satisfied with the solution or you think there are better options for you within the FHA disaster relief program, do not hesitate and contact HUD-approved counseling agency toll free at (800) 569-4287 or contact HUD’s National Servicing Center.

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1. All About Disaster Area Home and Property Loans

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Disaster Area Home and Personal Property Loans -SBA

Home Loans For Disaster Declared Areas

Many houses, homes and businesses have been devastated by the nature wild behavior. Disasters can be nature made like weather storms, hurricanes and tornadoes, wild fire, floods, snow and mud; and man made disasters like factory accidents that starts a wild fire or huge explosions. The federal government has many disaster declared area grants and loans you may want to learn about and find if you are eligible.

The most famous is FEMA  Federal Emergency Management Agency. But except for these main agency there are several more agencies and organizations which can lend a hand and money for rebuilding the property and giving hope for a better life.

In this review you can learn more about the SBA (U.S Small Business Administration) which has loans and grants for people in disaster struck areas even if they are not business owners. SBA offers homeowner, renter and/or personal-property owner,to apply to the SBA for a loan.

What SBA Disaster Loans Will Be Approved

People who file for a SBA disaster loan application, will need to fill out what are they asking to recover. The Small Business Administration, will approve disaster loans for renters and homeowners alike.

People who have suffered a natural or man mad disaster may borrow up to $40,000; this loan can be used for a variety of needs. As seen at the Katrina Hurricane, and now at the latest Tornadoes the disaster is so extreme thousands or even millions of people are left with nothing but the cloth they were wearing when the disaster has struck.

The SBA disaster loans can be borrowed for any house repair needed, roofs, windows, tiles, doors, electricity, sewage and any other house property that has been damaged and needs to be repaired.

The SBA will approve disaster loans to help people return to pre-disaster condition, by granting loans even for replacing clothing, home furniture, home appliances, electric appliances etc. The loans will be given as a car loan too if needed.

Homeowners SBA Loans For Repair or Replace

People who are home-owners and their property has been damaged or destroyed by the disaster can apply for a loan up to $200,000! This loan is given to help people to repair or replace their primary residence. When a hurricane or a tornado twister destroys a home to the ground, there is a need for a place to rent while the main home is rebuild to its pre-disaster condition.

Since natural disaster are occurring at the same places year after year, the SBA allows the homeowners an additional 20% from the original loan needed, to make construction improvements that will minimize the risk of the same destruction, is similar disaster happens in the future.

Disaster Loans Are Not Approved For

Since the funds are always limited, and many people and homeowners apply for such loans, the loans are only for pre-condition rebuilding and repair. The SBA loans are not approved to upgrade homes or make additions to the houses which may have been effaced by the storms.

If the disaster has struck and destroyed people’s secondary homes or vacation properties, these properties are not approved for the SBA disaster loans.

What Are The Disaster Loans Rates

The SBA understands that in case of disaster people will be left with nothing, and they are hopeless without the loans and aid they get from the state or federal administration. The loans are given to any one who applies and gets approved at the following rates:

• If you have good credit, and can get a loan easily anywhere else, then you rate for the disaster loan will not be above 8%.
• For people with little or no credit options, the loans will not exceed 4% interest rate.

It is not enough to say you do not have a credit anywhere else, the SBA will make its own inquiry to check your creditworthiness and only by its own decision will approve the borrowers the loan and determine the repayment plan.

The disaster loans will be granted for any length of time, and may be returned up to a 30 year repayment plan.

Disaster Area Home Loans

The disaster assistance program of SBA and other federal agencies are permitted only for current Presidential disaster declarations. Only after the president declared an event as disaster only then the SBA, FEMA and other agencies may begin processing applications for grants and loans from these places.