HUD No. 08-107
July 15, 2008
HUD ANNOUNCES DISASTER ASSISTANCE FOR MICHIGAN STORM VICTIMS
Foreclosure protection offered to displaced families in 11 counties
WASHINGTON - U.S. Housing and Urban Development Secretary Steve Preston today announced HUD will speed federal disaster assistance to 11 storm-ravaged counties in Michigan and provide support to homeowners and low-income renters forced from their homes following severe storms, tornadoes, and flooding. This assistance includes foreclosure relief for families whose homes are insured through the Federal Housing Administration (FHA) living in Allegan, Barry, Eaton, Ingham, Lake, Manistee, Mason, Missaukee, Osceola, Ottawa, and Wexford Counties (more counties may be added in the coming days/weeks).
Yesterday, President Bush declared these counties eligible for certain disaster assistance. A presidential disaster declaration triggers a variety of federal assistance including grants for temporary housing and home repairs, low-cost loans to cover uninsured property losses, and other programs to help individuals and business owners recover from the effects of the disaster.
"These storms, and the flooding they produced, are tearing people's lives apart and we must offer substantive relief to these families," said Preston. "To speed this recovery, we're calling for a 'foreclosure time-out' to offer FHA-insured families a little breathing room as they confront the rebuilding process."
HUD is granting immediate foreclosure relief - In certain storm and flooded ravaged counties, HUD granted a 90-day moratorium on foreclosures of Federal Housing Administration (FHA)-insured home mortgages and strongly recommended that loan servicers take such actions as special forbearance, loan modification, refinancing, and waiver of late charges.
In addition, HUD is:
- Offering states the ability to re-allocate existing federal resources toward disaster relief - HUD's Community Development Block Grant (CDBG) and HOME programs give the State the flexibility to redirect millions of dollars to address critical needs, including housing and services for tornado victims. HUD is currently contacting State and local officials to explore their needs for streamlining the Department's CDBG and HOME programs in order to expedite the repair and replacement of damaged housing;
- Making mortgage insurance available - HUD's Section 203(h) program provides FHA insurance to disaster victims who have lost their homes and are facing the daunting task of rebuilding or buying another home. Borrowers are eligible for 100 percent financing, including closing costs;
- Making insurance available for both mortgages and home rehabilitation - HUD's Section 203(k) loan program enables those who have lost their homes to finance the purchase or refinance of a house along with its repair through a single mortgage. It also allows homeowners who have damaged houses to finance the rehabilitation of their existing single-family home; and
- Offering Section 108 loan guarantee assistance - HUD will offer state and local governments federally guaranteed loans for housing rehabilitation, economic development and repair of public infrastructure.
HUD is the nation's housing agency committed to increasing homeownership, particularly among minorities; creating affordable housing opportunities for low-income Americans; and supporting the homeless, elderly, people with disabilities and people living with AIDS. The Department also promotes economic and community development and enforces the nation's fair housing laws. More information about HUD and its programs is available on the Internet and espanol.hud.gov.