HUD ANNOUNCES MILLIONS
IN DISASTER ASSISTANCE FOR
NORTH DAKOTA, SOUTH DAKOTA AND MINNESOTA

In announcing the aid, Cuomo authorized the waiver of regulations governing already allocated Community Development Block Grant (CDBG) and HOME Investment Partnership Program funds, allowing the state of North Dakota to use the money to rebuild flood-damaged communities.

"With the massive destruction of property and the temporary loss of jobs caused by the floods, thousands of individuals will experience severe economic and personal hardships," said Cuomo. "The easing of the guidelines that determine how CDBG and HOME funds are to be used, as well as the leeway we're granting to FHA-insured mortgage lenders, will help facilitate the recovery process in a meaningful way."

With the waivers, local officials will be able to use community development grants for new housing construction, the repair or construction of buildings used for the general conduct of government, and the modification of certain relocation requirements.

Regulations suspended under the HOME program include those pertaining to tenant-based rental assistance, matching contribution requirements, maximum per-unit subsidy requirements, and property standards.

The Federal Housing Administration, the government-owned mortgage insurer that is a part of HUD, is making allowances to mitigate the hardships faced by individuals residing in the presidentially declared disaster areas of North Dakota, South Dakota and Minnesota.

A special FHA mortgage program enables eligible buyers to finance 100 percent of the cost of purchasing a home, including closing fees, within one year of the disaster declaration, and requires no downpayment.

In addition, there is an immediate 90-day moratorium on the foreclosure of all FHA-insured mortgages on properties in flood- damaged areas, and lenders are being strongly urged to provide forbearance on FHA-insured home mortgage loans, including refinancing, reamortization and the waiver of late fees.

Similarly, the Government National Mortgage Association, another entity within HUD, is encouraging all single-family, multifamily, and manufactured housing security issuers to provide as much forbearance as possible to homeowners in North Dakota, South Dakota and Minnesota who cannot make their mortgage payments.

In return for their cooperation, Ginnie Mae will make the lenders' payments to the holders of those Ginnie Mae securities through June 1997 if more than five percent of the lenders' loan portfolio is in the affected areas.

"Collectively, the Department is committed to doing all it can to help the families whose lives have been interrupted by the events that have taken place," Cuomo said. "Special programs can't erase the pain and suffering these families have experienced, but they can play an essential role in rebuilding strong, vibrant communities."