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FHA Mortgage Option For Homeowners Who Lost Their Home To A Natural Disaster

By
Mortgage and Lending with George Souto NMLS #65149 FHA, CHFA, VA Mortgages NMLS #65149

Many homeowners have recently lost their homes  by the  devastating damage caused by Hurricanes Harvey in Texas, and Irma in Florida.  This destruction caused by these hurricane reminded me I should once again post a blog informing homeowners who are victims of a major disaster that there is an FHA Mortgage Option For Homeowners Who Lost Their Home To A Natural Disaster.  

FHA Section 203(h) of the FHA Guidelines addresses "Disaster Victims".  Section 203(h) provides an FHA Mortgage Option For Homeowners Who Lost Their Home To A Natural Disaster, and the President has declared the area they live in a disaster area.  If the Homeowner meets those conditions, they can apply for a new mortgage under the Section 203(h) Mortgage Program for Disaster Victims.

Under Section 203(h) the Borrower's previous home must have been destroyed or damage to such an extent that rebuilding or purchasing a new home is necessary.  Section 203(h) not only applies to Homeowners, but also to renters who were impacted by the lost of their property.

In order to apply for a new Mortgage under Section 203(h) a Homeowner or Renter must provide the following proof:

  • Proof of residency:
    • Valid drivers license
    • voter registration card, or
    • Utility bill
  • Proof of destruction:
    • Insurance Report
    • Inspection Report by an independent Inspector or Government Agency, or
    • Photograph as evidence that the property was destroyed or damaged to the point of that it does not make sense to rebuild it.

Mortgages under Section 203(h) are only available for the following properties:

  • One Unit Detached Properties
  • Approved Condominium Projects

NOTE:  Multi-Family properties are not eligible.

Mortgages under Section 203(h) are:

  • Eligible for 100% financing, so there is no down payment required.
  • Lenders can exclude the present mortgage payment from the Borrower's Debt-To-Income Ratios if the Borrower can show:
    • The property was insured by a sufficient amount to pay off the remaining mortgage balance of the damaged home.
    • The Borrower is working with the Lender servicing the property to address the Borrower's mortgage obligation.

So there is HOPE for homeowners who lose their home because of a natural disaster.  No Homeowner wants to lose their home, but it is good to know there is an FHA Mortgage Option For Homeowners Who Lost Their Home To A Natural Disaster, and can assist them in obtaining a new mortgage to replace the home they lost.

 

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 Info about the author:

George Souto NMLS# 65149 is a Loan Originator who can assist you with all your #FHA, #CHFA, and #Conventional #mortgage needs in Connecticut. George resides in Middlesex County which includes #Middletown, #Middlefield, #Durham, #Cromwell, #Portland, #Higganum, #Haddam, #East Haddam, #Moodus, #Chester, #Deep River, and #Essex. George can be contacted at (860) 573-1308 or gsouto@mccuemortgage.com

Posted by

George Souto
NMLS# 65149

C (860) 573-1308
CALL 7 Days/Wk
Fax (860) 760-6891

Email Me
About Me
My Blog

I am a Mortgage Loan Officer who can assist you with all your mortgage & refinancing needs in
CT, and RI

I can assist you with your Conventional,
FHA, CHFA, VA, USDA, & 203K loan programs.

I reside in Middlesex County which includes Middletown, Middlefield, Durham, Cromwell, Portland, Haddam. E. Haddam, Higganum, Chester, Essex, Deep River.

 

Comments (12)

Lisa Von Domek
Lisa Von Domek Team - Dallas, TX
....Experience Isn't Expensive.... It's Priceless!

Hello George Souto very timely information for all of those affected by those devastating storms.

Sep 17, 2017 04:20 PM
Hannah Williams
HomeStarr Realty - Philadelphia, PA
Expertise NE Philadelphia & Bucks 215-820-3376

George Souto  wonderful information as always for folks who will need assistance  you are the best

Sep 17, 2017 06:14 PM
Endre Barath, Jr.
Berkshire Hathaway HomeServices California Properties - Beverly Hills, CA
Realtor - Los Angeles Home Sales 310.486.1002

George, is this like the 203 K that you can rebuild it? now if there is home owners insurance who will pay for the rebuilding? Endre

Sep 17, 2017 06:28 PM
George Souto

Endre it is not a rehab loan like a 203K.  The advantages to this loan option is that the Borrower is eligible for 100% financing (no down payment), and the Lender does not have to include the existing mortgage in the Debt-To-Income Ratios, so the DTI is much lower.

Sep 18, 2017 07:47 AM
Nina Hollander, Broker
Coldwell Banker Realty - Charlotte, NC
Your Greater Charlotte Realtor

Good morning, George... this is very valuable information to repeat after the recent disasters. I know that many people are simply not aware of their options.

Sep 18, 2017 03:34 AM
Gabe Sanders
Real Estate of Florida specializing in Martin County Residential Homes, Condos and Land Sales - Stuart, FL
Stuart Florida Real Estate

Thanks for this timely post and information, George.  I'm saving this in case anyone around here needs this info.

Sep 18, 2017 06:52 AM
Grant Schneider
Performance Development Strategies - Armonk, NY
Your Coach Helping You Create Successful Outcomes

Good afternoon George - there is light at the end of the tunnel.  As always all the steps must be followed so they need to contact a person like you who is qualified in putting through FHA section 203(h) mortgages.

Sep 18, 2017 02:03 PM
Debe Maxwell, CRS
Savvy + Company (704) 491-3310 - Charlotte, NC
The RIGHT CHARLOTTE REALTOR!

What a wonderful program, George! Thinking that if the home was 100% demolished, most of their belongings had to have been as well. The 100% financing option allows them to spend that downpayment money on the necessities inside the home.

Thanks for sharing this great information - I'm sure there will be many who benefit from this.

Sep 21, 2017 06:42 PM
Kat Palmiotti
eXp Commercial, Referral Divison - Kalispell, MT
Helping your Montana dreams take root

It's good for people in this situation to know there are some options, should they choose to use them.

Sep 23, 2017 03:42 AM
Jeff Dowler, CRS
eXp Realty of California, Inc. - Carlsbad, CA
The Southern California Relocation Dude

Hi George

Such a difficult time for so many. I bet there are plenty of people who could benefit from this information and will appreciate knowing help is available.

Jeff

Sep 23, 2017 08:03 AM
Gita Bantwal
RE/MAX Centre Realtors - Warwick, PA
REALTOR,ABR,CRS,SRES,GRI - Bucks County & Philadel

This is good information for home owners affected by the hurricane. Thank you for sharing.

Sep 29, 2017 03:54 AM
Roy Kelley
Retired - Gaithersburg, MD

This is a timely topic and great advice to share with impacted families.

Sadly, many flood victims did not have flood insurance.

Sep 29, 2017 05:29 AM