Homeowners may have a solid home and insurance to protect themselves and their property, but when a natural disaster occurs, there are so many facets that are out of homeowner’s control. The damage not only affects properties, but it also affects food, gas, employment, income, internet, phone, transportation, and mail services. After a hurricane, the amount of help from other people, government, churches, and other organizations is amazing. In addition to those providing food and other services, there are hurricane recovery options for homeowners.
Hurricane recovery services include payment forbearance, foreclosure suspensions, repair assistance, unemployment assistance, and more. In this article, we want to pass along some of the options available to homeowners including:
- VA Loan recovery relief
- USDA borrower relief
- Relief for homeowners with FHA loans
- FEMA Assistance
- NC Housing Finance Agency: foreclosure prevention and home repairs
- Insurance claims
Although these are not all of the hurricane recovery options, we hope that this provides much-needed help in the lives of those affected by Hurricane Florence and other disasters.
Hurricane Recovery Relief for Veterans
The Department of Veteran Affairs has a long history of protecting Veterans in many ways. Once a hurricane has affected an area, VA is no different. VA recommends “Mortgage servicers and borrowers alike should review VA’s guidance on natural disasters to ensure Veterans receive the assistance they need.” Below are possible options for borrowers and VA loan servicers.
VA encourages VA loan servicers to extend a forbearance to help Veteran homeowners. It is left up to the mortgage servicer to determine if the hardship is a result of the disaster. A possible solution includes reapplying prepayments for curing a default. Plus, VA allows the loan terms to be modified without approval by Veteran Affairs.
Moratorium on Foreclosure
Although it is left up to the VA loan servicer whether to foreclose or not, VA has requested that lenders establish a 90-day moratorium for any new foreclosures. This is for properties within the disaster area.
Late Charge Waivers
During a disaster and even the hurricane recovery, ways of making payments are affected. These include loss of income, internet, and mail delivery services. Even though many lenders already offer late fee waivers, VA encourages all services to do the same.
In order to prevent damaging a Veteran’s credit report during or recently after a disaster, VA encourages servicers to suspend credit reporting. Services will not be penalized by the VA for not reporting during this period. Therefore it is easier for lenders to provide Veterans a much-needed break if needed.
Activation of National Guard
In times of disaster, the National Guard always rises to the occasion to help those in need. If a National Guard service member is called to active duty, VA encourages servicers to provide a forbearance to borrowers.
As you can tell, many of these statements mention the word “encourages.” Most of these are not requirements and each lender is different. If a Veteran feels there is further assistance needed, reach out to your nearest VA office. Source: VA circular 26-18-18 Special Relief Following Hurricane Florence (9/18/18)
Hurricane Recovery Relief for USDA Borrowers
USDA Rural Development announced relief measures which USDA mortgage servicers may offer to borrowers affected by a natural disaster. Each USDA borrower affected by a disaster may be eligible for temporary relief. Although USDA may require a property inspection for such relief. There are several relief options servicers are able to offer USDA borrowers.
USDA Rural Development encourages lenders to provide forbearance alternatives to borrowers directly affected by hurricanes. Although, USDA requires servicers to verify the hardship is a direct result of the disaster.
USDA requires that loan servicers place a 90-day suspension of foreclosures beginning with the date the President declared the disaster. This suspension includes new and in process foreclosures.
Hurricane Recovery Disaster Assistance for FHA Homeowners
If your home was affected by Hurricane Florence or another disaster, you may qualify for assistance through the US Department of Housing and Urban Development.
HUD has instructed lenders in the following ways:
- Any loss mitigation assistance to help homeowners retain their home are explored
- Lenders may enter into a forbearance plan or offer a modification so borrowers can keep their home and make payments.
- If saving the home is not feasible, lenders may offer a pre-foreclosure sales program or accept a deed in lieu of foreclosure.
Recommended Steps for Homeowners with an FHA Loan
- Contact FEMA to begin the application process (see below).
- Contact your insurance company to file a claim asap, but do not make a hasty settlement.
- Have your home inspected for structural damage. Also, get 2 estimates and use licensed and insured professionals.
- Notify your post office if mail cannot be delivered to your home.
- Communicate with your lender and insurance company often.
- Document all conversations and paperwork
FEMA has a huge job during disasters and at about any time of the year, they are helping those in need at some part of the United States. Hurricane recovery is probably their largest time of need because of the mass flooding. FEMA encourages homeowners to contact them immediately. Plus, get your FEMA number ASAP as it is needed for everything FEMA related. Click here to begin FEMA application or call 1-800-621-3362.
NC Housing Finance Agency Assistance
During good times and tough times, the NCHFA provides NC residents with affordable home loans, foreclosure assistance, and many other services. In the case of hurricane recovery, several options could be helpful through NCHFA. Even if they do not have a program that fits your scenario, they are one of the best resources NC residents have. They could refer you to someone that may be able to help.
- NC Foreclosure Prevention Fund: Although, after a disaster, many lenders offer a suspension of foreclosures, there may be a further need. NCHFA offers assistance while homeowners look for work or complete job training. Learn more here.
Homeowners Insurance and Flood Insurance Claims
Even in cases of flood, contact your homeowner’s insurance company as well. There are cases where the homeowner’s policy will cover certain items including loss of use. In general, flood insurance covers rising water and homeowners insurance covers other damage from falling rain or wind. Although, some coastal areas require separate wind & hail coverage in addition to a homeowners policy, but contact your agencies immediately. Keep your paperwork, phone numbers, policy numbers, and notes of conversations.
Consumer reminder: Be careful not to make a hasty settlement!
File for Disaster Assistance
Anyone in a federally declared disaster area may apply for assistance. To determine possible benefits, visit www.DisasterAssistance.com to look up your area. If your area is affected, you can then apply online for assistance at the same site.
Rental Assistance While Displaced
If during the hurricane recovery, you are unable to occupy your current home, rental assistance may be available. Both FEMA and the SBA provide rental assistance to temporarily live somewhere while unable to occupy your residence. Even though the SBA is primarily for businesses, they offer assistance to renters and homeowners. The SBA loans offer up to $40,000 to repair or replace clothing, cars, furniture, or appliances damaged from the disaster. Furthermore, the SBA may provide up to $200,000 towards the repair or replacement of a home. The terms are very favorable as well.
Notify Your Creditors
Contact your bill collectors if your life has been affected by a disaster. Many creditors are already aware, but it best to be proactive. Most companies will delay due dates, provide a forbearance, or other assistance.
Beware of Scams
Regretfully, hurricane recovery also comes with price gouging and scams. Preying on those when they are weakest and need help is prevalent. Keep in mind, that although help may be severely necessary, check the credentials of providers. For instance, there are ways to verify licenses for contractors. In NC, residents may refer to www.ncbeec.com or call 919-733-9042 before signing a contract.
Don’t forget other local government or nonprofit services offering assistance which include many of the following:
- Unemployment assistance – NC Division of Employment Security
- Churches offering food and clothing
- Local Emergency Management organizations
- Local businesses offering discounts to the community
- Mortgage Bankers Association Relief Brochure
Renovation Loan Options for Repairing Hurricane Damage
First of all, make sure you are safe and have explored your options we have discussed above. If you want to discuss home renovations for a purchase or a refinance, please contact us.
- VA Renovation: Veterans can purchase or refinance including renovations up to 100% of the as completed home value.
- Fannie Mae Homestyle Renovation: Purchase or refinance plus improvements on a primary, secondary, or rental property
- FHA 203k: Purchase or refinance plus improvements with 3.5% down payment
There are many options with OVM Financial’s renovation products, and we will help determine which meets your needs best. Whether it is siding replacement, repairing flood damage, replacing a roof, encapsulating a crawl space, or raising the home, an OVM renovation loan could be your answer.
Even if you are a seller or listing agent who feels a buyer would need a renovation loan to purchase the home, reach out to us. We will help.