If you own a home in New Jersey or New York you may qualify for foreclosure relief after Hurricane Sandy if you have an FHA, Fannie Mae, Freddie Mac, or Veteran's Affairs (VA) loan. Read on to learn out more about available foreclosure relief for these types of loans and how to determine if your loan is an FHA, Fannie Mae, Freddie Mac, or VA loan.
A few states have moratorium laws that prevent a lender from foreclosing after a natural disaster. Generally, once the governor has declared an emergency, those laws go into effect and prevent the lender from either initiating or pursuing a foreclosure against homes affected by natural disasters for a set period of time. Unfortunately, neither New Jersey nor New York has a state law that provides a moratorium on foreclosure during times of natural disaster, such as Hurricane Sandy.
However, if you have a certain type of loan, you may be entitled to relief anyway.
The U.S. Department of Housing and Urban Development (HUD) has provided a 90-day moratorium on foreclosures of FHA-insured home mortgages following Hurricane Sandy, as long as:
If your property wasn't directly affected by the disaster, but Sandy did affect your financial viability, your mortgage might qualify for the moratorium. However, you'll have to provide evidence that demonstrates the hurricane's negative financial impact on you.
FHA lenders must stop all foreclosure actions against borrowers who are delinquent on their home loans. However, just to be safe, you should notify your lender if Hurricane Sandy affected you.
The foreclosure moratorium applies only to borrowers who are delinquent on their FHA loan. If you are current on your loan payments or at risk of defaulting on payments, but have not yet missed a payment, the moratorium does not apply to your situation.
However, if your inability to pay your loan resulted from the disaster, your lender may waive any late fees normally charged and let you know about other options such as:
Contact your loan servicer to find out about these and other types of relief available to victims of Hurricane Sandy.
There are several easy ways to find out if your loan is FHA-insured:
For more information, go to http://portal.hud.gov. Click on “Learn More” under “Hurricane Sandy Recovery.” You can also contact a HUD-approved counseling agency toll free at (800) 569-4287 or call HUD’s National Servicing Center at (888) 297-8685 if you have further questions.
Fannie Mae has implemented a 90-day foreclosure sale suspension and a 90-day eviction suspension for properties located within FEMA designated disaster areas. Find out if you are in a FEMA designated disaster area at www.fema.gov/disasters.
Servicers of Fannie Mae loans are offering special options for those impacted by Hurricane Sandy (or other natural disasters). For example, eligible homeowners with a Fannie Mae loan who are having difficulty paying their mortgage may qualify for a:
Go to http://knowyouroptions.com to learn more about Fannie Mae’s Hurricane Sandy relief. To find out if Fannie Mae owns your loan, click on “Loan Lookup” in the upper-right corner.
If you have a Freddie Mac loan, foreclosure sales and evictions within FEMA designated disaster areas have been suspended for 90 days. You may also qualify for options such as:
Additionally, if your ability to make mortgage payments was affected by Hurricane Sandy, Freddie Mac is:
For more information on relief available for Freddie Mac loans, go to www.freddiemac.com and choose the “Hurricane Sandy Relief” link. To find out if Freddie Mac owns your loan, go to https://ww3.freddiemac.com/corporate.
There is no required foreclosure moratorium for VA loans, though the VA has encouraged loan holders and servicers to:
Ultimately though, the loan holder is responsible for determining when to initiate or continue a foreclosure.
You can go to www.va.gov and search for “Hurricane Sandy” to find related articles pertaining to VA loans.
In January, FHA, Fannie Mae, and Freddie Mac extended their moratoriums through April 30, 2013.
To learn more about any of the options discussed in this article, contact your mortgage loan servicer. Tell them about your current situation and ask about possible options for mortgage relief. The telephone number for your loan servicer can be found on your monthly statement.