Foreclosure Help After a Natural Disaster: FHA and VA Loans

If you have a FHA or VA loan and have gone through a hurricane or another natural disaster, you might qualify for foreclosure relief.

If you’re a homeowner with an FHA or VA loan who’s gone through a hurricane or other natural disaster, you likely qualify for foreclosure relief. Read on to learn out more about the different types of available assistance for homeowners with these types of loans, as well as help for homeowners in general after a natural disaster.

Federal Housing Administration (FHA) Loans

If you've gone through a natural disaster, your mortgage loan is FHA insured, and you meet certain criteria, you’re entitled to a foreclosure moratorium (which means a foreclosure can’t start or proceed) and possibly a foreclosure avoidance option, like a forbearance or loan modification.

Foreclosure Moratoriums

Generally, if you fail to make your mortgage payments, the loan owner may foreclose. In some cases, though, a foreclosure moratorium will prevent this from happening—at least temporarily.

The U.S. Department of Housing and Urban Development (HUD) usually provides a 90-day moratorium on foreclosures of FHA-insured home mortgages following a natural disaster if:

  • the property is within the boundaries of a presidentially-declared disaster area
  • someone from your household is deceased, missing, or injured as a result of the disaster, or
  • your financial ability to make your mortgage payments was directly or substantially affected by the disaster.

HUD also typically extends its 90-day moratorium if the disaster was especially damaging. For example, in the case of homeowners who suffered damage as the result of Hurricane Harvey, Irma, or Maria, HUD granted a 180-day moratorium on foreclosures. Then, HUD extended the moratorium for victims of Hurricane Maria in Puerto Rico and the U.S. Virgin Islands who meet certain criteria until September 15, 2018. After the California wildfires in 2017, HUD granted a 90-day foreclosure moratorium.

The moratorium begins on the date the area is declared a disaster area, and applies to starting a foreclosure as well as foreclosures that have already started.

Forbearances and Loan Modifications

HUD offers loan forbearances and loan modifications to borrowers in disaster-affected areas who are having trouble making their mortgage payments.

Forbearances. You might qualify for one or more periods of reduced or suspended payments.

Modifications. In most cases, you have to occupy your home in order to get a loss mitigation (foreclosure avoidance) option for your FHA loan, but in the case of a presidentially-declared major disaster area, the rules are sometimes different because the home might not be inhabitable.

To qualify for a modification after a natural disaster, the borrower and the property must typically meet the following requirements:

  • the property has to be within a disaster area
  • the home was the borrower’s principal residence immediately before the disaster.
  • the borrower intends to move back in and occupy the home once it is restored to habitable condition, and
  • the total accumulated mortgage arrearages can’t be more than the equivalent of twelve months of PITI (principal, interest, taxes, and insurance).

The borrower generally has to repair the home and occupy the dwelling as an owner-occupant before completing the loan modification.

Disaster Standalone Partial Claim. If you have a FHA-insured loan and fell behind in your mortgage payments because of Hurricane Harvey, Irma, or Maria, or the California wildfires in 2017, you might be eligible for a Disaster Standalone Partial Claim. With this option, FHA wraps up to 12 months of your missed mortgage payments into an interest-free second loan on your home. (To learn more, read FHA Introduces New Foreclosure Avoidance Option for Disaster Victims.)

How to Determine if Your Loan is FHA-Insured

There are several easy ways to find out if your loan is FHA-insured:

  • Look at your mortgage. If there is a HUD case number in the upper-right corner of the first page, then your loan is FHA insured.
  • Look at your monthly mortgage statement, which will include the amount of monthly payment owed, as well as line items for homeowners insurance and mortgage insurance premium (MIP), which is what FHA calls its mortgage insurance. If you’re paying MIP, then you have an FHA-insured loan.
  • Call your loan servicer and ask if your loan is an FHA loan.

Getting Help

If you have an FHA loan and you’re having trouble making your monthly loan payments because of a natural disaster, you should contact your servicer immediately to request assistance. If you aren’t satisfied with your servicer's response, you may call a HUD-approved counseling agency toll free at 800-569-4287 or get in touch with HUD's National Servicing Center.

For more information on assistance for borrowers with FHA loans after a natural disaster, go to the HUD website. Hover over “Resources” and click on ”HUD Disaster Resources.”

Veterans Affairs (VA) Loans

If you have a U.S. Department of Veterans Affairs (VA) loan, you might qualify for a foreclosure moratorium or forbearance after a natural disaster. While the VA doesn’t give specific instructions to loan owners and servicers on these subjects, it encourages them to consider homeowners who’ve gone through a natural disaster for moratoriums and forbearance options.

Foreclosure Moratoriums

The VA generally requests that loan owners and servicers implement a 90-day moratorium on starting new foreclosures after a natural disaster.

Mortgage Forbearances

The VA encourages loan owners and servicers to grant forbearance to borrowers who are struggling to make payments as the result of a natural disaster.

Also, if a member of the National Guard is called to active duty as part of recovery efforts, the VA encourages servicers to extend special forbearance to National Guard members who experience financial difficulties due to their service.

How to Determine if You Have a VA Loan

To find out if you have a VA loan, check your mortgage documents or call your loan servicer.

Getting Help

If you have a VA loan and you were adversely affected by a natural disaster, the VA suggests you take the following steps:

  • contact FEMA (see below)
  • contact your mortgage servicer
  • contact your insurance company and file an insurance claim as soon as possible
  • if you get a monthly benefit check from VA or another source and won’t be able to get mail at your normal address, contact your local post office and VA Regional Office, and
  • contact local offices of the American Legion, Veterans of Foreign Wars, Disabled American Veterans, or other veterans’ organizations to find out if special assistance is available, even if you’re not a member of the organization.

Foreclosure Relief for All Types of Mortgages

The Federal Emergency Management Agency (FEMA) provides assistance to individuals and families who lose their homes due to a Presidentially-declared disaster. Disaster assistance is generally:

To find out if your home is in a disaster area, go to the FEMA website and enter your full address to see if your area has been declared for individual assistance. You may begin the disaster application process online at the website or by calling 800‐621‐3362.

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