HUD Announces Foreclosure and Mortgage Help for Hurricane Laura Victims

If you’re a victim of Hurricane Laura and you live in Louisiana, you might be eligible for disaster assistance from the U.S. Department of Housing and Urban Development.

Hurricane Laura ravaged Louisiana after growing into a Category 4 hurricane with 150 mile-per-hour winds. On August 28, 2020, President Trump issued a major disaster declaration for the following parishes in Louisiana: Allen, Beauregard, Calcasieu, Cameron, and Jefferson Davis. This declaration allows the U.S. Department of Housing and Urban Development (HUD) to offer foreclosure relief and other kinds of individual assistance to qualifying families who live in these areas.

Types of Available Disaster Assistance for Victims of Hurricane Laura in Louisiana

In a press release, HUD announced that it would provide the following types of foreclosure and mortgage help to homeowners who’ve been forced from their homes by Hurricane Laura in the designated areas.

Foreclosure Relief

Generally, when borrowers don’t make their mortgage payments, the lender may initiate a foreclosure once the 120-day waiting period under federal law expires. After a natural disaster, though, the government or lender might impose a moratorium to prevent foreclosures from going forward, at least temporarily.

For the parishes covered under the Presidential declaration, HUD set an automatic 90-day moratorium on foreclosures of Federal Housing Administration (FHA)-insured home mortgages. The suspension starts on the federal disaster declaration date, August 28, 2020. To get help or learn more about foreclosure relief, call your loan servicer or FHA’s Resource Center at 800-304-9320.

Mortgage Insurance When Reconstructing or Buying Another Home

Under HUD's Section 203(h) program, the FHA can insure mortgages from qualified lenders to victims of a major disaster who’ve lost their homes and are in the process of rebuilding or buying another home. Borrowers that get loans from participating FHA-approved lenders are eligible for 100% financing, including closing costs.

Mortgage Insurance When Buying or Refinancing and Rehabilitating a Home

HUD's Section 203(k) loan program insures mortgages covering the purchase or refinancing and rehabilitation of a home that’s at least a year old. This program enables homebuyers and homeowners to:

  • finance the purchase (or refinancing) of a house and the cost of its rehabilitation through a single mortgage or
  • finance the rehabilitation of their existing home.

Getting Counseling and Other Help

A HUD-approved housing counselor can provide you with the following, among other things, at no cost:

  • a comprehensive post-disaster assessment and action plan
  • help dealing with your servicer on loan relief options, and
  • assistance with filing Federal Emergency Management Agency (FEMA), insurance, and Small Business Administration (SBA) claims.

FEMA provides financial assistance to federally-declared disaster areas, and the SBA has special loan programs to help individuals and businesses after a natural disaster. To learn more, check out our article on Disaster Loans After a Hurricane, Tornado, or Other Natural Disaster. You can also learn more about assistance for disaster victims on HUD’s Disaster Resources webpage.

Also, even if you have another kind of loan, like a Fannie Mae or VA-guaranteed loan, you might qualify for foreclosure and mortgage help after suffering the effects of a hurricane.

Effective date: August 28, 2020