It’s not a scenario we like to dwell on, but every year Americans face natural disasters that turn their lives upside down. While we can do our best to prepare, often these horrific events are simply out of our control.
Many people survive wildfires, tornadoes, hurricanes and floods only to return to find their homes damaged or destroyed. Although losing a home can be a traumatizing experience, it’s no reason to give up hope. Many Americans have been able to rebuild their lives and their homes with the help of programs offered through The United States Department of Housing and Urban Development.
If a Presidentially declared disaster has affected your home or your ability to make payments on your home, you may be eligible for assistance through a number of federal relief programs. These programs are designed to help qualified borrowers repair or rebuild a damaged home or buy a replacement property.
Rebuilding with FHA Disaster Relief Loan Programs
If your home is located in a disaster area and it has been damaged to the extent that reconstruction or replacement is necessary, our government loan specialists can assess your eligibility for these programs and guide you through every step of the recovery process.
In order to qualify for these disaster relief programs, the borrower’s application must be submitted to the lender within one year of the President’s declaration of the disaster area. To find out if you are eligible for these programs, simply call 877-432-5626 or complete the free application form on this page.
These programs are available to both homeowners and renters seeking disaster relief. Another key feature of these programs is that the new home does not need to be in a disaster area—it can be located anywhere! If your home has been damaged as a result of recent wildfires, tornadoes, hurricanes or floods and you qualify for an FHA loan, you could be eligible for special $0 down financing.
How the Reconstruction Program Works
When an area is officially declared a disaster area by the President, certain programs take effect which make it easier for homeowners to reestablish themselves. One of these programs is the Section 203(h) FHA home loan mortgage insurance program. This insured mortgage can be used to finance the reconstruction of a damaged home or the purchase of a new home. The FHA insures mortgages to qualified disaster victims through this program by protecting lenders against the risk of default.
The Section 203(h) FHA home loan program only requires a minimum credit score of 580 and does not require a down payment. This program has several features that make it very similar to the standard FHA home mortgage program. Like the FHA 203(b), the maximum loan limit for the 203(h) program varies by county. For the exact loan limit in your area, Click here.
The program allows borrowers to choose between a 15 or 30-year fixed-rate mortgage on the following property types: One-unit, single family, detached homes, one-unit detached home in PUD and units in FHA approved condominium projects. Please note that the property must meet HUD’s Minimum Property Standards and Requirement.
How the Repair / Rehab Program Works
Another FHA home loan program available to Americans whose homes have been damaged is the 203(k) Rehabilitation Mortgage Insurance Program. This program allows homeowners to repair, improve or upgrade their home. Damaged residences are eligible for this program regardless of the age of the property, providing the property is located in a Presidentially Declared Major Disaster Area. However, the property must have been completed and ready for occupancy prior to the disaster to be eligible.
Home Improvement with the FHA 203(k) Loan
The FHA 203(k) home loan program is not purely restricted to disaster relief. You can also qualify for a loan through this program and use it to make expensive repairs or modifications to your home, bring your home up to code, install solar or make other improvements to the home’s function. The cost of the rehabilitation must be at least $5,000 and the total value of the property must remain under the FHA mortgage limit for the county. For more information on the home improvement aspect of this FHA loan, Click here.
Ready to Rebuild?
We understand that rebuilding can be an overwhelming process. Let our team of government loan specialists assess your unique situation and guide you through every step of the process. We can even provide you with a list of affordable new housing options!
Federal Home Loan Centers is an approved originator of mortgage loans guaranteed by the US Government. Federal Home Loan Centers is not associated with any government entity.