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Home Financing for Those in Disaster Areas

U.S. Housing and Urban Development has announced that federal assistance will be provided to those who lost homes located in a FEMA disaster area. This means that those who have lost or had their homes damaged by one of the recent hurricanes, fires or floods are eligible for special $0 down FHA financing. Secretary Carson said, “As FEMA begins to assess the damage and respond to the immediate needs of residents, HUD will be there to offer assistance and support the longer-term housing recovery efforts.”

The following states are currently considered designated disaster areas:


Don’t see your state listed? Call 877-432-5626 for the latest updates on eligibility.

Buyers in these states who have lost their home due to a FEMA designated disaster will be able to purchase a home using an FHA loan for $0 down. Even renters who were affected by the disasters may be able to purchase a home in these states without a down payment requirement.

The 203(h) Loan

The federal government has a loan program in place to assist those affected by natural disasters, called the 203(h) Loan. The 203(h) Loan offers financial assistance for both rebuilding homes and buying new homes. More relaxed than a traditional FHA loan, the 203(h) Loan only requires borrowers to have a credit score of at least 580, and doesn’t require a down payment. The income requirements are more lenient as well.

HUD spokesman Lemar Wooley has said, “FHA also relaxes employment and income requirements for disaster victims who may be forced to obtain new employment, temporary employment or who have lost employment documentation in the disaster.”

Please note: The credit score requirement changes from one mortgage broker/lender to another. FedHome Loan Centers only has a credit score requirement of 580.

Features and Highlights of the 203(h) Loan:

  • $636,150 Max Loan Amount (varies by area).
  • 580 FICO Minimum (our minimum fico requirement)
  • 100% Financing
  • 15/30 Yr. Fixed
  • Original home must be located in a Federally Declared Disaster Area (whether owned or rented)
  • Home must have been destroyed or damaged to such an extent that reconstruction or replacement is necessary
  • Borrower must have been permanent resident of a destroyed or substantially damaged residence
  • Home may be purchased anywhere
  • Must submit application within one year of Presidential disaster declaration
  • Borrower must meet all other requirements for FHA qualification
  • Borrowers with existing mortgages on substantially damaged or destroyed property within the disaster area must show those mortgages are paid off or that an insurance claim has been filed.

203(h) Loan Eligible Properties:

  • One-unit detached homes
  • One-unit detached home in a PUD
  • Units in FHA approved condominium projects
  • Property must meet HUD’s Minimum Property Standards and Minimum Property Requirements

Obtain Your Benefits

FedHome Loan Centers can help you with every step of the process in obtaining a 203(h) Loan, and can also provide you with a list of affordable new housing options. Contact FedHome Loan Centers 877-432-5626 today, and speak with a helpful representative about your options.