HUD Publishes Guidance for Originating/Servicing Loans in Disaster Areas

HUD Publishes Guidance for Originating/Servicing Loans in Disaster Areas

In the wake of the devastating wildfires in Maui, HI, the Federal Housing Administration published FHA Info #2023-67 as a reminder to mortgagees about its guidance for originating and/or servicing FHA-insured forward mortgages and Home Equity Conversion Mortgages in locations where the President has declared a major disaster area.

“Mortgagees are reminded to contact affected borrowers who may require loss mitigation assistance as soon as possible post-disaster and FHA encourages mortgagees to use any permissible means to contact borrowers to provide them with needed forbearance relief,” says FHA Info #2023-67.

For existing HECMs, FHA Info #2023-67 says:

  • HECMs that become due and payable for reasons other than the death of the last surviving borrower and eligible non-borrowing spouse are subject to a 90-day extension of HECM foreclosure timelines; and
  • FHA provides HECM mortgagees an automatic 90-day extension from the date of the Presidentially-Declared Major Disaster Area (PDMDA) foreclosure extension expiration date to commence or recommence a foreclosure action.

All properties with pending mortgages or endorsements in PDMDA areas must have a damage inspection report that identifies and quantifies any dwelling damage.

If you’re contacted by a former client who needs assistance, please have them contact their servicer immediately. The Consumer Financial Protection Bureau has also created a useful resource guide that helps explain the obligations of a reverse mortgage borrower while recovering from a natural disaster. Download a copy from