The U.S. Department of Housing and Urban Development (HUD) has announced a series of additional measures to help homeowners impacted by Hurricane Sandy avoid the prospect of foreclosure.
In addition to relief offered through HUD's Loss Mitigation Program, the Federal Housing Administration (FHA) is expanding forbearance relief for affected borrowers. Under this expanded policy, borrowers may suspend up to 12 months' worth of mortgage payments while they repair their homes. After the forbearance period, borrowers may be eligible for an FHA streamlined loan modification to avoid large lump sum payments.
According to HUD, up to 285,922 borrowers in the Sandy-affected areas who were eligible for forbearance relief as of Feb. 28 may be eligible for an FHA streamlined modification. This new loss mitigation option aligns with efforts by Fannie Mae and Freddie Mac to provide borrowers coming out of forbearance a streamlined loan modification that will not require a financial assessment.Â
‘As we work to rebuild entire neighborhoods, we can't forget that homeowners need some breathing room as they put their lives back together,’ says HUD Secretary Shaun Donovan, who is also chairman of the federal Hurricane Sandy Rebuilding Task Force. ‘We recognize that families need relief, and by offering expanded forbearance and streamlined loan modifications, FHA is working to provide homeowners with an affordable and permanent mortgage solution.’