HUD Mandates Relief, Creates Toll-Free Line

The Department of Housing and Urban Development is instructing all lenders approved by the Federal Housing Administration to provide foreclosure relief to FHA-insured families affected by Hurricane Katrina, and has established a single toll-free number to assist hurricane victims.HUD Secretary Alphonso Jackson said the relief includes a 90-day moratorium on all foreclosure of FHA-insured properties in the presidentially declared disaster areas. Mr. Jackson is also encouraging lenders to undertake actions such as mortgage modification, refinancing, and waiver of late charges. HUD is contacting top mortgage lenders about their inventory of repossessed homes, the homebuilding industry for help with building materials and supplying construction workers, its housing counseling network to assist displaced homeowners, and the manufactured housing industry about available housing stock. HUD said it will identify vacant multifamily housing, public housing units, and HUD-owned homes that could be used as temporary housing for those forced from their homes. The department has a special mortgage insurance program under the National Housing Act to assist disaster victims, which allows for reconstruction or replacement of homes, and borrowers are eligible for 100% financing. The new toll-free number, 1-888-297-8685, was established to streamline assistance, which was previously available via separate numbers for each different service offered by HUD.