Obtaining Mortgage Relief for Victims of Disasters

Obtaining Mortgage Relief for Victims of Disasters

This report contains outdated information due to subsequent government policy changes. For

current information on options for homeowners after a natural disaster, please see Twelve Tips

for Homeowners After Natural Disasters and the Homeowner Post-Disaster Road to Recovery

Flow Chart.

Why

Obtaining Mortgage Relief

for Victims of Disasters:

A Practice Guide for Advocates

February 2020

By

Alys Cohen, Margot Saunders, Odette Williamson

and Emily Green Caplan

National Consumer Law Center?

? Copyright 2020, National Consumer Law Center, Inc. All rights reserved.

ABOUT THE AUTHORS

Alys Cohen is a staff attorney in the National Consumer Law Center¡¯s Washington office,

where she advocates for fair and sustainable mortgage lending and foreclosure

prevention. She is the co-author of NCLC's Truth in Lending, Consumer Credit

Regulation, Credit Discrimination, and Mortgage Lending. Prior to joining NCLC, Ms. Cohen

worked for the Federal Trade Commission. She is a graduate of the University of

Pennsylvania Law School.

Margot Saunders is senior counsel to NCLC. Ms. Saunders has testified before Congress

regarding a wide range of consumer law matters. She is a co-author of

NCLC¡¯s Consumer Banking and Payments Law and a contributor to other legal manuals.

Margot serves as an expert witness in consumer credit cases, providing opinions on

predatory lending, electronic benefits, servicing, and credit math issues. She is a graduate

of Brandeis University and the University of North Carolina School of Law.

Odette Williamson is a staff attorney at NCLC. Previously, she was an Assistant Attorney

General in the Massachusetts Office of the Attorney General. As an AAG, she also served

on the Elder Law Advocates Strike Force to combat unfair and deceptive acts against

older citizens. She attended Tufts University and Boston College Law School. She is

admitted to the Massachusetts bar. She is co-author of NCLC¡¯s Foreclosures and

Mortgage Servicing.

Emily Green Caplan has worked in both the public and private sectors as an attorney

focusing on discrimination matters. She is a contributing author to NCLC's Access to

Utility Service, Consumer Credit Regulation, Credit Discrimination, and Foreclosures and

Mortgage Servicing. She is a graduate of Harvard College and the University of

Pennsylvania Law School.

ACKNOWLEDGEMENTS

The authors thank NCLC colleagues Anna Kowanko, Jan Kruse, Stephen Rouzer, and

Svetlana Ladan for their assistance.

ABOUT THE NATIONAL CONSUMER LAW CENTER

Since 1969, the nonprofit National Consumer Law

Center? (NCLC?) has worked for consumer justice and

economic security for low-income and other

disadvantaged people in the U.S. through its expertise in

policy analysis and advocacy, publications, litigation,

expert witness services, and training.

Essential Web Resources

Is your home located in a disaster area?



National Legal Aid & Defender Association (NLADA) disaster legal aid



lll

Consumer

Financial Protection Bureau (English and Spanish)



FEMA individual disaster aid





Freddie Mac







Fannie Mae









FHA







VA







asters.pdf

USDA





OBTAINING MORTGAGE RELIEF FOR VICTIMS OF DISASTERS

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Table of Contents

1. Introduction ....................................................................................................................4

1.1 Overview ..................................................................................................................4

1.2 First questions ..........................................................................................................5

1.3 Resources for lawyers helping disaster victims .......................................................6

2. Disaster assistance applicable to all mortgages .............................................................6

2.1 FEMA assistance to homeowners ............................................................................6

2.2 Minimum rules applicable to all homeowners in disaster areas ..............................8

2.3 State assistance for homeowners in natural disaster areas .......................................9

2.4 Distribution of insurance proceeds.........................................................................10

3. Mortgage relief based on ownership of mortgage.......................................................12

3.1 Freddie Mac disaster relief .....................................................................................12

3.2 Fannie Mae disaster relief ......................................................................................24

3.3 FHA disaster relief .................................................................................................36

3.4 VA hurricane-related materials ..............................................................................50

3.5 USDA/Rural Development hurricane-related materials ........................................54

APPENDIX A: Flow Chart: Homeowner Post-Disaster Road to Recovery ....................60

APPENDIX B: Short Summaries of Loss Mitigation Rules for

Government-Backed Loans ...................................................................61

APPENDIX C: Long Summaries of Loss Mitigation Rules for

Government-Backed Loans ...................................................................68

OBTAINING MORTGAGE RELIEF FOR VICTIMS OF DISASTERS

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