Note: Mortgagee Letter 05-13
advises that the Federal Emergency Management Agency (FEMA) no longer provides
the Mortgage Assistance Payments referred to in Mortgagee Letters 2004-37 , 2004-36,
and 2004-32. Mortgagees should no longer refer mortgagors to this program.
Mortgagees are reminded that requirements for servicing mortgages in Presidentially
Declared Disaster Areas are provided in Chapter 14 of HUD Handbook 4330.1, Rev-5,
Administration of Insured Home Mortgages, restated most recently in Mortgagee
A 90 day moratorium on foreclosure
is automatically imposed on properties actually affected by the disaster. Effective
with Mortgagee Letter
98-20, the Department ceased issuing separate Mortgagee Letters for each disaster
declaration. Rather, when the President declares a disaster, the mortgagee must
check with the Federal Emergency Management Agency (FEMA) to obtain the specific
affected counties and corresponding declaration dates. This information can be
found at http://www.fema.gov/news/disasters.fema
or by calling
the local FEMA office.
Department is aware that there may be situations where the mortgagor's property
is not affected by the disaster, but the mortgagor's financial viability is affected.
Where this has occurred and the mortgagor has provided supporting evidence of
the financial impact, mortgagees shall also include those mortgages in the moratorium.
regarding a 90 day moratorium
on foreclosures, or any other servicing provisions on properties
directly affected by Presidentially-declared disasters should be
directed to HUD's National
note that Mortgagee
Letter 99-11 changed the Pre-foreclosure sale (PFS) minimum ratio of as-is
appraised value to unpaid balance to 65 percent for properties affected by Presidentially
declared disasters. The PFS minimum ratio was reduced to 63 percent for any homeowner
eligible for Loss Mitigation by Mortgagee Letter 00-05; and to 58 percent for
properties affected by Presidentially declared disasters per
Mortgagee Letter 01-07.