Renters and homeowners who desire to purchase homes may take advantage of FHA Section 203(h) entitled Mortgage Insurance for Disaster Victims. In a nutshell, the 203(h) Disaster Relief Program provides the following benefits:
- Assists victims with substantially damaged homes that are in the process of buying another home
- Facilitates mortgages for renters and homeowners in the affected areas
- Requires no down payment, minimum credit scores of 620, and maximum debt-to-income ratio of 31/43 percent
- Requires buyers to pay closing costs and prepaid expenses or arrange for premium pricing; sellers may offer concessions (six percent limitation) but gift funding is not permitted
- Evidence of destruction is required
- Mortgage insurance premiums are paid upfront and monthly
The Federal Housing Administration (FHA) Section 203(h) is a Disaster Relief Program that addresses home loans designed for purchasers of single-family homes and FHA-approved established condominium projects. All properties must be used as primary residences. The following properties are ineligible for this program: investment properties, second homes, attached properties, 2-4 unit properties, manufactured homes, co-ops, condo tells, and timeshares.
Under Section 203 (h), only the following home loan products may be considered by lenders and home buyers: 10, 15, 20, 25, and 30-year-fixed, fully amortizing loans.
The counties and cities affected by presidentially-declared disasters are listed on the website for the Federal Emergency Management Agency (FEMA). The agency also lists the dates that each disaster was declared.
Renovation and rehabilitation of severely damaged properties affected by disasters are addressed under separate legislation, FHA Section 203(k) for owners rebuilding their existing home.
Find out more about Home Loans by contacting Taylor Mortgage Group
For information about creative solutions, Disaster Relief Programs, other home loans, reverse mortgages, and other mortgage products used to develop housing, businesses, industries, and cooperatives, call Taylor Mortgage Group LLC at 303-339-5950.