If you are one of thousands of homeowners devastated by Sandy and now wonder where the money is going to come from to make mortgage payments, you may be able to get a loan modification. There are a lot of “ifs” involved.

If your home is in the one of the many areas declared a disaster by President Obama,  and you have a conventional or VA mortgage and are going to have trouble making your mortgage payments,  the Department of Housing and Urban Development (HUD) suggests you contact your lender and try to modify your mortgage.  It’s also possible that if you are not making your payments, the lender will delay foreclosure for 90 days. HUD says it expects banks to be cooperative.
If you have an FHA mortgage loan and you can’t make payments or are facing foreclosure, you may qualify for relief to help you keep your home.  The Department of Housing and Urban Development says, “If you can’t pay your mortgage because of what happened, your lender may be able to help you. If you are at risk of losing your home because of the disaster, your lender may stop or delay initiation of foreclosure for 90 days.
Lenders may also waive late fees for borrowers who may become delinquent on their loans. Just follow the four steps below to see if help may be available to you. You are strongly encouraged to contact your lender for further information, and to see if you are eligible for relief.”


  1. Did you lose income?
  2. Where changes in your financial circumstance caused by the disaster?
  3. Have you missed mortgage payments?
  4. Do you have resources including insurance settlements, to catch up?

FHA lenders are required to reevaluate each delinquent loan and consider the circumstance of the disaster.  So contact your lender immediately.  HUD says this should happen: “During the term of a moratorium, your loan may not be referred to foreclosure if you were affected by a disaster.
Your lender will evaluate you for any available loss mitigation assistance to help you retain your home.
Your lender may enter into a special forbearance plan, or execute a loan modification or a partial claim, if these actions are likely to help reinstate your loan. If saving your home is not feasible, lenders have some flexibility in using the preforeclosure sales program or may offer to accept a deed-in-lieu of foreclosure.”

If you are already in foreclosure contact your lender so that they know you are an affected borrower. You may have to provide documentation, but foreclosure action should stop for 90 days.

In any circumstance, if your lender gives you trouble or won’t help call a HUD-approved counseling agency toll free at (800) 569-4287 or contact HUD’s National Servicing Center.

One thought on “DISASTER”