Presidentially-declared Federal Disasters

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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 Letter 2004-32. 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/library/drcys.shtm or by calling the local FEMA office.

The 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.