It is good news for the beleaguered housing industry – foreclosure suspensions are about to be implemented.Steve Preston of HUD (Housing and Urban Development of USA) declared a suspension of foreclosures on 34 parishes all throughout southern and central Louisiana.
Support was offered to house owners and tenants coming from the low-income group who were forced out from their homes because of Hurricane Gustav. The foreclosure relief plans were for those living in declared disaster zones and whose houses had been insured by FHA (Federal Housing Administration).
Recently, Bush declared Louisiana to be disaster zone. This meant suspension of all foreclosure activity being conducted by FHA in the hard hit regions of the state. This suspension will allow the families some time to work out best alternatives for avoiding foreclosures without worrying about immediate eviction.
In specific flood ravaged regions, HUD allowed a 90-day suspension on the foreclosure of houses that were under the insurance cover of FHA. HUD also began to put pressure on the loan services to come forward with schemes like forbearance, modification of loans, refinances and a waiver of extra charges and fees.
With the declaration of a disaster by the president, many types of federal help became available. It includes financial grants for temporary shelter, repair of existing units, loans with low interest to cover the losses of uninsured property etc.
The aim is to help individuals, families and businesses to recover from the natural disaster.
Following the declaration of disaster by the President, the state will be empowered to divert the existing federal funds towards disaster relief. In this manner, millions of dollars can be redirected to attend to critical requirements.
FHA insurance will be available for those victims of natural calamities who have lost their houses and are facing the impossible task of finding another shelter. The borrowers would be able to avail of 100% financing that would include in it all closing costs. Insurance would be also be made available for mortgages as well as for house rehabilitation. It will be available through one single mortgage.
HUD will be offering vital information regarding housing as the families return in the aftermath of the hurricane. The information will be available online regarding both rental and the sale of reo properties. There are over 69,000 houses and apartments available in Louisiana, Texas, Mississippi, Alabama, Florida and Georgia.
Foreclosures, inflation and unemployment joining hands with natural disaster have made a real witch’s brew of trouble for this region.