As communities across Texas recover from devastating flooding, the Federal Housing Administration (FHA) has issued updated guidance for servicers and originators working with borrowers in Presidentially-Declared Major Disaster Areas (PDMDA).

Relief for Existing FHA Borrowers

Lenders must implement a 90-day foreclosure moratorium beginning on the date of the disaster declaration. They are also encouraged to offer forbearance options to give borrowers time to make repairs or manage financial setbacks caused by the flooding. 

Guidelines for New FHA Loans in Disaster Zones

For new originations in impacted areas, lenders must exercise due diligence to assess whether the property has been affected.

• If damage exists, repairs must be completed prior to FHA endorsement. 
• Exceptions may apply if the home remains habitable and a repair escrow is in place. 

For full guidance, view Mortgagee Letter 2025-35 on FHA Info.