Your Mortgage : Relief for Quake-Battered Owners

Mortgage relief and other help is available for homeowners who are suffering financial hardship as a result of the Northridge earthquake, according to spokesmen for a variety of government loan programs and commercial lenders.

The kind of help available is determined by the type of loan:

Federal Housing Administration (FHA) loan. The FHA is offering rehabilitation loans for repairs to damaged homes, up to a maximum of $25,000. It is also lowering equity requirements and liberalizing down payments for refinancings that include repairs to damaged homes, according to Nick Retsinas, an assistant commissioner with the Department of Housing and Urban Development.

FHA mortgages are available to any qualified borrower up to a maximum of $151,725. FHA, a division of the Department of Housing and Urban Development, does not make the loan. Rather, it insures lenders in event of borrower defaults and foreclosures.

Department of Veterans Affairs (DVA). This federal agency is active in four specific ways, according to DVA Secretary Jesse Brown. They are:

1--Offering the local DVA inventory of foreclosed properties to the Federal Emergency Management Agency (FEMA) for use by those rendered homeless from destruction of their homes.

2--Placing a hold on closings for properties in escrow, pending assessment of damages and possible renegotiations.

3--Expediting tapping into life insurance cash values for veterans needing cash in a hurry, accomplishing this in as little as three days.

4--Placing a 90-day moratorium on foreclosures.

This type of financing is available only to qualified veterans, generally for up to a maximum of $184,000, to purchase a residence. Also called GI or VA loans, these are not insured, but guaranteed, by the DVA.

Federal National Mortgage Assn. (FNMA). Fannie Mae is offering five special relief efforts to assist homeowners experiencing hardships from the quake, according to spokesman Tom Marder. They are:

1--Waive late payment charges.

2--Extend forbearance through temporary suspension of loan repayments.

3--Modify the loan in some form, such as through extending the term for repayment.

4--Not reporting delinquencies to TRW and other credit bureaus.

5--Assisting borrowers with evaluating quake damages, filing insurance claims and expediting disbursements of funds to which they may be entitled.

Fannie Mae is not a lender, but a purchaser of mortgages through what is known as the secondary market, up to a maximum of $203,150 for a single dwelling, including condos, townhouses and co-ops.

Federal Home Loan Mortgage Corp. (FHLMC). Freddie Mac is asking its mortgage loan servicers to provide forbearance services to borrowers whose homes have been damaged or destroyed in a variety of ways, said spokeswoman Nancy Condon. They are:

1--Suspend collection, foreclosure and eviction proceedings for up to 90 days.

2--Work out delinquent mortgage assumptions, pre-foreclosure sales, short payoffs, charge-offs or deed in lieu of foreclosure arrangements.

3--Assist quake victims with the loss-of-use clause where applicable.

4--Help qualified borrowers whose loans are not delinquent to obtain insurance advances of as much as 10% of the outstanding mortgage balance to buy building materials

5--Check out the licensing status and qualifications of any contractors to be involved with repairing or rehabilitating the property.

Freddie Mac is not a lender, but, like Fannie Mae, buys mortgage through the secondary market, up to a maximum of $203,150 for homes, including a condos, townhouse and co-op.

California Department of Veterans Affairs (Cal-Vet). All contract holders, as the purchaser is called, are insured for the guaranteed replacement cost against structural damage, equaling the insurance coverage, a spokesman said. Homeowners should contact the nearest Cal-Vet office for disaster claim forms and processing.

The Cal-Vet program is available to all qualified veterans for the purchase of homes with a maximum loan of $198,750 in Los Angeles and $210,800 in Ventura County.

Conventional loans from portfolio lenders. Although there is no concerted effort to provide relief efforts by direct lenders, borrowers victimized by the quake should contact their respective lenders to work out forbearance plans.