One year after the tragic Maui wildfires, the U.S. Department of Housing and Urban Development (HUD), through the Federal Housing Administration (FHA), has announced new actions to support borrowers in Maui County, Hawaii, whose homes were destroyed during the August 2023 wildfires.
Effective immediately, eligible borrowers and renters in Maui County who lost their homes, and are in the process of rebuilding or buying another home, can continue to use FHA’s 203(h) Mortgage Insurance for Disaster Victims program to receive up to 100% financing. This latest action underscores the Biden Administration’s commitment to rebuilding Maui communities and helping families recover from disaster.
The announcements are part of the Biden Administration’s ongoing coordinated and comprehensive Federal response to ensure the long-term recovery of survivors and impacted communities. The White House outlined the Administration’s priorities for ongoing and long-term recovery efforts, including moving residents from temporary shelters into longer term housing solutions, supporting home rebuilding efforts, and ensuring that new homes are climate resilient, so families can stay safe as climate-fueled extreme weather events become more frequent due to climate change.
“After wildfires hit Maui last year, people’s homes were destroyed, and people’s lives were disrupted. Immediately after, HUD got to work to help people recover,” said HUD Acting Secretary Adrianne Todman. “This included providing support for people who live in HUD subsidized homes, and providing support for people who were homeless. With this action, today we are continuing our support for homeowners to ensure that they can rebuild and stay on Maui.”
Temporary, Partial Waiver of 24 CFR § 203.18(e)(3) issued lifts the requirement that borrowers apply for 203(h) financing by the one-year anniversary of the Presidentially Declared Major Disaster. The change allows lenders to offer 203(h) financing to Maui borrowers through August 10, 2025.
According to CoreLogic, the U.S. Department of Commerce reported the Maui wildfires caused more than $5.5 billion dollars in damages, and was one of the most devastating in the U.S. in the last five years. The Hawaiian northwest coastal town of Lahaina was practically reduced to ashes and suffered a disproportionate number of deaths as a result of these fires that left many residents with nothing.
Geographic Barriers to Recovery
This new flexibility follows FHA’s third extension of its foreclosure moratorium for borrowers with FHA-insured single-family mortgages in Maui County, Hawaii, which now runs through January 1, 2025. FHA is continuing this relief due to the extent of the devastation from the wildfires, the reduced capacity for borrowers to access needed construction supplies and resources, the number of jobs that have not yet returned, and other unique challenges associated with the geographic location of Maui. The extension will provide affected borrowers in Maui County more time to obtain federal, state, and local assistance, to work with a HUD-certified housing counselor, and/or to rebuild without the added burden of dealing with foreclosure actions.
Over the past year, the Biden Administration has provided nearly $385 million dollars in assistance to individuals and households for response and recovery efforts, including nearly $300 million to provide safe housing to displaced survivors with damaged or destroyed homes.
According to the U.S. Army Corps of Engineers, 1,399 homes need rebuilding. As the community pursues rebuilding efforts, county officials have only approved a fraction of the disaster recovery building permits submitted by homeowners or their representatives. To illustrate the sluggishness of this process, it is worth noting that the first residential property is currently only in the rough-framing phase, which occurs during the early stages of reconstruction. However, there has been progress on other lots with laying utility lines and foundations.
“We remain committed to doing all that we can to help residents of Maui County recover from the 2023 wildfires,” said Federal Housing Commissioner Julia Gordon. “Extending the time to use FHA financing for rebuilding, in addition to extending our foreclosure moratorium, reflects our strong desire to continue helping families trying to rebuild their lives after this uniquely catastrophic event.”
Immediately after wildfires hit the community, HUD issued new flexibilities, provided new resources, and ensured that HUD partners on the ground were ready to assist those affected. HUD then awarded more than $8 million in Rapid Unsheltered Survivor Housing (RUSH)–$6.9 million in February 2024 and $1.3 million in August 2023–to address the needs of individuals and families who are homeless or at risk of homelessness and have needs not otherwise served or fully met by existing Federal disaster relief programs.
