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» After the Storm SANDY'S IMPACT REVERBERATES THROUGHOUT THE INDUSTRY By Esther Cho and Carrie Bay The strength and devastating force of Hurricane Sandy deteriorated to that of a Category 1 storm by the time it scoured an 1,100-mile path across the country's northeastern seaboard on October 29. The storm claimed 253 lives across seven Atlantic-bordering countries. On just the U.S. mainland, Superstorm Sandy left behind an estimated $30 billion to $50 billion in property damages and losses from business interruptions, according to Nigel Gault, chief U.S. economist for IHS Global Insight. Some estimates go as high as $71 billion. More than a month after Sandy upended millions of families and businesses across more than a half-dozen states, cleanup efforts continue. Those caught in the storm's ire are still trying to piece their lives together, and analysts are still struggling to wrap their heads around the full implications of what may rival Hurricane Katrina as the most costly natural disaster in U.S. history. Gault says his economic team has "assumed that Sandy will take around 0.3 percentage point out of GDP growth in the fourth quarter, but add back slightly more than that in the first, helped by reconstruction efforts." The storm shut down government offices and took the U.S. stock market offline for two days. Nearly 10 million people were without power, 16 some for upwards of a week, and thousands more were left without shelter after Sandy leveled properties from the New Jersey shore to inland Connecticut. Federal housing agencies immediately announced plans to assist borrowers affected by Sandy's run-in with the East Coast. On October 30, HUD issued a 90-day foreclosure moratorium on mortgages insured by the Federal Housing Administration (FHA) in the states of New Jersey and New York. The agency also granted foreclosure forbearance for FHA borrowers in the designated areas. HUD's moratorium was extended to Connecticut storm victims on October 31, Rhode Island borrowers on November 5, Delaware's displaced borrowers on November 19, and Maryland borrowers on November 26. HUD Secretary Shaun Donovan assured homeowners in the impacted areas that HUD would speed federal disaster assistance to them, and he pledged support for both borrowers with federally insured loans and low-income renters forced from their homes by Superstorm Sandy. Through federal programs designed to assist disaster victims, HUD is making insurance available for mortgages and home rehabilitation. The agency's Section 203(h) program provides federal mortgage insurance to borrowers from FHA-approved lenders who have lost their homes because of the disaster and face the daunting task of rebuilding or buying another home. With 203(h), borrowers are eligible for 100 percent financing, including closing costs. HUD's Section 203(k) loan program allows those who've lost their homes to finance the purchase of a new house and obtain funding for any repairs needed, all with a single mortgage loan. It also allows homeowners to finance only the rehabilitation of their existing single-family home if it's been damaged and needs work. HUD is making it possible for affected communities to reallocate federal resources— such as HUD's Community Development Block Grant and HOME programs—toward disaster relief. This effort gives states and communities the flexibility to redirect millions of dollars to address critical needs such as housing, services for disaster victims, and expediting repairs and rehab work. In addition, HUD is offering state and local governments federally guaranteed loans for housing rehabilitation, economic development, and the repair of public infrastructure through its Section 108 loan guarantee assistance program. "Families who may have been forced from their homes need to know that help is available to begin the rebuilding process," Donovan said, adding that HUD will provide assistance wherever it can, whether that's in the form of foreclosure relief for families with FHA-insured loans or providing capital to storm-damaged counties to restore local communities. Fannie Mae and Freddie Mac both updated their disaster relief policies for borrowers impacted by Sandy. One of the policies announced by the GSEs allows servicers to grant 90-day suspensions on foreclosure sales and evictions. Servicers are also authorized to extend forbearance and repayment plans for up to 12 months for certain borrowers. The GSEs say they are speeding up the distribution of insurance proceeds so that repairs on storm-damaged homes aren't delayed. In addition, servicers can offer 90-day forbearance, waive late fees, and suspend credit reporting for borrowers who have been offered relief. Tracy Mooney, SVP of single-family servicing and REO at Freddie Mac, said "Given early assessments of Hurricane Sandy's devastating impact, we are preparing steps that will authorize automatic and immediate action by the nation's mortgage servicers to help more borrowers with mortgages owned or guaranteed by Freddie Mac." Timothy J. Mayopoulos, president and CEO of Fannie Mae, added, "We want families to know that we are here to help them." Fannie Mae advised borrowers to visit KnowYourOptions.com to find out if the GSE owns their loan and if they are eligible for

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