Fire survivors with FHA loans on destroyed or damaged properties can breathe a little easier for the next few months.

Some relief is in sight for mortgage holders of properties that burned in August’s wildfires on Maui.

The Federal Housing Administration has announced it’s extending its disaster-related foreclosure moratorium in Maui County through May 6.

Since the deadly Aug. 8 fire in Lahaina, FHA announced a 90-day foreclosure moratorium, halting attempts by banks or other loan servicers from taking people’s homes, condos or properties away from them if they fell delinquent on mortgage payments.

A soil stabilizer was sprayed on burned ash and debris of this house Wednesday, Oct. 18, 2023, in Lahaina. While it is difficult to visually discern the area was sprayed, once dried, it will feel different. (Kevin Fujii/Civil Beat/2023)
Burned ash and debris is all that’s left at this residential property in Lahaina. (Kevin Fujii/Civil Beat/2023)

The moratorium was due to expire on Wednesday, creating stress and uncertainty for many fire survivors who were facing the possibility of having to pay mortgages on destroyed properties while also covering rental payments on new temporary or longterm housing.

At many recent public meetings, fire survivors have spoken about how they didn’t know how they could financially survive, given Maui’s exorbitantly priced housing market.

“When I visited Maui in September, I saw firsthand the damage inflicted by the devastating wildfires. The people of Maui are resilient, but they will need support for years to come to rebuild and recover,” Department of Housing and Urban Development Deputy Secretary Adrianne Todman said in a news release.

“With today’s announcement, we are assuring homeowners in Maui that HUD is here to support them as they navigate next steps with their family,” Todman added.

State Sen. Angus McKelvey, who represents Lahaina and who lost his condo in the fire, had asked President Joe Biden to take action to stop lenders from foreclosing on the owners of destroyed property. On Thursday, he welcomed the FHA announcement and said it was a good first step.

“I want to thank President Biden, Governor Green, Rep. Jill Tokuda and the other members of our federal delegation for delivering this much needed help. This action will help to stop the trauma of foreclosures for many families, especially for those whose homes are no longer standing,” McKelvey said in a press release.

State Senator Angus McKelvey hugs Paele Kiakoua during a Lahaina Strong news conference pleading for Gov. Josh Green to keep West Maui close to tourism Tuesday, Oct. 3, 2023, in Honolulu. More than 10,000 residents of Lahaina and Maui-wide ask for more time to recover from the Aug. 8 fire. (Kevin Fujii/Civil Beat/2023)
State Sen. Angus McKelvey welcomed the FHA’s announcement. (Kevin Fujii/Civil Beat/2023)

McKelvey said he hopes Hawaii’s federal partners and others “will continue to work towards deferment of mortgages for owner occupied properties, especially multimember households, as well as other types of forbearance that could be used to help forestall the sale of Lahaina.”

Besides extending the foreclosure moratorium, FHA is also pushing back the deadline for mortgage servicers to perform certain legal actions related to foreclosure for an additional 180 days after the foreclosure moratorium expires.

Maui County borrowers with FHA-insured mortgages were advised to contact their mortgage or loan servicer immediately for assistance. Borrowers can also get help by visiting the FHA Disaster Relief site or by calling the FHA Resource Center at 1-800-304-9320.

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