Why agents should know FHA 203(h)
FHA Section 203(h) is HUD's mortgage insurance program for disaster victims. When a household's primary residence in a Presidentially-Declared Major Disaster Area is destroyed or damaged badly enough that it must be rebuilt or replaced, 203(h) may help them buy a replacement home or reconstruct.
- No-down-payment FHA financing may be available for eligible borrowers. FHA 203(h) loans don't require the normal 3.5% minimum down payment that standard FHA 203(b) mortgages require — eligible disaster victims can finance up to 100% of the purchase price. In other words, for eligible clients 203(h) can work as a no down payment mortgage — a meaningful difference for a family whose savings went into evacuation and temporary housing.
- Closing costs and prepaids still need to be covered.
- Replacement homes can generally be bought in another county or state, or the family may rebuild.
Many displaced households never hear about the program. Their insurance adjuster, contractor, or FEMA caseworker may not mention it, and many professionals rarely see it. An agent who knows the basics can be the person who says, "Before you sign another lease, let's find out if you qualify for this."
For a full overview, see how FHA 203(h) works and the 203(h) requirements.
Identifying potentially eligible clients
The single most common misconception is that 203(h) is only for homeowners. HUD's consumer guidance says renters may be eligible too. Clients who may be worth a conversation include:
Displaced homeowners
Owners whose primary residence was destroyed or badly damaged and who would rather relocate than rebuild — or who want to rebuild on the same lot.
Displaced renters
Tenants whose rental home was destroyed or made uninhabitable. Many are first-time buyers who assumed ownership was out of reach.
Relocating families
Households that want to move to another neighborhood, county, or state. The replacement home doesn't have to be in the disaster area.
Past clients in the area
Your own sphere in affected counties. A short, compassionate check-in with educational information is often welcome.
Three screening questions: Was the home your primary residence? Is the county in a major disaster declaration — ideally designated for Individual Assistance? Is the declaration less than a year old? If the answers look promising, connect the client with Matthew to confirm details.
Working with a disaster-affected buyer? Share the county and situation with Matthew and he'll help confirm whether 203(h) may fit.
Talk with MatthewHow offers and timelines work
- Confirm the declaration and deadline first. The FHA case number generally must be assigned within one year of the President's declaration date. Buyers late in the window need to move quickly — see current disaster areas for dates.
- Get the buyer pre-approved with 203(h) in mind. Matthew will review documentation of the prior primary residence and the damage along with standard income, asset, and credit documents.
- Plan for closing costs. Closing costs and prepaids still have to be covered. Depending on the file, that may come from the buyer's funds, seller contributions within FHA limits, lender credits, or gifts and grants where allowed. Build this into your offer strategy.
- Write realistic contingencies. FHA appraisal and property standards apply, and disaster-area properties may need extra time for inspections.
- Keep the file moving. Displaced buyers are often juggling insurance, FEMA, and temporary housing. Clear, regular communication from agent and loan officer makes a real difference.
Disaster-area appraisal and inspection realities
When a disaster hits, lenders often take a closer look at every property in affected zip codes — not only 203(h) deals. Lenders may require a post-disaster property inspection or an updated appraisal before closing to confirm the home wasn't damaged. That can apply to your listings and purchases in the area even if the buyer isn't using 203(h).
- Build extra time into contracts on homes in or near affected areas.
- Tell sellers early that a re-inspection may be requested and access will be needed.
- If a property was damaged, repairs may need to be completed — or financed through a renovation option such as 203(h) combined with 203(k) — before the loan can close.
- Appraisers may need time to find reliable comparable sales in a disrupted market.
Documentation your client will need
Displaced families often lose paperwork along with the house, so the sooner they start collecting documents, the smoother the file. A typical 203(h) file includes:
- Proof the damaged home was their primary residence — a driver's license, utility bill, or voter registration showing that address.
- Proof of the damage — the insurance claim or adjuster's report, an inspection or government damage document, photos, and FEMA, county, or city records.
- The purchase contract on the replacement home (or construction documents for a rebuild).
- Standard loan documents — income, assets, and credit, as with any FHA loan.
Replacement copies are often available online from utilities, the DMV, and FEMA. If something truly can't be found, Matthew can help identify acceptable alternatives. The full list is on the requirements page.
Compassionate, compliant outreach
People who just lost a home aren't looking for a sales pitch. The agents who help most lead with information, not urgency:
Lead with education
Share a link to how 203(h) works or the FAQ and let people read on their own time.
Be honest about status
Not every fire or storm opens 203(h). Point people to the disaster-area tracker rather than promising eligibility.
Mind the timing
In the first days, safety and shelter come first. Follow-up in the weeks after, while the one-year window is open, is usually better received.
Avoid language that implies a guaranteed approval or a government endorsement, and follow your brokerage's advertising and solicitation rules.
Workshops and educational materials
Matthew offers the FHA Disaster Recovery Workshop™, a complimentary educational session for brokerages, teams, Realtor associations, and community groups. It covers how 203(h) works, identifying potentially eligible homeowners and renters, documentation, current disaster areas, sharing accurate information with affected families, and common misconceptions.
Matthew-branded, plain-English 203(h) consumer explainers are available on request, and agents may share them with clients who could benefit.
Realtor marketing support — coming soon
Co-branded flyers
Coming soon: educational 203(h) flyers for open houses, listing presentations, and community events.
Social media graphics
Coming soon: simple, accurate graphics explaining 203(h) basics for your social channels.
Email templates
Coming soon: compassionate, plain-English email templates for reaching past clients in affected areas.
Resource library — coming soon
- FHA 203(h) one-pager — the program on a single page.
- Disaster homebuyer guide — step-by-step help for displaced owners and renters.
- County disaster updates — declaration status for areas Matthew is tracking; for now, see current disaster areas and news.
Want to be notified when these are ready? Mention it in the form below.
Other disaster recovery partners
Agents aren't the only professionals who meet displaced families first. Matthew welcomes conversations with anyone helping people recover, including:
- Insurance agents and public adjusters
- Restoration contractors and roofers
- Property managers who manage rentals in affected areas
- Attorneys working with disaster-affected clients
- Community organizations, churches, and long-term recovery groups
The same rule applies to every partner: nothing of value is exchanged for referrals. The goal is simply making sure more families know 203(h) exists. Existing homeowners who plan to stay put may be better served by the mortgage relief options guide.
Frequently asked questions
Can renters use FHA 203(h)?
HUD's consumer guidance says renters may be eligible if their primary residence was in a major disaster area and was destroyed or damaged to the extent it must be replaced. Matthew will confirm the details for each buyer.
Does my buyer have to purchase in the disaster area?
No. The replacement home can generally be in a different county or state, as long as it will be the buyer's primary residence and meets FHA guidelines.
Does 203(h) require special contract language?
Not typically, but give the buyer enough time for the appraisal and any post-disaster inspection, and plan in advance for how closing costs will be covered.
Do you pay referral fees?
No. Nothing of value is exchanged for referrals. Workshops and educational materials are provided so consumers understand their options.
How do I request a workshop for my office?
Use the request form on the workshop page or call Matthew at (512) 952-1125.
Agents & partners: talk with Matthew
Tell Matthew a little about the property and your plans. He'll follow up by phone or email — no obligation.
Prefer to start now? Start your pre-approval · Schedule a call · (512) 952-1125
Please don't include Social Security or account numbers.