The FHA offers this program for the "rehabilitation and repair of single family properties." With most mortgage financing plans, the lender will not release the mortgage proceeds unless the state of the property provides enough loan security. In the case of necessary renovations, the lender would normally stipulate that the improvements be made before green-lighting the long-term mortgage. But loans for hefty repairs, especially those after a hurricane, are costly and come coupled with high interest rates and short amortization periods.
In this case, the victim can get a mortgage loan, at a long-term fixed (or adjustable) rate, to finance the repairs with the mortgage amount based on the projected value of the property once the restorations and improvements have been completed (with consideration of the contracting work).