The mortgage insurance will be provided by the Federal Housing Administration, which is part of HUD. Rather than making mortgage loans directly, FHA insures loans made by private lenders to homebuyers.
FHA insurance guarantees a lender timely payment of principal and interest, in the event a homebuyer defaults on a loan. As a result, HUD's new initiative will enable a lender to loan a homebuyer up to $5,000 more than the amount needed to buy a home, with the extra money used to pay for the cost of installing a windstorm shelter.
Home windstorm shelters - also known as safe rooms - can provide protection against winds of up to 250 miles per hour and against projectiles traveling at 100 miles per hour.
FHA insured nearly 1.3 million home mortgages in 1999 at a value of $124 billion. Homebuyers pay for the insurance with fees, so no taxpayer dollars are used to provide the insurance.
HUD Assistant Secretary for Housing/Federal Housing Commissioner William Apgar described the requirements for safe room construction at the National Association of Home Builders International Builders Show in Dallas, Texas. The safe room is part of a building and technology product exhibit at the APA - The Engineered Wood Association. The exhibit is called Behind the Walls House.
Designs for the windstorm shelters financed with FHA-insured first mortgages must follow guidelines developed by the Federal Emergency Management Agency, with the cooperation of the Wind Research Center of Texas Tech University. FHA-financed safe rooms must also be consistent with the National Performance Criteria for Tornado Shelters.
Apgar said the Partnership for Advancing Technology in Housing - a joint federal and private sector initiative administered by HUD - is working with FEMA to develop and deploy advanced home technology, such as the safe room design.
The safe room project is part of an ongoing FEMA initiative called Project Impact: Building Disaster Resistant Communities. The project is designed to encourage people and communities to take measures to protect themselves and their property before disasters occur.