What the law says
But is this legal? According to Texas statutes, written notice is required to terminate a lease on a "totally unusable" property," and that can be done by the tenant or the landlord. A spokeswoman for Houston city government "said officials were aware of such situations," according to the Huffington Post, but punted to state law as the source for resolution.
With parts of the city still flooded and more than 200,000 homes impacted by the hurricane, thousands of people are now in a state of flux, and that includes owners who are faced with expensive repairs, many of which won't be covered fully by insurance. For most, there is no flood insurance through the beleaguered National Flood Insurance Program to fall back on.
Those homeowners will be in a long line for FEMA funds that won't even come close to covering the cost of rebuilding. From their own website, "The goal of FEMA assistance is to make a home safe, sanitary and functional. FEMA assistance is not intended to restore your damaged property to its condition before the disaster. Our assistance is meant to help you with essential expenses that cannot be covered in other ways like insurance or a disaster loan from the Small Business Administration."
So while they figure out what to do with their house and where they are going to live now, do homeowners have to pay their mortgage? "Borrowers are bound by the promissory note they sign at the closing of a home purchase or refinance to make monthly mortgage payments," said the Wall Street Journal. "Even the total loss of the mortgaged property doesn't relieve borrowers of this obligation. A mortgage also requires the borrower to give prompt notice to both the lender and the insurance carrier in the event of a loss."
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