Speaking in Nashville where he and U.S. Commerce Secretary Gary Locke got a first-hand look at some of the damage from last week's floods, Donovan said he had ordered the moratorium on all Federal Housing Administration lenders, The (Nashville) Tennessean reported.
"It is simply wrong for a family struck by natural disaster to be victimized again by a foreclosure because they can't make their payments," Donovan said.
Locke said 18,000 people had registered for federal disaster relief and $29 million in aid had been approved, the newspaper said.
Forty-two Tennessee counties have been declared federal disaster areas, making them eligible for government assistance.
Nashville Mayor Karl Dean said the latest estimate was the city had sustained $1.56 billion in damage and interim Police Chief Steve Anderson said a 53-year-old homeless man was the city's 10th fatality, bringing the state total from the flooding and storms that precipitated it to at least 20.