No, they cannot take your home. If it is like my state, all they can do is file a lien. Did you call them for the temp repair or FEMA?
It looks like we have quite a few calls to make on Monday! They said that in two weeks, Blue Roof received more than 30,000 requests for assistance, can you imagine how many people received notices like this??
I am fairly certain that DS is correct. They can only file a lien. If you ever try to sell your house, they would get the first proceeds. Something sounds very fishy about this to me. I would contact either a lawyer, or maybe the TV station to see what they "advise". $11,000 for a blue tarp sounds completely wrong, maybe that's why FEMA wouldn't pay. Good luck!