(StatePoint) After a disaster strikes, following these essential steps can help you protect your home, stabilize your finances and begin the process of rebuilding:
Contact Your Insurer Immediately. Your insurer will assess the condition of your property and reimburse the costs to repair or replace any damages subject to your policy’s coverage. The insurance company may send an adjuster to investigate your claim and determine how much they will pay. You may consider having a contractor assess the damage and develop a repair plan, but avoid making costly repairs until the adjuster confirms what will be reimbursed.
Many policies also cover the cost of temporary housing, food, pet boarding and other household expenses if you are displaced. When you speak with your insurer, gather as much information as possible about your coverage. For additional assistance with temporary living expenses, contact organizations such as the Homeowner’s HOPE hotline at (888) 995-HOPE.
Contact Your Mortgage Servicer. Let your mortgage servicer know about your circumstances as soon as possible. They can help you understand the mortgage relief options available to you. Forbearance is a common option, allowing you to make reduced payments or pause your mortgage payments for a specified period of time. If your loan is owned by Freddie Mac, you may be eligible for enhanced mortgage relief options.
Know Your Repayment Options. When your disaster forbearance period ends, your options vary depending on your circumstances. Regardless, it’s important to prepare for when your normal mortgage payments resume.
Your mortgage servicer will be in touch within 30 days of the end of your forbearance period. Keep an open line of communication with them to navigate your repayment options, which may include:
• A full reinstatement, in which you pay in one lump sum the total mortgage payments you owe, including taxes and insurance premiums paid, delinquent interest, any legal costs and other expenses incurred by the loan servicer.
• A repayment plan, which increases your regular monthly mortgage payment for a short period of time to make up for the mortgage payments you missed.
• A payment deferral, which moves your missed mortgage payments to the end of your loan term, but keeps your monthly payment amount the same.
• A loan modification, in which you and your loan servicer agree in writing to modify or restructure your mortgage to make it more affordable and sustainable. Loan modifications typically reduce the amount of your monthly payment by changing the terms of your mortgage, which may include the length of your loan term or the interest rate on your loan.
Avoid Fraud. Fraud and scams often spike after natural disasters, making it important to be wary of communications you receive. To help avoid scams, rely on information from trusted resources, such as your mortgage servicer, insurer or HUD-certified housing counselors, and be aware of some of the most common post-disaster scams. These include high-interest loans and repairs, contractors asking for payments in advance of work and entities claiming to be disaster relief professionals requesting your sensitive information.
For disaster relief and mortgage assistance resources, which can help you recover after a disaster, check out My Home by Freddie Mac at myhome.freddiemac.com.
In the wake of a natural disaster, you don’t have to face recovery alone. Being proactive can get you on the road to recovery.
