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Natural Disaster – Financial Toolkit – Please Share

Hurricane-Irma

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Natural Disaster – Financial Toolkit – Please Share

The CFPB, The Consumer Financial Protections Bureau just issued a financial toolkit for #Hurricane Harvey.  We just thought it could be appropriate for any large natural disaster.

When a catastrophe like a hurricane, earthquake or tornado or other natural disaster hits your world can be turned upside down.  In fact nearly 25% of Americans have $0 in emergency savings. During these tough times, it may be difficult to know who to trust and where to look for guidance. You need to be aware of the financial steps necessary to take as you begin recovering.

Related: Half of Americans Cannot Afford Unforeseen Expenses over $500!

These three organizations that can help immediately after a natural disaster:

Once your most urgent needs are addressed

Start thinking about your financial obligations and needs.  Here are five steps to help you secure your home and finances:

1. Contact your insurance company. If the storm damaged your home, car, or property, start the claims process by calling your insurance company. With claim damages related to flooding or storm damage, you should verify that you have the right kind of coverage. If you don’t have a copy of your insurance policy, make sure to ask. Ask for an electronic copy of your policy, as ground mail will be slower and difficult to access. That will help you verify your coverage. Take photos and videos of your damaged property. Documenting all the damage will help you with your insurance claim.

2. Register for assistance. Registering online at www.DisasterAssistance.gov .  This the quickest way to register for FEMA assistance. If you are unable to access the internet,  call at 1-800-621-3362.

3. Contact your mortgage loan provider. Talk to your mortgage lender right away and tell exactly what happened.  Damage to your home does not eliminate your responsibility to pay your mortgage. However, your lender may be willing to work with you given the circumstances.  If you don’t have your lender’s contact info, you can search the Mortgage Electronic Registration Systems (MERS)  or call toll-free at (888) 679-6377 to find information.

4. Contact your credit card companies. If you are out of work or your income is interrupted and you’ll have trouble paying back debts. Contact your lenders as soon as possible.  Ask your creditor to work with you. Explain your situation and when you think you might be able to resume normal payments. It is important to make those calls before your next payments are due.

5. Contact your utility companies. If your home is damaged to the point you can’t live in it, ask the utility companies to suspend your service. This could help free up money in your budget for other expenses.

After contacting the companies related to your most urgent financial needs, take a look at your bills and set priorities—including your mortgage, rent, and insurance payments. Given the countless people experiencing distress from the flooding, contacting your creditors may be difficult. Be persistent and make every effort to reach them.

Financial Toolkit – Additional resources

  • Forbearance. Depending upon the type of loan you have, your lender may be willing to temporarily reduce or suspend your payments; this is referred to as forbearance. To learn more, visit the U.S. Department of Housing and Urban Development (HUD) . If you have student loans, ask your servicer if you qualify for a temporary forbearance. Federal student loan borrowers may be eligible for up to three months of forbearance .
  • Insurance settlement. This quick guide will provide you with some of the basics about how an insurance settlement works. Typically, your mortgage servicer will release a portion of the settlement money before work begins so you can hire a contractor. When the work is halfway finished, the servicer will typically release more money. The rest will be released once the job is finished and the home passes inspection.
  • How to choose a contractor. Read our tips to consider when evaluating contractors to help fix or rebuild your home after a disaster.

Related: 5 Tips to Increase Your Emergency Fund

Warning: Be Aware of Scams

You must truly be careful. While most Americans are truthful and honest, there are still a number of crooks and criminals ready to “attack” when people are down.  There is an increased risk for scams and fraud. To avoid scams, you need to ask questions—lots of them. If something is too good to be true, it’s probably not true.  Go with your instincts and reputable service companies.  If the person trying to sell you a product or service can’t or won’t answer your questions, this is a red flag that you might want to look for someone else to do business with.

What to Watch Out For:

  • People who want you to pay up-front fees to help you claim services, benefits, or get loans.
  • Contractors selling repairs door-to-door, especially when they ask to receive payment up front or offer deep discounts.
  • Con artists posing as government employees, insurance adjusters, law enforcement officials, or bank employees. It is easy to fake credibility and uniforms, so do not give out personal information to people you don’t know. Government employees never charge to help you get a benefit or service and will never ask for payment or financial information.
  • Fake charities. Normally, legitimate organizations do not have similar names to government agencies or other charities; so if they do, it may be a scam. Never give out donations over the phone.
  • Limited time offers. Anyone who offers you something and tells you that it is for a very limited time may be trying to pressure you into something that you could later regret. You should never be pressured to make a decision on the spot or to sign anything without having enough time to review it. Take your time, read and understand anything presented to you, and ask a trusted friend, relative, or attorney before acting.  

Starting over requires a lot of hard choices. If you have been affected by disaster and want to make sure your financial records are secure, here is a checklist  to help you consolidate all the information you need—including account numbers, personal records and financial records. Being prepared and knowing how to protect yourself can help you avoid scams and get back on your feet faster.

 

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