Our hearts go out to the families and those affected by the storms and floods in Texas and Louisiana. Entire neighborhoods are submerged, belongings and pets left behind, and many homeowners hoping they have documents to rebuild their lives after such loss. Some had to be evacuated quickly and only escaped with the clothes on their backs. As the flood waters recede, many will be trying to recover, getting back to work, and wondering where they will be supported.
Natural disasters may affect the timeliness of bill payments for immediate needs. Here's why it's going to be okay.
paying debts during a time of disaster
What to Do Immediately
Unfortunately, Hurricane Harvey isn't the first major disaster the United States has encountered. Because of this, the Consumer Financial Protection Bureau has already compiled a list of tasks to complete immediately after these events including:
- Contact your insurance company to begin the claims process on any home, auto, or property damages.
- If you don't have a copy of your policy, ask your insurance company for one. The United States Postal Service will update its website to inform you of any postal disruptions. If you are unable to obtain any mail, have all information forwarded to your email.
- If your mail is disrupted, or you will not be home for some time, put your mail on hold. This will prevent any important documents from getting lost or stolen. The post office will hold your mail for 30 days.
- Call your cell phone provider to inform them of your situation and consider extending your data plan temporarily. If you're relying on your cell phone to get things back to normal, you don't want to get penalized for going over your limit.
- Contact your mortgage company to inform them of your situation. You can search your address on the Mortgage Electronic Registration System website to find your mortgage company information or call them at (888) 679-6377.
- You may qualify for Federal Emergency Management Agency (FEMA) disaster assistance. You can enter your address here to see if you qualify.
- FEMA also offers crisis counseling, unemployment assistance, and legal services.
- Contact your employer to let them know when you'll be returning to work. Ask if they'll be able to still pay you or if the company has survived the event. This information will factor into what you do next.
- Inform creditors, employers, and other important agencies if you are temporarily staying at a different address or using a different phone. Update all contact information so you don't miss anything.
What Bills to Pay & How to Pay Them
A widespread natural disaster not only affects households but businesses too. Your employer may be rebuilding and you may be temporarily out of work. At this moment, the highest priority bills are mortgage, rent, and insurance. For other bills, consider the following:
- If your home is no longer livable, contact your utility companies to suspend service and free up funds.
- Call creditors, especially your mortgage company, landlords, and insurance companies and inform them you're unable to work. They may be able to work with you temporarily.
- Call other creditors such as credit card companies and ask them to put a note on your accounts with your current situation. Give them an idea of when you may be able to resume normal payments. Call them before your next payment is due.
- Make sure your cell phone provider also knows of your situation and how much you will need to rely on their service. If you're unable to pay your bill on time, let them know why.
- If your employer is also affected by the disaster, you may be eligible for unemployment. Contact your state's unemployment office to find out.
- Keep good notes of any phone calls or correspondence with creditors. You may not recall what was said due to the overwhelming stress of the moment.
Creditors may waive late fees, offer payment assistance or temporarily halt your payments for a specified period of time while you rebuild. Whatever the agreement, document the conversation and ask for the agreement in writing. Be wary of any emails that may appear to be from your creditors but may actually be fraudulent scams.
Protecting Yourself and Your Credit
If you are able to return to your property, take photos of any damage. If you are running out of space on your mobile device, download the Google Photos app for free unlimited photo and video storage. Document anything you can to share with your insurance company.
Destroy or take any documents with your personal information such as social security numbers, bank information and so forth. Protection of your identity is crucial at this time.
Assess your financial situation. Do you need to get a new job or will you continue to earn your previous salary? What basics do you absolutely need? A bare bones budget will be helpful to find some sort of normalcy without overspending.
Save all receipts and proof of expenses incurred during this time. This information is important to obtain for insurance and assistance.
If you need to extend your credit limits or open new accounts in order to pay for things, your credit may be impacted. The good news is that your credit score can be repaired once you get back on your feet. Be mindful of what you're spending and do your best to keep good records. Obtain your credit report as soon as you can to see how any recovery efforts affected you. When you no longer have to worry about where you will be sleeping or how to feed your family, do what you can to get your credit back to normal.
You can also add a 100-word written statement to your credit report to offer greater insight on additional accounts, late fees or recent changes to your credit. This statement will not influence your report or score but it will allow lenders to see that you were affected by a natural disaster.
As a consumer debt collection agency, BYL Collections understands that individuals are doing their best to pay their bills on time. A natural disaster is unexpected and, as we've seen with Hurricane Harvey, often the effects are far greater than anticipated. Communication with lenders and creditors is essential to reduce the stress of staying on top of things. Rebuilding is a process. One step at a time.
If you are unaffected by Hurricane Harvey but still want to help, avoid fraudulent charities by choosing from the list of highly rated organizations responding to recovery efforts at Charity Navigator. Or donate to the American Red Cross.
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