Natural disasters have a way of upending years of hard work and stability in as little as a few minutes. If you’ve been through one of these before or you’re going through it right now, a certain amount of shock is understandable. There can be so much to do that you may not know where to start.
In the aftermath of a disaster, the most important thing to take care of is the safety and well-being of you and your family. Once things have stabilized a little bit in the area, it’s time to figure out the best way to move forward and get started on cleanup and rebuilding.
The goal of this post is to give you the resources you need to begin putting the pieces back together. Before we get into that, take a deep breath and remember to take things one step at a time. What Mother Nature destroyed in minutes could take months to rebuild, but you can do it. You’ll get through this.
What to Do Immediately After the Event
In the event’s immediate aftermath, there are a couple of things you can do when you first get back to your property in order to make sure the rest of this process goes as smoothly as it can under the circumstances.
Secure Your Stuff
You’ve got enough on your mind when evacuating in the wake of a natural disaster. The last thing you’re thinking about is what to do with all of your personal documentation. You may leave a lot of stuff behind in the name of getting out in a hurry. Unfortunately, unscrupulous individuals can use this information to steal your stuff and even your identity.
There are a few things you can do to protect your personal information immediately on your return home:
- Get in touch with creditors immediately and report any lost credit cards. Your bank will be able to help you replace lost checks or a bank card.
- Shred any papers with personal information that you find when cleaning up so identity thieves can’t use it for their own purposes.
- You can place a three-month fraud alert with the three major credit bureaus – Equifax, Experian and TransUnion – so that creditors have to call you in order to make sure you’re the one actually applying for any kind of credit. This could be especially useful if you had to take off in a hurry.
Document the Damage
Before making any repairs at all, you want to document the full extent of the damage for the insurance company. You can do this by taking pictures, including of any debris. Keep careful records of anything that was damaged.
You’ll need this when it comes time to talk about the settlement with the insurance company so that you can get accurate replacement value.
The Rebuild Process
When it’s time to rebuild, there are a few important items to take into consideration. Among them, you need to think about what your insurance covers, and what your options are for alternative funding to insurance.
Making a Homeowners Claim
One way to get your home repaired is to make a homeowners claim. If you plan on using your homeowners insurance to cover the cost of repairs, there are a few things you need to know.
Be sure to know what your insurance covers. If you don’t know the exact terms, contact them and ask them for a copy of your policy. Unfortunately, flooding is typically not covered and requires an additional flood policy. Unless you’re in an area particularly susceptible to flooding, your mortgage company may require you to carry the additional coverage. If this is the case for you, check out some of the other sources of funding available in the next section.
You’re going to have to come up with the money to cover any deductible you may have. If that amount is a little steep for you at the moment, one resource we’ll cover below may help.
Depending on the amount of your claim, your mortgage lender may have to schedule inspections to make sure that your home is being restored to a condition that’s as good or better than it was before the damage. The reason for this is that major mortgage investors like Fannie Mae, Freddie Mac, the FHA and the VA need to protect their investment in your home in case you fall on hard times and they need to sell your home.
Depending on the scope of the claim, repairs may be done in stages, with your home insurer issuing checks incrementally for the work rather than the full amount. In this case, multiple inspections would be set up by your lender.
If you get a mortgage, your lender will likely require you to have homeowners insurance to protect the investment. In this situation, your mortgage lender will be listed on the homeowners policy as well. Your lender will need to endorse the check before you can use it to pay for repair.
If you’re a Quicken Loans client, you can get in touch with our Insurance Loss team by giving us a call at (866) 947-8425. It will go more smoothly if you contact your insurance carrier first, but be sure to call us early on and we can help you through the process.
Damage Prevention
You don’t want to start making permanent repairs until an insurance adjuster has seen your property to fully evaluate any damage. Your insurance company may be able to advise you on next steps.
In any case, you’re responsible for taking measures to mitigate against further damage being done before the repair is completed. With that in mind, you should begin thinking about temporary repairs. The exact steps you going to take depend on damage, but here are a few common items that need to be taken care of:
- Rip out wet drywall and carpet to prevent the spread of mold
- Use boards to close openings on the property
- Put up tarps
- Installing fencing will protect your belongings and prevent bystanders from getting hurt by entering unstable areas
Document your cost for all of these temporary repairs. Your insurance company may reimburse you.
Home Repair Issues to Avoid
There are a few things you need to avoid as you get into the home repair process. We’ll go over a few of them below, including:
- Don’t make any permanent repairs before the adjuster has been to the property. This will likely hamper your ability to get reimbursed if they don’t know the full extent of the damage.
- Avoid fly-by-night contractors. You don’t want someone who’s just out to make a quick buck working on your home. Be sure they’re licensed and have good references.
- Don’t make full payment up front and get everything in writing. This will help ensure the full scope of the work is completed to your and your lender’s (if necessary) satisfaction.
Additional Resources for Funding
If you need temporary help with expenses – or filing a homeowners insurance claim isn’t possible or doesn’t make sense for you – there are other sources of funding to help you rebuild.
The Federal Emergency Management Agency (FEMA) offers all sorts of assistance for people whose area has been declared a disaster area by the federal government. You can also apply for grants designed to help with rebuilding. Check out the resources FEMA offers.
In addition, you can find all sorts of local resources for your area on this page if your state has set up branches of its emergency management agency anywhere near you.
The American Red Cross also offers assistance with food, shelter and medical care on a temporary basis during disasters. The organization also helps with recovery plans.
Another good resource is the Small Business Administration (SBA). The SBA offers low-interest disaster relief loans for businesses of any size, nonprofits and even homeowners. They can be used to replace real estate, personal property, machinery and equipment, and inventory or business assets.
If You Need to Relocate
If the rebuild is going to take a while, you may need to find somewhere to call home for a while. On the other hand, maybe you want to consider permanent relocation. Let’s go over your options and what you should know.
Temporary Living Arrangements
If you can’t stay in your house while it’s being repaired, you’ll need to find a place to stay. There are a couple of ways of going about this.
FEMA has a great site where you can find hotels with rooms that the agency will temporarily pay for in order to help you transition.
If you’re going to be out of your home for an extended period, it may be cost-effective to look at renting an apartment. Whether it makes more sense to go with a rental agreement or lease will depend on how long you anticipate staying. You may want to shop around to avoid opportunistic price gouging.
Be sure to know which amenities are included in the terms of any agreement. Also, keep your receipts. Your insurance company may reimburse you for the cost of temporary lodging.
Permanent Relocation
If you and your insurance company decide that the length of the time for the rebuild and the cost means it makes more sense for you to just move on to a new house, you may be able to negotiate that settlement with them. If you do that, there are a couple of things you should know.
In order to make a settlement work where you can move on to a new house, you have to make sure it’s at least enough to satisfy the remainder of the mortgage.
Your insurance company is also responsible for helping you with replacement value, so the new house is supposed to be as good as your old one, but not necessarily better. If your new home has any amenities your old one didn’t, you’ll have to pay the difference.
If you have a serious disagreement with your carrier over what constitutes replacement value, you can hire an independent public insurance adjuster. However, it’s worth noting that these insurance adjusters typically get paid by taking a percentage of the settlement. If the amount you get is lower after this percentage is taken out, you may be better off taking the insurance company’s offer. It all depends on the size of your dispute.
It can be a process, but hopefully this helps you get some idea of how to get the ball rolling again after Mother Nature throws a curveball. If you have any questions, leave them for us in the comments. We’ll do our best to answer them or direct you to the right place.
If you need assistance with your mortgage payment, you can give us a call at (800) 508-0944 and we’ll be happy to work with you to find a solution. If you need assistance with an insurance claim, our Insurance Loss team will be happy to work with you at (866) 947-8425.
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