If a wildfire renders your home uninhabitable, either temporarily or permanently, you may wonder what this means for your mortgage payments. Unfortunately, your mortgage loan remains intact even if your home gets destroyed. You will have to continue meeting your loan payment obligation. However, you may qualify for certain aid that can help you financially in the aftermath of a wildfire. With the recent LA wildfires and ensuing Eaton Fire lawsuits, victims have a path toward recovery.
Contact Your Mortgage Provider
Call your mortgage loan provider as soon as possible if you have to relocate due to serious wildfire property damage. Whether you plan on repairing/rebuilding your home or purchasing a new home elsewhere, you need to call your loan servicer to navigate what this will mean for your mortgage obligation. It is important to never stop paying your mortgage without speaking to your loan provider first. This can lead to significant penalties and further financial debt, as well as harm to your credit and even the possibility of defaulting on the loan and losing your home.
Request Assistance
Mortgage loan service providers understand that families who are displaced from their homes due to wildfire damage are going through a lot of mental, emotional and financial stress. When wildfire disasters happen, lenders are typically open to providing some degree of relief or financial protection. If you come to an alternative agreement with your mortgage provider, make sure to get a copy of the deal you made in writing. Your options may include:
- Disaster mortgage forbearance: a temporary pause on your mortgage payment obligation. If your lender approves your request, you can pay extra once it reinstates to make up for missed payments or the lender will tack on additional months at the end of your mortgage term.
- Mortgage modification: a permanent change to the terms of your mortgage agreement. Depending on your lender and situation, your lender may be open to altering the terms of your mortgage to make it more affordable.
- Insurance claim assistance: coordinating with your lender to use money gained from a property insurance wildfire claim to pay off your outstanding mortgage or pay down the loan.
Note that a mortgage forbearance or other assistance will not happen automatically. You must contact your mortgage provider to discuss your options and apply for the solution that’s right for you. It is also important to keep in mind that you are still held accountable for your property tax obligations in the aftermath of a wildfire.
Apply for Federal Aid
If you are struggling financially after a wildfire and cannot meet your mortgage obligation, you may qualify for financial aid through a government-sponsored relief program. The Federal Emergency Management Agency (FEMA), for example, offers rental assistance that can help you save enough money to continue meeting your mortgage obligation while you’re displaced.
Get Legal Counseling
A wildfire attorney in California can be a critical ally if you’re dealing with mortgage issues, an insurance claim and possible legal action after sustaining fire damage. A lawyer can help you find creative solutions if you are struggling to make your mortgage payments on time, such as coordinating between your property insurance company and your mortgage provider. You can count on an attorney to review your specific case, communicate with your mortgage lender on your behalf, take over property insurance claim negotiations and help you find a way forward in the aftermath of a natural disaster. For information about your specific case, request a free evaluation with the experienced wildfire litigators at Bridgford, Gleason & Artinian.