When an emergency strikes, the last thing you want to worry about is the financial logistics of fixing the damage to your home. Depending on your homeowner’s insurance policy and where you live, issues and emergencies like flooding, ground movement, mold, infestations, nuclear hazards, wind damage, pet damage, government action and general wear and tear maintenance may not be covered.

After any accident or disaster, it is important to provide documentation for your insurance claim by making a detailed list of damages and taking photos. It is also recommended to track expenses incurred due to the disaster, such as hotel and travel costs, as they may be reimbursed depending on your insurance policy guidelines. Below you’ll find a list of loan and payment program options for various unexpected repairs for homeowners.

Natural Disasters & Extreme Weather

Depending on the level of structural damage sustained from flooding, fire, strong winds or foundation movement, a home inspection may be required to determine which repairs are necessary. Roofing issues, water damage, foundation cracks and damage to load-bearing walls are expensive and could require additional loans to complete in a timely manner.  

• Depending on how much equity you have in your home, the cost of repairs and your loan-to-value ratio (LTV), a cash-out refinance may be a good option for major home repairs.
• According to the Small Business Administration Disaster Loan Assistance Program, “Homeowners [in a declared disaster area] may apply for up to $200,000 to replace or repair their primary residence. The loans may not be used to upgrade homes or make additions unless required by local building code. If you make improvements that help prevent the risk of future property damage caused by a similar disaster, you may be eligible for up to a 20 percent loan amount increase above the real estate damage.”
• The Federal Housing Administration’s Section 203(h) program also offers mortgage insurance for disaster victims to make it “easier for them to get mortgages and become homeowners or re-establish themselves as homeowners.”
• The Federal Emergency Management Agency’s Individuals and Households Program (IHP) provides “money for homeowners to repair damage from the disaster that is not covered by insurance. The goal is to repair the home to a safe and sanitary living or functioning condition,” not necessarily to the home’s condition pre-disaster.

Maintenance & Repair

Whether repairing a broken HVAC system, dealing with plumbing issues, or replacing a major household appliance, homeowners are typically on their own when it comes to standard home and appliance maintenance/repairs. However, homeowners may still be able to secure the following assistance:

• A HELOC (Home Equity Line of Credit) is a great loan option for standard home repairs that allows homeowners to draw against their home equity to finance needed repairs and preventative maintenance.  
• A home warranty plan supplements your homeowner’s insurance and covers essential appliances and systems in your home. Like most insurance plans, this policy must be in place prior to filing a claim.

If at any point you become unable to pay your mortgage due to an unexpected emergency, contact your mortgage servicer or lender, as well as the insurance provider for your homeowner’s policy and any additional policies you carry. Depending on your situation, you may be eligible to enter a mortgage forbearance agreement.