What happens to your finances when disaster strikes? Millions of Americans this summer have been financially impacted by Hurricane Harvey, Hurricane Irma, and the dozens of fires raging across the country. Many will be forced to file for bankruptcy, or readjust their existing bankruptcy case. Whether your home is prone to flooding, earthquakes or other disaster, here’s what you need to know to understand natural disasters and bankruptcy:

 

How to Avoid Filing for Bankruptcy after a Natural Disaster

Sometimes, filing for bankruptcy after a major disaster is the best option. These tips, however, can help you avoid the need for it:

 

Get Proper Insurance

Lack of proper insurance is by far the biggest issue you’ll face when disaster strikes. Review your insurance policy carefully, before a disaster threatens, and make adjustments as necessary.

Inquire about Financial Assistance

Many federal, state and non-profit programs, including FEMA, offer financial assistance in the wake of a major national disaster.

Consider Getting a Loan

Personal, business and property loans may be available to help you rebuild. While this should be a last resort, it can keep your business running, and help you avoid filing for bankruptcy.

 

How Natural Disasters Affect your Bankruptcy Case

Many Americans this year have found themselves amidst disaster in the middle of their bankruptcy case. Often, their plan may fail, or at least will need major readjustment.

What may happen:

• The bankruptcy trustee may waive payments for a couple months
• The bankruptcy plan may need adjusting
• Damaged assets involved in the case may be surrendered
• An insurance check received may be held by the bank until certain requirements are met

 

If you are impacted by a natural disaster, whether you have filed for bankruptcy or not, getting professional help from a bankruptcy attorney is always a good idea. He or she can help you determine eligibility, and the best course of action to recover as quickly as possible.