Important Foreclosure Information For Florida Homeowners Affected By Hurricanes

In this article, we will examine:

• The industry trends that determine how your mortgage may be impacted by a hurricane.
• The financial assistance and legal implications associated with hurricane damage in Florida.
• The process you can expect when working with a qualified attorney to face foreclosure after a natural disaster.

Is My Mortgage Affected If A Hurricane Destroys My House?

Since more than 60% of mortgages in the United States are held by Fannie Mae or Freddie Mac, most lenders will follow the lead of these two agencies when a natural disaster strikes. These agencies issue guidelines that will determine a period of time when homeowners will not be foreclosed on, meaning that banks will be unable to foreclose until the emergency situation is resolved.

However, this does not mean that you are not obligated to make your mortgage payments, it simply means that your lending bank will be unable to initiate a foreclosure during the moratorium period. Additionally, the guidelines issued by Fannie Mae and Freddie Mac may seek banks to offer loan modifications for borrowers to handle a lack of payment. 

Be sure you have insurance, as banks require insurance to ensure they are fully covered in the event that your house is rendered uninhabitable. This is why banks require you to place insurance on your home, as they will receive little tangible value if they cannot protect their collateralized assets.

Will Foreclosure Be Delayed From Hurricane Damage?

If you are in the area where a hurricane or natural disaster occurred, foreclosures will likely not be filed for at least six months, potentially longer. Conditions will be assessed every six months or so after the disaster to determine whether banks may initiate foreclosures. Depending on the severity of the hurricane, this period could extend well over a year.

In Florida, there are generally 25,000 – 30,000 foreclosures per year caused by traditional life events including divorces, deaths, layoffs, etc. Over a number of years, this volume of foreclosures can certainly impact the Florida housing market, as hundreds of thousands of homes have the potential to be taken off the market. This plays on supply and demand principles by lowering housing inventory, therefore raising expenses.

Attorney Jeremy Dubyak is a seasoned lawyer based in Escambia County, Florida who has helped countless clients just like you navigate the intricacies of foreclosure law. With 12 years of dedicated service to Florida clients, he is prepared to guide you in protecting your property from foreclosure so that you can focus on recovering from a natural disaster.

Still have questions? Ready to get started? Contact Dubyak today at (850) 266-7822 to schedule an initial consultation.

What Type Of Remedies Are Available For Homeowners Facing Foreclosure After A Hurricane?

In the event of a hurricane in Florida, foreclosures would be halted or potentially not even initiated during the recovery period. For this reason, lenders are generally incentivized to take on loan modifications, as they can’t risk half of Tampa to quit paying their mortgages. 

Various FEMA programs also exist in conjunction with government programs and emergency funds in resistance to past-due mortgages. While these programs are typically contingent on applications, loan modifications will be available to almost everyone so long as they have a form of income to reapply for a loan. 

It’s important to be aware of any outstanding loans, as there can be a number of liabilities that can work against you. If you have to find a lender, it’s best to consult with your attorney to discuss your options, as you may be unable to take out further loans if you’re already facing a foreclosure lawsuit.

How Would You Help A Client Face The Legal Complexities Of Facing A Foreclosure After A Natural Disaster?

Financial expectations don’t stop in the event of a natural disaster, so the bank is going to continue trying to recollect their money as soon as possible. You still owe money to the bank, and just because they haven’t started a foreclosure doesn’t mean that you don’t have to repay your debts every month. 

Sometimes, hurricanes can lead to the loss of jobs, affecting your ability to make payments on your mortgage. In Florida, it is not uncommon for someone to find that their place of employment no longer exists after a hurricane. Without an income, your ability to avoid foreclosure may be difficult. However, if you can find work and return to paying to make regular payments on your home, you can then apply for a loan modification.

It can get tricky when your financial situation changes to the point that you can no longer pay for your assets, making you ineligible for any loan modification. The best way to prepare for this scenario is to increase your home’s equity by investing in improvements, resulting in more money in your pocket when you sell the home and remove your foreclosure. Then, you can use your remaining funds to move into the next chapter in your life.

While it may take eight or nine years to see any real money from the investment in your home, those who purchased a house in 2021 could be sitting on as much as 30% equity. In this situation, the timing of your home purchase may have been placed in a historically unique financial position. Typically, you would find yourself destitute and in debt, but purchasing your home at the right time may provide you with a wealth of options for increasing your property’s value.

Still Have Questions? Ready To Get Started?

For more information on What Homeowners In Florida Affected By Hurricanes Need To Know About Foreclosure, an initial consultation is your next best step. Get the information and legal answers you are seeking by calling (850) 266-7822 today.