What Happens to Your Mortgage, Rent, and Bills If Your Home Is Destroyed?
When disaster strikes, the images of devastation can feel overwhelming. Families lose their homes, neighborhoods are left in ruins, and entire communities are forced to pick up the pieces. Here in Wisconsin, we may not face wildfires like those in California, but severe storms, flooding, and tornadoes can have just as devastating an impact.
If your home is damaged or destroyed in a natural disaster, one of the biggest questions on your mind is likely: What happens to my financial responsibilities? Mortgage payments, rent, utility bills—do they all just stop? The answer isn’t always simple, but there are relief options available.
Let’s walk through the most important things homeowners and renters need to know if they’re facing an unexpected loss.
Do You Still Have to Pay Your Mortgage If Your Home Is Destroyed?
Yes, even if your home is no longer standing, your mortgage obligation doesn’t disappear. However, lenders do offer relief options for homeowners impacted by disasters.
Homeowners can request forbearance, which temporarily suspends or reduces mortgage payments for up to 12 months. This applies to loans backed by Fannie Mae, Freddie Mac, the FHA, and the VA. During this period, you won’t face late fees or foreclosure proceedings.
However, forbearance is not forgiveness. Once the forbearance period ends, you’ll need to repay the missed payments—either as a lump sum, in installments, or by extending your loan term.
If your mortgage is with a private lender, your options may vary, but many banks, including Chase and Bank of America, offer similar disaster relief programs. If your home has been severely damaged or destroyed, reach out to your mortgage servicer right away to discuss your options.
What Should You Do Immediately After Your Home Is Destroyed?
If your home is declared a total loss, your first step should be to contact your insurance provider. Filing a claim as soon as possible can help you access benefits like temporary housing assistance and coverage for rebuilding costs.
It’s also crucial to document everything. Take photos and videos of the damage, keep receipts for any immediate expenses (hotels, clothing, pet boarding, etc.), and track any temporary living costs—your insurance may reimburse these.
FEMA and the Small Business Administration (SBA) also provide disaster assistance. FEMA offers grants to cover necessities like food and housing, while the SBA provides low-interest loans to homeowners and renters—even if you don’t own a business.
What Happens to Rent Payments After a Disaster?
If you're renting and your home becomes unlivable, your lease may automatically terminate, and you should no longer be responsible for rent. Here in Wisconsin, landlords are generally required to return your security deposit if the property is uninhabitable.
For rental units with partial damage, tenants can often choose to either stay while repairs are made or terminate the lease. If you remain in the home, your rent may be suspended until the unit is safe to live in again.
Renters who don’t have insurance may still qualify for FEMA assistance or SBA loans to help cover relocation expenses and replace lost belongings.
Do You Still Have to Pay Utility Bills?
Utility companies have different policies when it comes to billing after a disaster. Some providers automatically suspend payments for affected areas, while others may forgive bills for homes that are completely destroyed.
If your home has suffered severe damage, contact your utility providers right away to ask about available relief options. Many companies will work with you to suspend or adjust payments while you recover.
Can You Get Relief on Property Taxes?
If your home has suffered significant damage, you may qualify for property tax relief. In Wisconsin, homeowners can apply for a reassessment, which may temporarily reduce your property taxes until repairs or rebuilding are complete. If you experience a total loss, be sure to reach out to your local assessor’s office to see if you qualify for a tax adjustment.
What If You Don’t Have Homeowners Insurance?
For uninsured homeowners, disaster relief programs can be a lifeline. FEMA provides grants for immediate needs like temporary housing and food, while the SBA offers low-interest loans—up to $200,000 for structural repairs and $40,000 for replacing lost belongings.
Nonprofits like United Policyholders also offer guidance to homeowners navigating the recovery process. Even if you don’t have insurance, there are resources available to help you rebuild, but staying organized and seeking assistance is key.
How Can You Find Temporary Housing?
Finding a place to stay after a disaster can be challenging, especially when demand for rentals skyrockets. However, many organizations step in to help.
FEMA’s housing assistance program provides short-term rental assistance and direct housing solutions.
Airbnb.org often partners with hosts to offer free temporary housing for disaster victims.
Some hotels and apartment complexes may offer discounts to displaced residents.
If you need housing assistance, start by checking FEMA’s resources and asking local organizations for additional support.
How Do You Cope Emotionally After Losing Your Home?
Losing a home is not just a financial burden—it’s an emotional one, too. The stress of navigating insurance claims, finding a place to stay, and rebuilding can feel overwhelming. That’s why it’s so important to lean on your support system.
Many communities have resources like counseling services, local nonprofits, and faith-based organizations that can help. FEMA also offers crisis counseling for disaster survivors.
Recovering from a disaster is a long process, but you don’t have to go through it alone. Document everything, reach out to your mortgage servicer and insurance company, and apply for all available aid. With persistence and support, you can rebuild—not just your home, but your life.