Is There Debt Relief for Disaster Victims?

If it seems there have been more natural disasters in recent years, it’s because there have. From 1980 to 2018 alone, the number of weather-associated natural catastrophes more than quadrupled, according to the Insurance Information Institute. 

Such events can leave people needing all kinds of help, including meeting financial obligations. So, is there debt relief for disaster victims?  Yes, in fact there may be emergency debt relief available, depending on your situation. 

Can Disasters Hurt Your Credit? 

Understandably, when many people think of disasters, they focus on the threats they pose to life and property. However, such events can also impact credit. In many cases, lives has been so upended the victims are in danger of missing monthly payments, or are forced to depend on credit cards for basic needs.

Besides that, disaster-related expenses can add up. There may be a big insurance deductible, hospital bills, repair bills, or whatever. While it is good to have credit cards to cover such expenses, using them will increase credit utilization ratios, which can hurt credit scores.

Should a disaster befall you, it’s important to alert your creditors of your status as soon as you are able, and monitor your credit reports to protect your credit. Unfortunately, scams often abound during catastrophes, so you should be wary of those as well.

Getting Help

In the aftermath of a disaster, your chief priorities are typically ensuring your family’s wellbeing, evaluating property damage and making sure essential needs are met. But what if the disaster has caused you financial woes and you’re worried you can’t pay your bills?

As we mentioned above, the first thing you should do is contact your creditors to discuss possible hardship options. Some lenders won’t extend grace if a payment is missed. So be sure to make contact before your due date.

In some cases you may be granted temporary decreases of your interest rate and/or your monthly payments. Sometimes you can even pause your payments altogether—for a spell. Lenders defer payments on certain types of student loans, and mortgage companies often provide forbearances that can lower or suspend payments for a period. 

While you’re at it, you should also contact your utility, cable, and other service providers to see what kinds of relief they can offer. The Internal Revenue Service may also offer you special tax relief, give you a deadline extension, slash your balance, or permit you to divide your tax bill into multiple payments.


Federal Emergency Management Agency (FEMA) help is usually also available to those affected by disasters. Such assistance is meant to supplement state, local, and voluntary agencies.

Federal support for individuals and families includes disaster housing, grants, unemployment assistance, legal services, crisis counseling, agricultural assistance, and tax relief.

The federal government can also provide:

  • Food to affected individuals and families
  • Funds or loans to restore homes to a safe, sanitary, and functional condition
  • Rental assistance

Other Needs Assistance is a FEMA/State cooperative venture that helps those who have no other private, government, or insurance assistance available. Assistance is offered for a variety of personal property losses including clothing, household items, and tools used for employment. The program will also provide storage of some items to prevent further damage.

So, yes, there is emergency debt relief available to disaster victims, depending upon your circumstances and eligibility. If your debt troubles are more acute, you may also consider a solution such as debt settlement.