If you have a reverse mortgage (a Home Equity Conversion Mortgage or HECM) and a natural disaster hits, you might be wondering what happens next. Do you still have to pay property taxes? What if your home is damaged? What if you can’t live in it for a while?
The good news is there are steps you can take to protect yourself and keep your loan in good standing. Let’s break it down.
First Things First: Call Your Loan Servicer
Your loan servicer is the company that manages your reverse mortgage. If a disaster affects your home, call them ASAP—even if you’re not sure what you need.
Here’s why:
✅ They can pause deadlines for your annual occupancy certification.
✅ They’ll tell you what to do if your home is damaged or unlivable.
✅ They can explain next steps for insurance claims or repairs.
If you’re not sure who your servicer is, check your latest mortgage statement or call the U.S. Department of Housing and Urban Development (HUD) at (800) 569-4287.
Know Your Responsibilities
Even after a disaster, your reverse mortgage obligations don’t disappear. You still have to:
- Live in the home as your primary residence (or notify your servicer if you’re displaced).
- Pay property taxes and homeowners insurance.
- Maintain the home (once it’s safe to do so).
If your home is damaged or temporarily unlivable, your servicer can help guide you through your options.
Disaster Relief Resources to Tap Into
If you need financial help or guidance, there are organizations that specialize in disaster relief for homeowners:
🔹 FEMA (Federal Emergency Management Agency): Offers grants for temporary housing, repairs, and other emergency needs. Visit www.disasterassistance.gov or call (800) 621-3362.
🔹 HUD Housing Counselors: Provides free advice on post-disaster mortgage options. Find a counselor at www.hud.gov/counseling or call (800) 569-4287.
🔹 SBA Disaster Loans: Yes, the Small Business Administration (SBA) helps homeowners too! They offer low-interest loans to repair or replace disaster-damaged homes. Check out www.sba.gov/disaster.
Handling Insurance Claims the Right Way
If you have homeowners insurance, file a claim as soon as possible. Your insurance company may send a check that’s made out to both you and your loan servicer.
That means:
- Your servicer holds the funds in an escrow account and releases money as repairs are completed.
- You’ll need to submit repair estimates and receipts to get the funds released.
- Keep detailed records of all your communications with the insurance company, contractors, and your servicer.
If your insurance doesn’t cover everything, check with FEMA or the SBA to see what additional help you can get.
Watch Out for Scams
Sadly, after every disaster, scammers come out of the woodwork. Stay alert and avoid:
❌ Contractors asking for full payment upfront.
❌ Fake FEMA or HUD reps calling for personal info.
❌ Companies promising “easy” loan modifications or disaster relief.
When in doubt, verify everything with your servicer, FEMA, or HUD before handing over money or personal details.
Final Thoughts
Natural disasters are stressful enough without worrying about your reverse mortgage. But if you stay in contact with your servicer, take care of insurance claims, and tap into disaster relief resources, you’ll be in a much stronger position to recover.
For more details, check out the full guide from the CFPB:
➡️ Reverse Mortgage Borrowers Impacted by Natural Disasters
And if you have questions about how your reverse mortgage fits into your long-term financial picture, reach out to our team at ZYNG Mortgage. We’re happy to help.
A natural disaster can feel like the end—but it’s not. There is always hope. One of our clients, Lelia (video below), lost her home in the Paradise fire in California. Instead of rebuilding, she used her insurance funds to find a new home and start fresh. Recovery looks different for everyone, but with the right resources and guidance, a new beginning is always possible.