The images of destruction coming out of the communities in Oklahoma impacted by the recent tornado are downright scary and our thoughts and prayers go out to the people who have been affected by this terrible storm.
It seems like no matter where you live in the U.S. there is always some level of risk associated with random acts of mother-nature. Tornadoes in the mid-west and south, snow blizzards in northern states, hurricanes in the south and along the eastern seaboard and earthquakes on the west coast!
While the impacts of such events are often devastating, advances in technologies to predict them in advance and education on how to prepare in advance likely saves hundreds of lives each year.
So what should you do to protect yourself and monitor any changes to your credit score if you’ve been impacted by a natural disaster and are worried about keeping up with your bill payments as you sort things out and try to get some “normalcy” back into your life?
If you reside in a natural disaster area and find you can’t pay your bills on time, contact your bank and other creditors as soon as possible to make them aware of your situation.
Most lenders have “natural disaster” procedures in place to work with their customers impacted by such unforeseen events. For example, many lenders will work with you to set up a temporary deferred payment plan, or temporarily place the loan in forbearance (meaning you may get temporary relief from having to make full payments on your credit obligations). Each lender is different, so contact all of your lenders.
The lender may include comments about any special payment arrangements set up because of a natural disaster when they send an update to the credit reporting agencies. The FICO Score does not consider such comments as negative information when calculating the score.
It may be prudent to obtain a copy of your credit report and score as soon as is feasibly possible after the disaster. This will give you a complete picture of your credit profile at the time of the natural disaster and before any post-disaster updates have been reported.
At www.myFICO.com, you can get a copy of your FICO Score and credit report explanation with the option to print off a hard copy or save as to your desktop. You may be able to leverage this information as you recover from the event.
Tom Quinn is the Vice President of Business Development for myFICO, and has over 20 years of experience working with consumers, regulators and lenders and regarding credit related questions and initiatives.