Will Recent Flooding in NC Lead to a Flood of Bankruptcies?

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After North Carolina was hit with some of the hardest thunderstorms and flash flooding seen in years, thousands of residents found themselves and their homes surrounded by water. If you were impacted by the rising waters, you know the extreme devastation that these storms brought to the state on June 30. While some people lost everything, others were only left with serious water damage. Luckily, North Carolina Governor Pat McCrory recently announced that financial assistance is available for flood victims in Orange and adjoining counties.

After the flash flooding and thunderstorms left the area, there were reports of downed trees and impassable roads. On the night of the 30^th, Duke Energy Progress customers were all without electricity in the Durham area, while approximately 1,000 people were left without power in Orange County until the next day.  

Many people were literally flooded out of their own homes, hoping to find some form of refuge in a dry area. Luckily, the Triangle Chapter of the American Red Cross was quickly able to open a shelter at Smith Middle School in Chapel Hill. The school turned shelter welcomed people with special needs, along with their pets. On Sunday night, there were about 40 people who had made their way to the shelter and Red Cross officials were expecting additional occupants in the coming days.

North Carolina Governor Pat McCrory's office announced Wednesday that financial assistance is available for flood victims in Orange and adjoining counties. The governor essentially proclaimed a state disaster declaration, allowing those who do not qualify for Small Business Administration loans to seek state funds to help them recover.

While Orange was the only county that met the guidelines for SBA assistance, residents and business owners in the nearby counties of Alamance, Caswell, Chatham, Durham and Person counties will also be able to apply for federal assistance to get back on their feet.

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If you are in one of these areas, there are loans available up to $200,000 through the SBA to repair or replace your damaged home or business. If you own or rent your home, you’re also eligible for loans up to $40,000 to repair or replace affected personal property. That includes your clothing, kitchen appliances, dishes, TVs, etc. If you do not qualify for a federal loan, but do live in one of the designated counties, you may be eligible for a state grant.

So, you may be wondering about the interest rates for these loans. The rates on federal loans are thankfully low, if you are a homeowner or renter, your rates may be as low as 1.875 percent. The number of years and the loan amount will be determined by the SBA and are based on your financial condition. So, what if your finances are already in turmoil?

Unexpected Expenses and Bankruptcy

When you look at the top reasons people file for bankruptcy protection, unexpected expenses lands in the top five. Those unplanned expenses include the loss of your home or property due to a natural casualty that you weren’t insured for. Going by statistics, the flooding that occurred in North Carolina a few short weeks ago will likely cause a spike in bankruptcy filings, especially if you can’t get one of the federal loans to repair your home.

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Many people don’t know that you have to take out separate insurance coverage for disasters or events, like flooding. You generally find this out once it’s too late and your home is under water. If you don’t have insurance for flood damage, you can end up facing the loss of not only your home, but all your possessions. Then you and your family are forced to find immediate food and shelter, plus the need to replace all the items that were lost in your home. Think about it: all your clothing is ruined due to water damage and debris, how will you dress to go to work? Will that cost you your job? The whole disaster is overwhelming.

If you were already experiencing problems with massive debt before your home was damaged in the recent flooding, do yourself a favor and consult with a trusted Durham bankruptcy attorney. You’ll discover how bankruptcy laws work and apply to your specific situation. You’ll also learn how filing a Chapter 7 or Chapter 13 bankruptcy can help keep you in your home and provide you with a fresh financial start.  

Dedicated to helping residents of North Carolina find the best solutions to their debt problems. Don’t waste another day worrying about your debt. Call +1-833-627-0115 today to schedule a free initial consultation to discuss your bankruptcy options.