THE 6.6 QUAKE : On the Rebound: A Guide to Recovery and Resources : Mortgages, Repairs and Other Practical Matters

Monday’s devastating temblor left many homeowners, buyers, sellers and renters asking questions about paying their mortgages, replacing necessities, making repairs, seeking property tax relief and other matters. Here are answers to those and other questions:

*

Q. Must I continue making mortgage payments if my house was damaged or destroyed?

A. While payments are technically due regardless of damage, many lenders are allowing customers to defer payments for several months. Bank of America, for example, will give current customers a payment moratorium of up to three months. Union Bank and Countrywide Mortgage also say they will work out deferred-payment arrangements with borrowers.

*

Q. What about paying my credit card and home equity loans?

A. Same deal. Payments are due but, if you contact your lender, you may be able to delay payments or even increase your credit line for emergency expenses.

But shop carefully and ask a lot of questions--hundreds of dollars in interest costs can hang in the balance. For instance, Bank of America will increase credit lines for its Visa and MasterCard customers who are earthquake victims. The bank is also offering unsecured lines of credit of up to $7,500 for victims.

If you take the credit card deal, you’ll pay between 16.9% and 19.8% interest, depending on whether you have the variable- or fixed-rate card. If you take the personal line of credit instead, you get a 5% loan for up to four years.

You’d pay at least $238 more, annually, for borrowing $2,000 against the credit card instead of borrowing the same amount on the credit line.

*

Q. My next property tax installment is due Feb. 10, but my house was damaged. Can I get property tax relief?

A. Yes. If you suffered more than $5,000 in home damage, contact your county assessor’s office. In Los Angeles County, that’s (213) 974-7394; in Ventura County, (805) 654-2181.

Ask for two forms--one seeking a reassessment of property damaged by “misfortune or calamity,” and another seeking a temporary deferral of payment. File both forms within 60 days of the date the damage occurred and include photographs. The assessor’s office will send an appraiser to determine the extent of the damage and reassess your home. If you’ve owned the home for a long period, however, don’t expect the reassessment to fully account for the cost of damage, said Kenneth P. Hahn, Los Angeles County assessor.

That’s because Proposition 13 has kept your property tax assessment artificially low. Assessors will prorate tax reductions based on the difference between the true market value of your home and the value for property tax purposes.

So if your house is worth $100,000 but is assessed at only $70,000 because of limitations from Proposition 13, your $10,000 lost chimney may reduce your tax assessment by $7,000--or the prorated value of the damage.

*

Q. My house wasn’t hurt by the quake, but some of my neighbors have damage. I’ve got my house up for sale. Is this going to affect its salability or price?

A. Generally, home values suffer in disaster areas for several months, partly because the neighborhood doesn’t have its usual luster.

But, assuming that your neighbors get their houses repaired, prices should bounce back up relatively soon.

If there’s no real reason why you must move in the wake of the disaster, you might want to hang on to the house a few extra months to get the benefit of the bounce.

*

Q. I’ve had substantial damage to my home, but I’m debating about repairing it now because of the constant aftershocks. If I wait, will I jeopardize my insurance coverage?

A. Not usually. The only time your insurance would be affected is if you were negligent about securing your belongings.

In other words, if your chimney fell down, exposing part of your home to outdoor weather, the insurer would expect you to seal off the opening so rain didn’t come in and cause more damage.

Other than that, you should immediately make any repairs that are necessary to ensure your safety and the safety of your family and guests.

If these repairs need to be done twice because aftershocks damaged the repairs, the insurer will pay to fix it again.

*

Q. I don’t have earthquake insurance and I had substantial losses. Can I get a tax deduction?

A. For very substantial losses, yes. But to claim a so-called casualty loss, you must have unreimbursed damage in excess of 10% of your annual income, plus $100.

In other words, if you earn $50,000 a year, you can write off only those damages that exceed $5,100.

The good news is that once an area has been officially designated a federal disaster area, you have the option of claiming your casualty loss on the previous year’s tax return.

That would allow you to get a refund processed immediately and have the money when you need it.

It also gives you the option of claiming the loss in the year--this year or last--when you would be eligible for the greatest casualty loss deduction.

If your income was lower last year than this year, for example, you would get a bigger deduction because the 10% threshold would be lower. (If you earned $40,000, you can write off losses exceeding $4,100.)

But casualty loss claims can trigger a tax audit. So keep receipts, photographs and other appropriate documentation to substantiate the claim.