As if we didn’t have enough problems simply holding onto our sanity during a global pandemic, those out of work now face another worry: declining credit scores.
As bills pile up, it’s no surprise that many will find their credit ratings at peril. Fortunately, lenders know this is a trying time for all and may offer some leniency.
“If you have trouble paying your bills, or loans, or paying on time, there may be a number of options to help, especially if you reach out early to your lenders or creditors,” notes the Consumer Financial Protection Bureau (CFPB). The CFPB has been urging financial institutions to work with their customers during this troubled time.
“If you can’t make a payment now, need more time, or want to discuss payment options, contact your lenders and servicers to let them know about your situation. Being behind on your payments can have a lasting impact on your credit,” says CFPB.
- The CFPB advises those worried about falling behind in payments to check lenders’ and other creditors’ websites to see if they offer updated information on various accommodations they are making currently. For example, they may be waiving fees for ATM machines, overdrafts and late fees, “as well as allowing you to delay, adjust, or skip some payments.”
- Don’t hesitate to contact your lenders and explain your situation. They will likely ask you about: your financial and employment situation, including income, expenses and assets; how much you can afford to pay; when you’re likely to be able to restart regular payments.
- Consider asking for help from a reputable credit counseling organization. These are generally nonprofit. Avoid any organization that asks for a fee up front.
- If you’re an older adult, you may be affected by the disruption differently than others. CFPB suggests visiting benefitscheckup.org to see if you quality for any state or local assistance.
- Younger people should take note that payments on student loans from the federal government have been postponed without interest until September 30, 2020
For more detailed information from CFPB, click here.