Federal, state, and local governments are working to respond to the growing public health threat of coronavirus, or COVID-19. As communities across the country are dealing with an increase in the number of reported cases, many areas may be impacted by the temporary closure of businesses, schools and other public facilities or events, and in some cases, quarantines. While these actions are necessary steps to help reduce exposures, it may bring financial uncertainty for many people who could experience a loss of income due to illness or workplace closures.
Steps to take if you have trouble paying your bills or meeting other financial obligations
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.
Contact your lenders and loan servicers
If you’re not able to pay your bills on time, 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. The CFPB and other financial regulators have encouraged financial institutions to work with their customers to meet their community needs.
Credit card companies and lenders may be able to offer you a number of options to help you. This could include waiving certain fees like ATM, overpayments, and late fees, as well as allowing you to delay, adjust, or skip some payments.
When contacting your lenders, be prepared to explain:
How much you can afford to pay
When you’re likely to be able to restart regular payments
In the case of mortgages, be prepared to discuss your income, expenses and assets
If you are having troublepaying your auto loan payments your lender may have options that will help. Our tips include changing the date of your payment, requesting a payment plan, and asking for a payment extension.
If you havestudent loans, you may qualify for a delayed or reduced payment program. Just remember, even though you don’t need to make payments now, interest will continue to accrue, and you will have to make up these amounts eventually. Contact your student loan servicer to find out more about your options. If you have a federal student loan, also ask your servicer about alternative repayment plans.
Work with housing and credit counselors to understand your options
These trained professionals provide advice for little or no cost, and they will work with you to discuss your situation, evaluate options, and even help you negotiate with your lenders and servicers.
HUD-Approved Housing Counselors. The U.S. Department of Housing and Urban Development (HUD)-approved housing counselors can discuss options with you if you’re having trouble paying your mortgage loan or reverse mortgage loan. This may also include forbearance or a modified payment program.
If you’re working with lenders on payment assistance programs or forbearance, routinely check your credit reports to make sure the statements are accurate and that any delinquencies have not been improperly reported. Your credit reports and scores play an important role in your future financial opportunities.
What to do if you lose your income
State and local governments vary in the programs and offerings to help those financially impacted by the coronavirus.
Older adults may be impacted by the coronavirus and quarantine procedures in different ways than the general public. There may be government benefits available to older adults who need financial help. Visit benefitscheckup.org
for more information and to see if you qualify for any state or local assistance.
Be aware of potential scam attempts
Scammers look for opportunities to take advantage of the vulnerable, especially during times of emergencies or natural disasters. Be cautious of emails, texts, or social media posts that may be selling fake products or information about emerging coronavirus cases.
Scammers often target older adults because they may have more assets or regular income in the form of retirement benefits or savings and because they’re often more polite and trusting than other age groups. As older adults are at a higher risk
for serious illness they may also be isolating themselves.
Social isolation is already an issue for older adults and can lead to a host of issues, including an increased likelihood of falling for scams due to a need to connect to others. This issue could grow in response to virus prevention tactics like social distancing and quarantines. Phone calls and video chats can help older adults and their families connect during this period where health officials encourage limiting contact.
If you have a problem with a financial product or service, try reaching out to the company first. Companies can usually answer questions unique to your situation and more specific to the products and services they offer. We can also help you connect with the company if you have a complaint. You can submit online or by calling (855) 411-2372. Companies generally respond within 15 days. The company may contact you directly to confirm information provided in your complaint before it responds. In some cases, the company will let you know their response is in progress and will provide a final response within 60 days.
I want to warn everyone that listening to those who benefit by our ignorance are asking for trouble. Avoid anyone who sells a ‘magic potion’ to protect you from the virus, or a way to avoid paying your mortgage and still keep your home.
Of course, there are resources (see the article above for legitimate links to several). Trust only the sources that will not financial benefit if you follow their advice and that are qualified to give that advice. That does not mean every government resource is trustworthy, but use your common sense and trust qualified doctors for your medical advice.
Diane is a well respected Arizona bankruptcy and foreclosure attorney. As a retired law professor, she believes in offering everyone, not just her clients, advice about bankruptcy and Arizona foreclosure laws. Diane is also a mentor to hundreds of Arizona attorneys.
*Important Note from Diane: Everything on this web site is offered for educational purposes only and not intended to provide legal advice, nor create an attorney client relationship between you, me, or the author of any article. Information in this web site should not be used as a substitute for competent legal advice from an attorney familiar with your personal circumstances and licensed to practice law in your state. Make sure to check out their reviews.*
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