Many Americans are struggling financially in the midst of a coronavirus outbreak that has upset the U.S. economy – and they may be wondering what they should do if they are having a difficult time meeting some of their regular financial obligations.
As previously reported by FOX Business, 18 percent of Americans said someone in their household had been laid off or had hours reduced due to the coronavirus outbreak, according to a recent NPR/PBS NewsHour/Marist Poll of 835 adults. Those numbers could get worse as the virus spreads and more governments take measures to limit person-to-person contact.
The first thing you can do if you anticipate having trouble making a payment is to talk to someone.
“The best advice is really to get in touch with your lenders and other creditors and advise them of your situation,” Greg McBride, chief financial analyst at Bankrate.com, told FOX Business. “There are a lot of options on the table if you’re proactive and reach out. Not so much if you fall behind and they have to track you down in two months.”
McBride noted that a lot of lenders are allowing distressed consumers to skip a payment without being charged late fees or being considered delinquent.
Some utility companies – including ConEdison in New York – have suspended shutoffs over nonpayment. Most credit card companies are also offering relief to customers in the form of hardship programs and other payment options.
And for those looking to prioritize what bills to pay, McBride noted that mortgage and car payments – typically two of the biggest components of the average household budget – could also be the two classes of lenders most willing to work with you on a financial solution.
Lawmakers and the Trump administration are taking a number of steps to aid Americans during this unprecedented time. For example, they are advancing a measure to dole out direct cash payments to many American households. Lawmakers are also looking to put a four-month moratorium on negative credit reporting and increase unemployment insurance checks. The IRS is allowing certain eligible individuals and businesses to defer tax payments. The White House has said it is working on a $1 trillion relief package to help not only families but small businesses, too.
McBride cautions that people should not rely on these efforts when thinking about how to shore up their finances. Not only will some of the payments or measures not take place immediately, they are also not designed to replace dollar-for-dollar amounts lost due to lost work or furlough.