Debt and creditors are stressful enough, add to that the Coronavirus pandemic and the stress to many Americans is overwhelming. Do not worry because there are some easy steps that we can all take to help alleviate this financial stress and negotiate to lower the monthly burdens of our debt.
- Inquire about a forbearance/deferment
The CARES Act mandated that federally funded student loans and all mortgage borrowers be afforded forbearances and deferments. To take advantage of this student loan borrowers need to do nothing but mortgage borrowers need to contact their lenders and state that they are suffering a hardship. The great thing about the CARES Act is that it eliminated the need for a mortgage borrower to prove this hardship with documentation.
These two types of forbearances and deferments are mandated, however, other types of creditors are willing to defer payments during this time. Many car financing institutions are offering 3 and 6 month deferments on payments and many utility companies and insurance companies are working with customers to offer similar accommodations. All you have to do is call your creditors and explain your situation. These creditors want their money and will work with you to ensure they will get it.
- Request a hardship/varied interest rate
Most credit card issuers have hardship programs that are available during disasters and times of crisis and this pandemic definitely qualifies. The hardship assistance can include higher credit limits, waived fees and extended payment deadlines. Just call your creditor and inform them that you would like to know what hardship assistance they can offer you.
Most credit card companies will also consider lowering the interest charged on your current balance. Many Americans are having trouble paying their credit card bills and credit card companies will work with you if you pay your bill. American Express has even stated that if a cardmember was impacted by this pandemic they will reimburse interest charges. All you have to do is CALL and be HONEST about your situation!
- Cancel/Pause Memberships, Subscriptions and Other Unused Credit
Now is the time to take stock of your monthly memberships, subscriptions and other monthly charges and determine what you are not using. If you have a gym membership or other club membership that you cannot use because of the pandemic, Cancel it! If you are a season ticket holder or belong to some other ticket program and can’t use them because of the pandemic, Cancel them! If you do not want to cancel, call your companies and request a pause in your payments but whatever you do do not continue to pay for services you cannot use right now. If your creditor tries to charge you for canceling, you fight it because every contract is cancelable when one party cannot perform.