Advance America Answers: What Does the Stimulus Bill Do to Protect Your Credit?
NEW YORK, April 29, 2020 (Newswire.com) - April 29, 2020 (Newswire) -For so many Americans, our financial future looks unclear right now. Almost 20% of all working people have lost their jobs or seen their hours cut back. If you’re one of them, you’ve probably wondered if this pandemic could have a long-term impact, such as giving you seriously bad credit.
Luckily, the stimulus bill does have some protections for your credit. In order to protect your financial wellness, make sure you know your rights and do everything you can to maintain — or even improve — your credit.
Reach Out to Your Lender
The new credit protections will only cover you if you take action. You have to reach out to your lender and work with them to change your loan payment plan — and if you owe money to multiple lenders, you have to call each one individually. That means a lot of time waiting on the phone, which can be frustrating, but it’s worth it to avoid bad credit.
If you’re intimidated or afraid to ask for the help you need, don’t be. Lenders don’t want you to default, and they know that so many people’s lives have changed in only the past month. They appreciate when borrowers are proactive about making sure they can stay current.
Once you’ve set up a new agreement, it’s protected under the new act until 120 days after the end of the state of emergency.
You Can’t Face Foreclosure — Depending On Your Lender
If you have a mortgage backed by the federal government, you can’t face foreclosure for 60 days as of March 18. You can also ask for 180 days of forbearance, which means you might be able to pause mortgage payments for as much as half a year.
Only federally-backed mortgages are part of the large relief bill known as CARES (Coronavirus Aid, Relief and Economic Security Act), but states including California, Connecticut and New York have set up their own protections. Make sure to check out where your state stands on mortgage relief and other forms of aid.
Understand Your Credit Inside and Out
Changing circumstances are a great time to sit down and take a hard look at your budget. Before you make big decisions, be sure to know how credit works, and what actions can improve your finances — or damage them.
Knowledge is power when it comes to the long-term effects of the choices we make during a moment of crisis. Whether you’re thinking about taking out a personal loan or opening a new credit card, stay aware of how your choices can damage your credit report in a way that lasts well after 2020.
Source: Advance America
