How Do I Deal With Debt From the Pandemic?

 

What is something that many people are dealing with while finances are being heavily affected by COVID-19? Debt.  

 

If you are in a financial struggle right now due to the pandemic, take a look at these 5 tips to start you down the road to recovery: 

 

1. Speak to Your Creditors 

Numerous creditors, including mortgage servicers, car loan providers, and credit card businesses are offering assistance to individuals financially influenced by the pandemic. It never hurts to reach out to your creditors to see if they can offer you any leeway. 

 

2. Paying Your Rent 
   

   Paying your property owner ought to be among your top priorities if you are renting a home. Unlike mortgage lenders, most landlords cannot weather a loss of rent money, meaning if you cease making your payments, you will likely be evicted. With that being said, having a discussion with your property manager may get you some extra time. 

 

3. Making Car Payments 

Automobile payments should also be towards the top of your priority list. Nationwide car loan servicers can be more lenient about payments than landlords, but they cannot forgive forever. After missing a few payments, you may face repossession of your vehicle. It’s always best to contact your loan servicer before you miss a payment to either ask for an extension or at least tell them that you have to make the payment late and let them know when to expect it by. 

 

4. Mortgage Payments 

Fortunately, mortgage payments offer more flexibility than other types of loans. Of course, you cannot go and skip a bunch of payments, but what you can do is get the terms of your loan adjusted. Your mortgage lender can work with you and possibly reduce your interest rate or put your missed payments back into your existing loan. 

 

5. Credit Card Debt 

Credit card companies and other unsecured loan providers are typically the most aggressive debt collectors. However, they should be among your lowest priorities when it comes to your monthly payments. If you miss payments, they will likely sue you and try to take money from your bank account and paycheck, but if you are out of work due to COVID-19 and do not have money in your account, they will be unsuccessful in these efforts. If you own a house, they can place liens against your home, so that is something to be careful of. Either way, if you are in a financial pickle, speaking to a debt relief attorney can be a great idea to help you come up with a good strategy to deal with your debt.