Credit Cards, Credit Counseling, Debt, Debt Consolidation, Debt Settlement, Finance, Loans, Money Management, Mortgage, Student Loans

Protect Yourself Financially from the Impact of COVID-19

By: Consumer Financial Protection Bureau (CFPB)

Steps to take if you have trouble paying your bills or meeting other financial obligations

If you have trouble paying your bills/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, loan servicers, and other creditors

If you’re not able to pay your bills on time check their websites, to see if they have information that can help you.

The CFPB and other financial regulators have encouraged financial institutions to work with their customers to meet their community needs.

If you can’t make a payment now, need more time, or want to discuss payment options, 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.

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, overdrafts, and late fees, as well as allowing you to delay, adjust, or skip some payments.

When contacting your lenders, be prepared to explain:

  • Your financial and employment situation
  • How much you can afford to pay
  • When you’re likely to be able to restart regular payments
  • Be prepared to discuss your income, expenses, and assets

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.

Warning: If you’re considering working with a debt settlement company to address your debts, be skeptical of any company that promises to do it for an upfront fee.

Trouble paying your mortgage?

If you can’t pay your mortgage, or can only pay a portion, contact your mortgage servicer.

It may take a while to get a loan servicer on the phone. Loan servicers are experiencing a high call volume and may also be impacted by the pandemic.

Visit our blog on mortgage relief options for in-depth content to help you understand your forbearance options and avoid foreclosure in light of the coronavirus and the recently passed Coronavirus Aid, Relief, and Economic Security (CARES) Act.

If you are renting from an owner who has a federally backed mortgage, the CARES Act provides for a suspension or moratorium on evictions. Read more in our renter section of the mortgage relief blog.

Trouble paying your student loans?

If you have student loans, you have options.

If your loan is held by the federal government, your loan payments are postponed with no interest until September 30, 2020.

For other kinds of student loans (such as a federal student loan held by a commercial lender or the institution you attend, or a private student loan held by a bank, credit union, school, or other private entity) contact your student loan servicer to find out more about your options.

Read our FAQs to learn more about what you can do.

Trouble paying your credit cards?

If you’re unable to pay your credit cards, talk with your credit card company and let them know that you cannot make a payment. You may get relief.

You may also want to work with a credit counselor. Reputable credit counseling organizations are generally non-profit organizations that can advise you on your money and debts, and help you with a budget. Some may also help you negotiate with creditors. There are specific questions to ask to help you find a credit counseling organization to work with.

Trouble paying your auto loan?

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

How to work with your bank or credit union

With many of us staying home to help flatten the coronavirus curve, online banking allows you to handle your finances from the comfort of home. Here are some tips for people who are new to online or mobile banking.

Generally, all bank deposits up to $250,000 are insured by the Federal Deposit Insurance Corporation. Deposits at all federal credit unions, and the vast majority of state-chartered credit unions, are also insured up to $250,000 by the National Credit Union Share Insurance Fund (NCUSIF).

How to work with debt collectors

If you currently have a debt in collections, you can work with collectors to identify a realistic repayment plan.

The Bureau offers a number of resources for contacting and negotiating with debt collection companies, especially as we deal with the impact of the coronavirus.

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.

You can look to your state’s unemployment policies to identify current options for benefits. The recently passed CARES Act allows states to extend benefits to self-employed and gig workers, and to provide an extra $600 per week as well as an additional 13 weeks of benefits. Your state’s public health office may also have information.

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.

Click here for more information on scams specific to the coronavirus.

The Federal Trade Commission has tips to protect yourself from possible coronavirus-related scams. The FTC and the Food and Drug Administration have also cautioned consumers to be on the look-out for sellers of unapproved and misbranded products, claiming they can treat or prevent coronavirus.

Learn more about how to prevent, recognize, and report fraud and scams.

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Debt

How to tell the difference between a legitimate debt collector and scammers

By: CFPB

Dealing with debt collection issues can be challenging—especially when you’re not sure if the person you’re being contacted by is legitimate or trying to scam you.

When an account like a credit card, auto loan, or cell phone bill becomes past due, the original creditor may attempt to collect the amount owed. The creditor may also hire a debt collector or sell the debt to someone who may try to collect the debt. While there are many legitimate debt collectors in the financial marketplace, there are also scammers who may try to get you to pay on debts that you don’t owe or on debts that don’t even exist.

Warning signs of debt collection scams

1. Withholds information from you

A debt collector must tell you information such as the name of the creditor, the amount owed, and that if you dispute the debt, the debt collector will have to obtain verification of the debt. If the debt collector does not provide this information during the initial contact with you, they are required to send you a written notice within five days of that initial contact.

2. Pressures you to pay by money transfer or prepaid card

Scammers like these payment methods because they may be untraceable, and it can be hard for you to get your money back.

3. Falsely threatens you with jail time or poses as a government official

But beware, if the debt comes from the criminal justice system, it is possible that failure to pay may result in your arrest.

4. Says they will tell your family, friends, and employer 

Some scammers may try to get you to pay by threatening to reveal your debts to family, friends, coworkers, or employers. A debt collector is generally not allowed to tell other people about your debt without your permission. They can only ask others about your whereabouts to try and contact you.

5. You don’t recognize the debt that the person claims you owe money for

Ask questions to make sure the debt is one that you owe.

6. Asks you for sensitive personal financial information

Such as your bank account, routing numbers, or Social Security numbers. You should never provide anyone with your personal financial information unless you are sure they’re legitimate. Scammers can use your information to commit identity theft.

7. Calls you at inconvenient times

Debt collectors cannot call you at an unusual time or place or at a time or place they know is inconvenient to you. You might be dealing with a scammer if you are called before 8 a.m. or after 9 p.m.

Learn how to protect yourself

1. Ask for a callback number

If you’re uncomfortable providing any information, you can request the caller’s name, company name, street address, and a callback number. You can use this information to verify that they are not a scammer before providing any personal information. Also, if you call back and the business doesn’t answer as the name they provided to you or it’s a nonfunctioning number, it could be a scam.

2. Make sure you have been given information about the debt before you pay

Make sure you have been given information or have received the written notice with information about the debt before you pay anything.

3. Contact your original creditor

If you suspect you are dealing with a scammer, contact the creditor the debt collector claims to be working for and find out who has been assigned to collect the debt.

4. Check your credit report for the account in question

You are entitled to a free credit report every 12 months from each of the three major consumer reporting companies. To get your free credit report authorized by law, go to AnnualCreditReport.com or call (877) 322-8228. Keep in mind that not all debt collectors and creditors provide information to the credit reporting companies. If the debt is not on your credit report, that does not necessarily mean the debt is not valid.

5. Understand your rights

The Fair Debt Collection Practices Act prohibits debt collectors from engaging in a variety of practices, such as misrepresenting the debt, falsely claiming to be a lawyer, or using obscene or profane language when trying to collect a debt.

6. Submit a complaint

If you have received a suspicious call or think you’ve been the victim of a debt collection scam, you can submit a complaint with the Federal Trade Commission or you can contact your state Attorney General’s office.

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Budgeting, Christian Credit Counselors, Credit, Credit Cards, Credit Counseling, Debit & Your Credit Score, Debt, Money Management, Saving

Debt Collectors: Know Your Rights Against Wrong Practices

Doomsday Debt Collectors debt1

Debt collectors may be within their right to pursue repayment, but you should know how to protect yourself against doomsday debt collectors and their extreme tactics.

Fair Debt Collection Practices Act

First, you should be aware that there are laws in place that govern the practice of debt collection. The Fair Debt Collection Practices Act was written for your protection and is enforced by the Federal Trade Commission, our national consumer protection agency. This Act covers a variety of debts, including personal and household, but not business debt. Examples of covered debts are: home, auto, medical, and credit card debt.

The Facts about Debt Collectors

  • May not use abusive or deceptive tactics
  • Must send the debtor a validation notice within 5 days of initiating contact
  • Written validation notice must include: amount owed, the creditor to whom money is owed, and what to do if the debtor says they don’t owe
  • Must contact during reasonable hours (Ex. not earlier than 8 a.m. or later than 9 p.m.)
  • May not attempt contact at a person’s work (with a written or oral statement)
  • May contact third parties for a person’s contact info (often limited to one time)
  • Must contact your attorney, if you are being legally represented
  • May not discuss the details of the debt with those outside of the debtor, debtor’s spouse or representing attorney
  • Must stop contacting the debtor upon receipt of a written notice by debtor indicating the debt is not owed or seeking proof (within 30 days from date of validation notice)
  • May continue to contact the debtor once proof of debt has been provided

Putting a stop to Debt Collection

Your first conversation with a collector should be an attempt at resolution. Determine whether you owe the debt. Depending on the outcome of that initial conversation, decide how you will proceed. If you want to stop a collector from contacting you, provide it in writing. Be sure to make a copy of everything you send and mail the document by certified mail with a return receipt. From that point, the debt collector may tell you that there will be no further contact, or they may indicate their next step. If a creditor still wants to collect from you at this point, they may pursue legal action by filing a lawsuit.

In the event that you are sued by a debt collector, respond or have your lawyer respond by the date indicated in the lawsuit to stay within your rights.

Reporting Debt Collection Misconduct

Notify the Federal Trade Commission and the Consumer Financial Protection Bureau of a debt collector who doesn’t operate within the bounds of the law. Additionally, inform your state Attorney General’s Office, and inquire about the state laws that differ from the Fair Debt Collection Practices Act, as well as, your rights.

Christian Credit Counselors is a non-profit organization that was created to help individuals and families regain control of their finances through the use of educational tools, credit counseling and other resources. For more resources, visit www.christiancreditcounselors.org.

Do you want to know more about debt and how you can make smart financial decisions now that will help you secure a more prosperous financial future? Sign up for our newsletter for monthly money tips.

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