We hope this message finds your family adjusting to our (temporary) new normal and that you are uncovering some peace in this slowed pace of life. Here at The Nelson Team we are staying focused on the fact that this is temporary, and we will soon return to our old routines, likely with a renewed appreciation for the ordinary day. In the meantime, we realize there is a lot of information being communicated and can make it difficult to know where to focus our energies. To be a resource to our clients and friends who are experiencing financial hardship we put together a list of action items for you to consider to ease your burden. We encourage you to seek assistance as soon as possible and want to point out that most of the below programs are not automatic, they are only available upon request, so please take action!
Also, in any of the below suggestions, be sure to ask the financial institution if/how taking advantage of available options will impact your credit. In most cases they will not, but be sure to clarify so you can prioritize which programs are best for you to pursue:
Contact your mortgage servicer – the lender you send a check to every month –to see if you qualify for mortgage forebearance. Forebearance assists borrowers who are unable to make their monthly mortgage loan payment as a result of a temporary hardship. Many servicers allow mortgage payments to be reduced or paused for a period of up to 12 months, depending on the circumstance. The relief can apply to any type of property: primary home, second home or investment properties. Note that this is not a forgiveness of debt, once you recover financially (or the forebearance period ends) you will work with the lender on a repayment plan, which might include extending the term of the loan. Be sure to ask about interest as usually it will continue to accrue during the forebearance period so it is to your benefit to resume payments as soon as you are able.
Visit your credit card company websites and read their response to their customers financial concerns. If you need temporary assistance for your personal or business accounts typically you can request this online. If you don’t find what you need online, call the customer service number on the back of your card to speak to a someone live but expect long wait times as the companies are overwhelmed with calls. Below is a summary of what some credit card companies are offering:
Waiving interest accrual or setting interest at 0%, lowering minimum payments, deferring payments, waiving late payment fees, increasing credit lines (dependent on credit worthiness)
Before you take advantage of any of their programs ask if this will have any effect on your credit report AND ask if the line of credit will still be available to you. Some cards are freezing the line of credit so if you need access to these funds, proceed with caution.
If you are unable to find relief with your current issuer and you have a good credit score, consider applying for a 0% interest credit card to consolidate debt from other cards onto.
Several automakers and banks are currently offering payment deferrals for customers experiencing financial hardship. Reach out to your lender to see what they can offer.
As well many manufacturers and financial institutions are incentivizing new car purchases with 0% interest on terms up to 84 months with the first few months of payments deferred, so if you are in the market for a new car, now might be a good time to buy.
Federal Income Taxes
The deadline to file Federal AND Colorado State income taxes has been extended to July 15 for all individual returns, trusts, and corporations. This relief is automatic, taxpayers do not need to file any additional forms or anything to take advantage of this extension.
Borrowers with Federal student loans are able to pause those loans until September 30 and interest has been reduced to 0%. Lenders will not be garnishing wages, Social Security and tax refunds for student loan debt collection for those in default. If you have Federal student loans this IS automatic and you do not have to do anything. If you have private student loans contact your loan servicer and ask if they have programs to help. Note, if you are able to continue making your payments as usual, you will pay less in the end.
Contact all of your utility companies as many offer energy bill assistance programs which may allow you to defer payments until a later date.
Other General Banking
If you have seen other fees or charges show up on your general banking accounts, reach out to them as many banks are waiving overdraft, non-sufficient funds, monthly maintenance, expedited check, debit card, excessive transaction fees.
Other Financial Commitments
Our other advice is to look through your credit card and bank statements to find things that can be temporarily suspended in order to save money – gym memberships, monthly subscriptions, reduce cell phone data plan, etc.
This information is changing daily so best option is to reach out to your lenders and ask for help but as always we are a phone call away to talk through any of these options with you! Stay well friends!