Can your credit card company defer payments due to Covid-19?

Can your credit card company defer payments due to Covid-19?

We are all being affected by Covid-19 in some way. 

Maybe you’re not able to work or you are struggling to pay for childcare when the schools are closed.

Perhaps you are dealing with mounting medical bills.

For whatever reason, you are struggling to pay the credit card, the car loan, or the mortgage. 

While going through these uncertain times, be sure to keep the following things in mind. 

NOTE:  We recorded this video right when COVID hit hard.  Now there are programs under the CARES Act which can be helpful.  And tomorrow there may be a new law.  But the point is to always verify the information and protect yourself.

Don’t fall for any scams. 

Be careful. 

You may get a phone call from someone claiming to be with your bank saying, “We want to waive your payments for the next four months till everything settles down. We will just need your social security number, account number, date of birth…”

Take a step back. Tell them you are calling the number on the back of your credit card to be sure. Ask the caller which department you should speak to. 

They may be a reluctance to give you this information. 

They will say this is a one time offer and how you can’t call in to receive it. 

This is a scam.

Second, understand that if a CEO or other prominent figure goes on CNN and says they are taking measures to help their customers – this statement is not binding on them. 

If you need help, pick up the phone and call your company and talk to them about your specific situation. 

Make sure you clearly understand what they are saying. 

For instance, they may say you can defer your payments for 60 days. 

Great! But what does this mean?

Ask them plainly, “What will you report on my credit report?” 

Pin them down and get an answer from them. 

Many of these places record their calls. If this person tells you that you can skip your March and April payments and not be reported as late on a recorded call, then you have proof. If you are reported as late, you have the basis for a dispute through the credit bureaus. 

Be sure to protect yourself. 

Make sure you know exactly what the program is that they are offering you and what the consequences will be. 

Is it that you skip March payment, skip April payment, then pay 3 months’ worth of payment for May?

Do you skip March and April and make one normal size payment in May? 

Will you be reported late? 

They can choose how to report you. They can report as “No data” or they can report you as being current because you’re not late if they say you don’t need to make a payment. 

Understand exactly what you’re doing. 

If you’re dealing with an organization to help with your mortgage and loss mitigation, this will be a more formal process than dealing with the typical credit card company. 

Turn to wherever you need to turn to to get help and get through this. 

If your choice is to take care of some payments or be able to buy food and take of your kids, you do what you need to do to take care of your family. Deal with the consequences later. 

Stay safe. Take care of yourself. Take care of your family. 

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Thanks and have a great day!

John Watts