Greensboro, NC -- Even without the government shutdown, the Triad is all too familiar with furloughed employees, workers having their paychecks delayed, and immediate layoffs.
Dolores Hill, a certified financial educator with Financial Pathways of the Piedmont walked us through the steps you should take if you find yourself suddenly laid off without a paycheck.
She says, first prioritize the bills for the things you need most: rent/mortgage, utilities, food and insurance. But as money gets tight, which bills do you pay first versus pay late? And if you do pay a bill late, which ones will hurt your credit score most?
"Monthly expenses such as mortgages, credit cards and personal loans are typically reported to the credit bureau on a monthly basis. Your credit report will reflect if you paid creditors on time "as agreed" or if you paid any of these late (30/60/90 days). "
When it comes to utility bills, if paid after the "due date" there will be a "late fee" that will you will incur as a result. With utilities, cable/satellite, and cell phone expenses, there is not a monthly reporting to the credit bureaus.
Hill says as soon as the layoff or furlough happens, contact all creditors and inquire if there are any deferment/hardship programs. One option is to request to be placed on your lender's hardship program, which will re-age the account and lower your monthly payments. Many lenders offer these types of programs, including mortgage companies and credit card companies.
"When you write the letter for the hardship program, explain what has caused you to fall behind on your payments, whether it's temporary or permanent, and what type of assistance will be helpful to you (e.g., a change in interest rate). Explain that you do not want to default, and that you are eager to work things out."
Hill says the worst thing you can do, is wait. Hope for the best, but prepare for the worst immediately.
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