With the Corona-virus pandemic sending millions of Americans scrambling to make ends meet, another type of economic fallout is bubbling in the background: consumers’ worsening credit status due to late or unpaid bills. But making a bad situation worse, some credit scores are being mistakenly dinged by the very lenders that, thanks to the protections of the Corona virus Aid, Relief, and Economic Security Act passed in March, are supposed to be providing payment relief. The law lets you postpone payments on federally backed mortgages for up to a year, suspends all payments on federal student loans through Sept. 30, and—supposedly—ensures that your credit isn’t negatively affected if you take advantage of these provisions.
Reports of people whose credit scores are nonetheless wrongly being harmed keep piling up. Reports from consumers who say their credit scores dropped when they accepted—and in some cases merely inquired about—COVID-19-related mortgage forbearance, a direct violation of the Corona-Virus Relief Law.
A new bill in the U.S. Senate would, if passed, prevent any negative information from appearing on consumer credit reports during the crisis. “Consumers need broad relief during the COVID-19 crisis and shouldn’t see their credit scores penalized during an economic disaster,” says CR policy analyst Syed Ejaz. “Fixing these mistakes on a case-by-case basis isn’t enough. Both credit bureaus and lenders should suspend all negative credit reporting. The Disaster Protection for Workers’ Credit Act of 2020, a Senate bill sponsored by Sen. Sherrod Brown, D-Ohio, does exactly that.” Until then, the good news is that consumers now have the expanded ability to monitor and to some extent police their own credit reports.
We see many clients struggling to find answers to these questions and finding it difficult to navigate through the hardships they are facing. Credit Services of America has the resources and the expertise to help you avoid falling into the Trap of accepting whatever is being reported on your credit. Today more than ever it is imperative that you stay on top of your credit as it will bail you out of a cash-strapped situation. We at Credit Services of America have been helping people for over 9 years doing just that, giving them the ability to recover from a bad credit profile and helping them save money through a variety of ways such as lower APR rates. By having good credit, you can lower most
Menu