Things To Know About COVID-19 Loan Payment Relief
The COVID-19 pandemic situation has taken a toll on the global economy. Failing to control this situation, many developing countries are taking on debt. It is not that only the economy has been affected. This crisis caused by the pandemic situation has not spared anyone. People around the globe are losing jobs, facing salary cut etc due to ongoing crisis situation.
Many banks, credit unions, online lenders have come up to help the economy recover from the hit caused by the pandemic. Weekly unemployment checks have been provided to help people during unemployment. But as this will expire soon you would need money to sustain. Naturally, you will consider getting a loan in order to meet all the necessities.
But if you are already carrying a personal loan then you will also think about its repayment also. Due to ongoing situation, approval requirements for some of the loan lenders are going to be strict. On the other hand, there are lenders who are willing to offer low rates and small loans to help borrowers overcome financial difficulties. You just need to understand where to look for resources.
Crisis relief loan-
Crisis relief loan are basically small loan options that have been made available at specific areas. These loans can be obtained with low APR. The additional benefit of this type of loan option is that payment of loans can be postponed for the first three months.
In case of these loans, your banking history will be taken into consideration by the lender. The main focus of the lender would be to understand if applicants like you are capable of affording the loan from the current income point of view. However, if the current financial condition is not convincing then the lender will try to make sure if you was able to afford loans before the pandemic situation.
The application process is simple. It should be noted here that these loans are offered as collateral free cash and no prepayment fees would be charged for early payment. When it comes to processing, these loans should be given priority over other existing loan options.
Relaxation provided in case of credit cards-
Many banks and credit card companies are taking necessary measures to make sure consumers remain financially stable at this hour of crisis. Financial assistance in the form of waiving no sufficient fund, monthly maintenance waivers, refunds for overdraft fees etc are intended to be provided apart from assistance on loan payment.
Credit card companies usually earn from late payments and over the limit fees. Considering the current pandemic situation, some of these companies have decided not to penalize customers. Not just that! No late fees will also be charged. You will be allowed to skip payment for a month if you have other responsibilities to be taken care of.
Salary finance is one type of loan that is meant to be offered through the employer. This loan is offered once your employer makes sure about your financial condition by reviewing your credit records. Although this loan is already available before the pandemic, the loan amount is not subjected to chance upon the impact of pandemic on the economy.
Salary finance can be obtained in the form of benefits received by the employee. The human resource department will take care how this type of financing will be handed over to employees.
Financial assistance from banks-
A good amount money as much as 160 dollars has been deployed by a renowned bank between the month of April 2020 and June 2021. Many banks and financial institutions have come forward to provide financial support in order to help people overcome the crisis.
This kind of financial support fostered by well known banks can be used to tackle social, health and economic issues. Interest rates offered by these banks are low and repayment period provided for loan payment is also quite long. Adjustments made on debt service payment has a given a new direction to financial assistance provided to any poor country.
Other relief packages for COVID 19-
Apart from taking care of cleanliness in the working area, disinfecting high touch areas from time to time, offering hand sanitizer to bank branches and to regular cleaning of ATM surfaces, banks and financial institutions are also taking measures in the form of relief services.
To keep consumers motivated and hopeful, giveaways which usually convert into free money are offered in order to keep consumers going. One can search online and review websites to make sure about eligibility to qualify for various financial assistance programs. All what is needed is to answer few questions based on which the applicant will be informed about financial programs that he or she can opt for.
Relief check of $1,200 provided to consumers who are earning less than $75,000 is one the remarkable move by the government. Not only this! If you are someone who is unemployed or lost the job due to the COVID situation then you can take advantage of unemployment benefits. This monetary assistance acts like a boon for someone like you who is unable to work due to illness or have been quarantined because of the COVID situation.
Moreover, no early withdrawal penalty will be charged if you take out money from your retirement fund. Those who qualify will be able to withdraw certain amount of money as specified by the government.
For people who have been kept inside their home for at least two months in the name of quarantine measures, paycheck protection program is a reason of relief amidst all the difficulties. The decision to lockdown the country comes as a shocker for delivery services, restaurants, theme parks, shopping malls etc as this type of services need presence of live audience to make money. Paycheck protection program sets apart itself for various reasons. It could be with rules coming up to govern loan forgiveness life has become somewhat easy for employees suffering due to the COVID situation.
Special measures for big companies having more than 500 employees have been taken. These companies being severely distressed are going to receive large grants or loans to recover.
Hospitals that were hit hard due to the pandemic can take advantage of the stimulus bill. As per the bill, these hospitals can get help of $100 billion. This money is meant to be used to buy protective gear for health care workers, testing supplies and to support emergency operation centers.
Community health centers and public health agencies will also be provided with financial help so that people are prepared to face upcoming crisis. Workers in smaller business are provided help through a special act that help them get sick leave in order to take care of their families. Businesses which are having more than 500 employees don’t come under this act.
This act is mainly intended for companies which have less than 500 employees. In return these companies will also get a tax credit on the upcoming year’s tax bill. This will balance the cost provided by these companies to their employees.
One can expect to get two weeks of paid sick leave over 100% of normal salary. But you need to make confirmation about your eligibility after checking with human resource department of your company before you start. In order to be eligible you need to show that you have worked at least for 30 days as employee of this company. It should be noted here that nursing home, health care providers, hospital are exempted from this law.
To help you deal with the financial crisis that has been caused due to COVID 19, the Income Tax Department has agreed to give you extra three to file your income tax. This is applicable only if you are yet to file your income tax. So, you will get additional time to focus on other significant financial issues. For refund, you are free to file anytime.
A great relief for students is definitely no interest for student loans till a specific duration. The best part is that no penalty will be imposed for suspension of the payment. You just need to get in touch with your service providers in order to suspend payments by enrolling in the forbearance program.
Considering the fact that small businesses will also going to face impact of this pandemic situation, small business administration has decided to provide low interest capital loans to small businesses and other non-profit agencies those who are affected by COVID 19
When making payment is your concern-
With lenders allowing late payments, lowering interest rates, you might feel overwhelmed while choosing the right lender. There are lenders who offer temporary payment holiday that could extend up to two months for payment. But you must know that during this period, the interest will accrue.
You can opt for single month skip a payment program which as per the name will let you skip payment for one month. But in this case, the interest rate will not accrue. You can also find banks which let you make late personal payment. No late fees will be charged till 180 days from the time you have enrolled for the program. After completion of 180 days, you can make a lump sum payment in order to balance the deferred payment. You can also get ready to enroll for a new extended repayment term.