What Companies are Offering Disaster Relief Programs for their Customers and Should I Take Advantage of Them?

There is no doubt that the COVID-19 pandemic will be financially devastating to most Americans: savings accounts will be depleted or significantly reduced, credit scores will drop, and many will lose their jobs, homes, cars, etc. We have absolutely no idea what the next few weeks will bring, but I truly believe that you can take steps today to reduce the financial impacts of the COVID-19 pandemic. Whether or not you are currently employed, you need to review your finances and make a financial plan for your uncertain future. If you lost your job over the past few weeks, you need a plan. If you are currently employed and believe you are secured in your job, you too still need to have a plan because these are uncertain times. We do not know what challenges tomorrow may bring, but what we do know is that we all need to focus on the health and safety of our families and ourselves, not on expenses we are struggling to pay because of something outside of our control.

Almost two weeks ago, after Governor Andrew Cuomo issued a stay-at-home order for the entire state of New York, panic started to settle in. I started to ask myself the “what ifs’ that many small businesses owners are asking themselves more today than ever before. “What if” none of my clients are able to pay? “What if” I am unable to pay my business expenses? “What if” I am unable to pay my paralegal? On a personal level, the “what ifs” were also haunting me. “What if” if I am unable to pay my student loans? “What if” I can’t afford to purchase groceries? “What if” I can’t pay my light bill? The “what ifs” were certainly driving me insane but whenever I have an issue or a challenge in my life, I like to plan my way through it. So I picked up my pen and I listed all of my expenses. I then contacted each of my creditors to find out if they had a disaster relief policy. I was pleasantly surprise that most of my creditors offered 90 or 120 days of forbearance or deferment. This is the break I needed, and this is the break you need as well. If you didn’t know this before, you know this now and it is time for you to take action.

So, what should you do to minimize the financial impact of the COVID-19 pandemic to your personal and/or business finances? Take action now by doing the following:

1. Make a list of all your creditors. Your list should include mortgage lenders, banks, cable companies, utility companies, etc. I compiled a list of companies that offer a coronavirus relief programs below. This list is not exhaustive and will be updated frequently.

2. Contact each of your creditors to inquire about their relief programs. Unfortunately, there are a few companies that are completely oblivious to what is happening, and they do not have a relief program, or their relief programs are lacking. Before accepting or participating in any relief programs, you should ask your creditors these questions:

· How long is the emergency relief payment deferment?

· Most companies are providing deferment for 90 or 120 days, with the possibility of an extension.

· Are late fees waived during the term of the deferment?

· Will missed payments be reported to the credit bureaus?

· Will interest continue to incur during the deferment period?

· In some cases, creditors will waive late fees but the interest will continue to incur. If this is the case and if you are able to, consider paying the interest only or a portion of the interest.

· Is there a penalty if I make a payment while my loan is in deferment?

· Will the deferred payments be due at the end of the deferment term (balloon payment) or will the payments be added to end of the loan term?

· This is a very important question. Most companies are adding the missed payments to the end of the loan. However, financial institutions like Charles Schwab Bank require that the missed payments be due in full (balloon payment) at the end of their 90-day relief period. If you are unable to pay the full amount, you may have to refinance or modify the loan.

Knowing the answers to these questions will allow you to make informed decisions. Whether you are employed or unemployed, do this now so that you can focus on what is most important: your and your families’ health and safety.

Major Companies and Banks

Providing COVID-19

Payment Relief Programs*

Comcast. https://corporate.comcast.com/covid-19

Optimum. https://www.optimum.com/coronavirus

Con Edison. https://www.coned.com/en/about-us/media-center/news/coronavirus/updates

National Grid. https://www.nationalgridus.com/Upstate-NY-Home/covid-19 (Upstate NY)

https://www.nationalgridus.com/NY-Home/default (NYC)

Ally Bank. https://media.ally.com/2020-03-18-Ally-Introduces-Relief-Package-to-Support-Customers-Auto- Dealers-Communities-and-Employees-During-Global-COVID-19-Crisis

Bank of America https://about.bankofamerica.com/promo/assistance/latest-updates-from-bank-of-america-coronavirus

Capital One. https://www.capitalone.com/coronavirus/

Chase. https://www.chase.com/digital/resources/coronavirus/auto-lending (Auto)