Coronavirus has caused devastating job losses in countries around the world. Government financial support has helped many, but even with this assistance, the struggles will continue as there may be fewer jobs to return to when this is over.
Work may have dried up for some, but the bills still need to be paid. If you have no source of new income, you’ll need to dip into savings or go into debt.
Debt Relief in a Pandemic
Paying back loans is always challenging, and the job market during coronavirus only makes matters worse. One Canadian province lost one million jobs since the start of the pandemic.
Thankfully, regions are beginning to gradually re-open their businesses, and people are going to be able to get back to work. But the economic challenges posed by coronavirus will likely continue for a few reasons:
How to Approach Creditors
You’re more likely to get creditors to cooperate if you take the right approach. Keep the following tips in mind.
Get Your Story Straight
Take the time to write out the story of how your income got disrupted and why you need assistance. There’s nothing to be embarrassed about: certain industries shut down, and it was simply impossible to work.
Speak to Creditors Before They Become Collectors
Creditors will be more sympathetic to your issues. If there are enough missed payments, the debt could be transferred to a collector, who are typically less sympathetic. Creditors have higher recovery rates, so speak to them from the outset and look to maintain this relationship.
Navigating debt repayment can be stressful, but creditors are not your enemy. Take a deep breath and keep calm. It’s in creditors’ best interest to work with you. If you find yourself feeling worked up and not getting the results you want, hang up and call them back after taking a deep breath.
Debt Consolidation Programs
If you’re unsuccessful talking with creditors, a certified Credit Counsellor from a not-for-profit agency may be able to intervene on your behalf. Ultimately, your creditors would like to get as much as they can, and the Credit Counsellor is the intermediary between both parties that helps resolve the situation to everyone’s satisfaction.
You may also get other forms of assistance, like reduced or stopped interest, an end to collection calls, and having various payments bundled into one streamlined monthly payment.
These may be economically stressful times, but don’t forget there are people you can talk to for real support.