Credit score during Coronavirus Pandemic
A grim situation exists as a result of the Coronavirus Pandemic in the US. More than a million Americans have lost their income due to the coronavirus outbreak. Several of them are facing the difficult choice between paying for necessities and paying off bills. This is threatening how to protect credit score during the Coronavirus Pandemic.
Nearly 60 percent of Americans said their household income has been negatively affected by the Coronavirus pandemic. According to a survey done on 3,000 people and more from the credit rating agency TransUnion, their credit scores are hanging in balance. Of these people, 70 percent of them said they were concerned about their ability to pay their bills and loans.
Financial Unease
This financial unease stretches across all income brackets, on how to protect credit score during Coronavirus Pandemic. Households that earn between $20,000 and $35,000 were the most concerned about paying bills and loans. But even half of those who make $200,000 or more annually are feeling nervous. Around the prospect of not being able to pay these debts.
Fortunately, banks and credit unions are offering to defer payments and waive fees for credit-card holders during the coronavirus emergency. Regulators urge banks and credit unions to offer small-dollar loans. As many Americans now face the possibility of delinquency consumer advocates think it as a terrible one.
Becoming delinquent on their debts and other bills, their credit scores could be adversely affected. Here are the steps people can take on how to protect credit score during the coronavirus pandemic. This leads to ensuring that they maintain as good a credit score as possible throughout the coronavirus emergency.
By law, consumers are entitled to one free copy of their credit report every year from the major credit bureaus. Such as Experian, TransUnion, and Equifax (EFX). They are on the threshold of what could be a major economic downturn which could leave many people out of work for an extended period of time.
When reviewing your credit report, be on the lookout for any incorrect information on to protect credit score during the Coronavirus pandemic. It is done to ensure it doesn’t take too big of a toll on your credit history.
Make a minimum payment
Ideally, consumers should aim to pay the full amount they owe each month to protect credit scores during the Coronavirus pandemic. Especially with credit cards, while that may not be possible if you have lost your job and have reduced income. It is important to still make whatever payments you can, experts said.
Late payments can negatively impact a credit score, so it’s better to make a minimum payment instead of no payment at all. Additionally, keeping credit card balances low can help limit the impact on how to protect credit score during the coronavirus pandemic.
Additionally, for consumers who have signed up for Experian Boost or other services that report rent, phone or utility payments to the credit bureaus, making those payments could help to boost a person’s score.
If you usually mail a check or make one-time payments online, FICO recommends setting up recurring payments to protect credit score during Coronavirus. That will be deducted directly from your bank account. This will avoid accidentally missing a payment amid the stress caused by the illness outbreak. If you have automatic payments set up, you should also make sure you have overdraft protection.
